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ELRCPartially AllowedCause (employment claim commenced 9th May 2014)· [2016] KEELRC 895 (KLR)

Andrew Waire Ndunu v Express Automation Limited [2016] KEELRC 895 (KLR)

Employment and Labour Relations Court
6 July 2016
2,073 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
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The bottom line

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A Kenyan court ruled an employer's redundancy unlawful because it skipped required notifications, awarding the employee notice pay, leave dues, and six months' compensation.

What this practically means

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Executive summary

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The Claimant, employed as a service coordinator, sued his erstwhile employer claiming wrongful termination on 31st March 2014 and non-payment of terminal dues. He alleged the termination was disguised as a downsizing exercise but no redundancy procedure was followed: he was not notified of impending redundancy, the labour officer was not notified, new staff were hired, and he sought notice pay, leave dues, 12 months' compensation, and payment for the unexpired 17 months of a two-year contract, with costs and interest at commercial rates. The Respondent attributed the termination to downsizing due to economic hardship, said a cheque for one month's notice and leave had been prepared but declined, raised a missing money counting machine, and urged dismissal with costs. The Claimant testified he was neither notified of redundancy nor was the labour officer informed; the Respondent's assistant human resource manager conceded no attachment showed the Claimant had the machine and that the list of employees made redundant was not given. The court held that in unlawful termination claims the employee proves unlawfulness while the employer must justify the dismissal by proving valid reasons under Section 43. The Respondent's case was unclear between redundancy and dismissal for cause. Applying Section 40, the court found the redundancy non-compliant since the dismissal letter was not copied to the labour officer and statutory payments had not been made. The termination was therefore contra statute and the Claimant succeeded. Remedies under Section 49: one month's salary in lieu of notice (Kshs. 28,528/-), leave dues (Kshs. 28,528/-), and six months' compensation (Kshs. 171,168/-), the court deeming 12 months excessive given the two-year contract. No payment was awarded for the unexpired contract. Costs of the suit to the Claimant with interest at court rates from judgment until payment in full. Judgement delivered at Nairobi on 6th July 2016 by Nzioki wa Makau J.

Key legal issues

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01

Whether the redundancy declaration complied with Section 40 of the Employment Act

Holding

The redundancy was not in conformity with the law because the Claimant was not properly notified and the labour officer was not notified; the termination was therefore unlawful

Reasoning

Section 40 requires notification of the employee personally in writing and of the labour officer not less than a month before the termination on account of redundancy, plus payment of notice, leave and severance. The only letter was the dismissal letter of 31st March 2014, not copied to the labour officer. The Claimant had not received the payments envisaged under Section 40, so the redundancy failed statutory conformity.

p. 4
02

Whether the Respondent proved the reasons for termination

Holding

The Respondent failed to prove the reasons; it was unclear whether it relied on redundancy or dismissal for cause, and it asserted it need not avail proof of employees declared redundant

Reasoning

The Respondent's pleadings and submissions vacillated between redundancy and dismissal for cause. Either way, Section 43 imposed a duty to prove valid reasons. The Respondent's stance that it need not produce the list of employees declared redundant was untenable, and no attachment showed the Claimant was responsible for the missing machine.

p. 3
03

Quantum of remedies under Section 49

Holding

One month's salary in lieu of notice, leave dues, and six months' compensation awarded; no payment for the unexpired contract term

Reasoning

Remedies are guided by Section 49 and the conduct of the employer, which failed to notify the relevant officials, issue a certificate of service or pay service pay. Twelve months' compensation was excessive given the two-year contract, so six months was awarded. Notice pay and leave dues were granted as claimed.

p. 4

Legal principles established

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  • An employer cannot rely on redundancy as the reason for termination without complying with the notification requirements of Section 40 of the Employment Act, including notification of the labour officer
  • In an unlawful termination suit the employee bears the burden of proving the termination was unlawful, while the employer must justify the dismissal by proving valid reasons under Section 43

Court orders

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  1. 1.One month salary in lieu of notice Kshs. 28,528/-
  2. 2.Leave due Kshs. 28,528/-
  3. 3.6 months compensation Kshs. 171,168/-
  4. 4.Costs of the suit
  5. 5.Interest on items (i), (ii), (iii) and (iv) at Court rates from the date of judgment till payment in full

Authorities

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Legislation

  • Employment ActSection 40(1)(a)-(h)
  • Employment ActSection 41
  • Employment ActSection 43
  • Employment ActSection 44
  • Employment ActSection 45(1)
  • Employment ActSection 47
  • Employment ActSection 49

Cases cited (8)

  • Beatrice Achieng Osir v Board of Trustees Teleposata Pension Scheme
    Cause No. 665 of 2011 (unreported)
  • Edward Kabogo Munene v Equity Bank Limited
    Cause No. 1123 of 2012 (unreported)
  • Peter Maroko Omondi v Pandya Memorial Hospital
    [2014] eKLR
  • Jane Wairimu Machira v Mugo Waweru & Associates
    Cause 621 of 2012 (unreported)
  • Mary Mutanu Mwendwa v Ayuda Ninos De Africa (Anidan K)
    [2013] eKLR
  • Sarah Wanyaga Muchiri v Henry Kathii & Another
    [2014] eKLR
  • Kenya Plantation and Agricultural Workers Union v James Finlay (K) Ltd
    [2013] eKLR
  • CMC Aviation Limited v Mohamed Noor
    [2015] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act (Sections 40, 41, 43, 45, 47, 49) over a claim of wrongful termination and non-payment of terminal dues

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Andrew Waire Ndunu v Express Automation Limited [2016] KEELRC 895 (KLR)", Case Analysis (2016). Cause (employment claim commenced 9th May 2014). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/895/eng@2016-07-06

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