Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
AI-generated case brief
Case Brief · caselaw.co.ke
ELRCPartially AllowedMemorandum of Claim dated 8th July 2014, filed 11th July 2014· [2016] KEELRC 725 (KLR)

Caroline Atieno Osweta v Bake & Bite Mombasa Limited [2016] KEELRC 725 (KLR)

Employment and Labour Relations Court
9 September 2016
2,358 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~9 min to read original · ~4 min brief

The bottom line

#

A Kenyan court ruled a 'redundancy' was fake and a signed discharge form could not stop the employee from claiming compensation.

What this practically means

#

Executive summary

#
The Claimant, employed as Human Resource Manager from 5th November 2012 and confirmed on 1st June 2013, was sent on 28 days' compulsory leave in September 2013 and on resuming on 24th October 2013 was handed a termination letter citing structural adjustment absorbing her position into the Operations Manager's portfolio. She sued for unlawful and unfair termination, seeking a declaration, 12 months' salary in compensation, and balance of notice and gratuity pay. The Respondent admitted the termination was due to structural adjustments approved by its Board and relied on a discharge form signed by the Claimant on 9th November 2013. The Court framed two issues: the lawfulness and fairness of the termination, and entitlement to remedies. It characterised the termination as a redundancy and tested both compliance with Section 40 of the Employment Act, 2007 and the genuineness of the redundancy. It found the redundancy was not genuine: Oburu, previously Security Officer, signed documents as (Ag.) Human Resource Manager after the Claimant left, and the restructuring collapsed after the Operations Manager from India departed within three months. The Respondent's contradictory evidence on the compulsory leave was disbelieved. Procedurally, no prior redundancy notice was issued to the Claimant or the Labour Officer. The discharge form could not bar the claim. The Court found the termination substantively and procedurally unfair, awarded four months' salary (Kshs. 520,000) plus Kshs. 60,000 notice pay and gratuity shortfall, with interest and costs to the Claimant.

Key legal issues

#
01

Whether there was a valid reason for termination - genuineness of the redundancy

Holding

The redundancy was not genuine; the Respondent had no valid reason for terminating the Claimant's employment, and the claimed restructuring collapsed after the Operations Manager left.

Reasoning

The certificate of service and NSSF letter were signed by Isaac Oburu as (Ag.) Human Resource Manager, undermining the claim that her position was absorbed. Oburu told the Court the Operations Manager from India left after three months and his position was abolished, so the new structure collapsed. The Court also disbelieved the Respondent's explanation of the compulsory leave, concluding there was an undisclosed reason for termination.

p. 5
02

Whether the Respondent complied with Section 40 of the Employment Act on redundancy procedure

Holding

The Respondent failed to issue prior notice of the redundancy to the Claimant and did not notify the Labour Officer, rendering the termination procedurally unfair.

Reasoning

Relying on Thomas De La Rue v David Opondo Omutelema, the Court held there must be two separate notices in a redundancy. Although the Claimant was paid one month's salary in lieu of notice, there was no evidence of prior notice of the redundancy nor notification to the Labour Officer as required by law.

p. 5
03

Effect of the discharge form signed by the Claimant on 9th November 2013

Holding

The discharge form does not bar the Claimant's claim; an employer cannot circumvent statutory obligations by waving a signed discharge.

Reasoning

The Claimant explained she signed the form to access her final dues, and the Court found no reason to disbelieve her. The Court cited settled jurisprudence that a form of discharge cannot be used by an employer to escape obligations under the law.

p. 5
04

Quantum of compensation and terminal dues

Holding

The Claimant was awarded four months' salary in compensation plus Kshs. 60,000 for shortfall in notice pay and gratuity.

Reasoning

In fixing compensation at four months' salary, the Court considered the Claimant's length of service (under a year) and the Respondent's conduct in the termination transaction. It also awarded Kshs. 60,000 being the shortfall in notice pay and gratuity, entering judgment for a total of Kshs. 580,000 with interest and costs.

p. 5

Legal principles established

#
  • An employer cannot rely on a signed form of discharge to circumvent statutory obligations owed to an employee.
  • A redundancy requires two distinct notices - a general notice and a specific notice to affected employees - and one cannot replace the other.
  • In redundancy terminations the court examines both compliance with Section 40 and whether the redundancy was genuine.

Court orders

#
  1. 1.4 months' salary in compensation of Kshs. 520,000
  2. 2.Notice pay and gratuity shortfall of Kshs. 60,000
  3. 3.Total judgment of Kshs. 580,000 with interest at court rates from the date of judgment until payment in full
  4. 4.Claimant awarded costs of the case

Authorities

#

Legislation

  • Employment Act, 2007Section 2 (definition of redundancy)
  • Employment Act, 2007Section 40
  • Labour Relations Act, 2007corresponding section defining redundancy

Cases cited (2)

  • Thomas De La Rue v David Opondo Omutelema
    [2013] eKLR
  • Lillian Nyambura v Highlands Water Company Limited
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (unfair termination claim)

Key timeline

#

Practical implications

#

Frequently asked questions

#

Later judgments citing this (1)

#

Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

#

Cite this brief

Caselaw, "Caroline Atieno Osweta v Bake & Bite Mombasa Limited [2016] KEELRC 725 (KLR)", Case Analysis (2016). Memorandum of Claim dated 8th July 2014, filed 11th July 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/725/eng@2016-09-09

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.