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ELRCPartially AllowedCause (not stated in judgment; Cause commenced 2 October 2014)· [2016] KEELRC 1783 (KLR)

Charles Ondiek Okemwa v Eldoret Mattress Limited & Daniel Ngugi T/A Kamtinga Services Ltd (Cause 474 of 2014) [2016] KEELRC 1783 (KLR)

Employment and Labour Relations Court
29 January 2016
720 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court ruled that an employer must prove it followed redundancy notice rules, and awarded the worker over Kshs 400,000.

What this practically means

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Executive summary

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The Claimant sued the Respondents on 2 October 2014 alleging unfair termination of employment and underpayment. He testified that his employment was terminated on 2 July 2014 without notice to himself or his Union; the Respondents asserted the termination was on account of redundancy but called no witnesses. The Court framed two issues: whether the termination was unfair, and the appropriate remedies. Holding that the employer bears the burden of proving compliance with section 40 of the Employment Act, 2007 in a redundancy, the Court found the Respondents had neither notified the Claimant or his Union in writing at least one month in advance nor notified the Local Labour Officer, rendering the termination procedurally unfair. In the alternative, it found the termination substantively unfair because the Respondents did not prove the redundancy was driven by operational requirements. On remedies, the Court declined the claim for one month's pay in lieu of notice because the Claimant confirmed he had been paid it, and declined severance pay because the parties did not clarify what the Kshs 18,300/- service pay was anchored on, instead factoring it into compensation. The uncontroverted overtime claim was awarded in full as pleaded. Exercising discretion under section 49(1)(c) and having regard to about 3 years of service and a gross wage of Kshs 12,200/-, the Court awarded 4 months' gross wages as compensation. The Court awarded a total of Kshs 403,525/- and granted the Claimant costs. Judgment was delivered in Nakuru on 29 January 2016 by Radido Stephen, Judge.

Key legal issues

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01

Procedural fairness of the redundancy

Holding

The termination was procedurally unfair because the Respondents did not prove that the Claimant and/or his Union were notified in writing at least one month in advance, nor that the Local Labour Officer was notified.

Reasoning

Redundancy terminations are governed by section 40 of the Employment Act, 2007. Since the employer knows the reason for termination, it bore the burden of demonstrating compliance with the statutory conditions. The Respondents failed to show written notice of at least one month to the employee or Union and failed to show notification of the Local Labour Officer. That singular failure rendered the redundancy procedurally unfair.

p. 1
02

Substantive fairness of the redundancy

Holding

In the alternative, the termination was substantively unfair because the Respondent did not prove the redundancy was on account of its operational requirements.

Reasoning

Even if the procedural analysis were wrong, section 45(2)(b)(ii) requires the employer to show a valid and fair reason for termination. The Respondent, having asserted redundancy, had to prove that the redundancy arose from its operational requirements. It called no witnesses and led no evidence on this, so the Court alternatively found the termination substantively unfair.

p. 2
03

Overtime claim

Holding

The overtime claim as set out in the Memorandum of Claim was awarded because the Respondents did not challenge or controvert the Claimant's testimony or the computation.

Reasoning

The Claimant testified that he worked from 8.00am to 8.00pm; the Respondents opted not to call witnesses and did not challenge this evidence or interrogate the computation of overtime. Uncontroverted evidence stands, so the Court found for the Claimant on the overtime figures pleaded.

p. 2
04

Compensation for unfair termination

Holding

The Court awarded the equivalent of 4 months' gross wages as compensation under section 49(1)(c), considering the Claimant's approximately 3 years of service.

Reasoning

Compensation is a primary remedy under section 49(1)(c) but remains discretionary, guided by the factors in section 49(4). The Court considered the length of service of about 3 years and the Claimant's gross wage of Kshs 12,200/-, and elected to award 4 months' gross wages, also taking into account the declined severance pay.

p. 2

Legal principles established

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  • Termination on account of redundancy must comply with sections 40 and 45(2)(b)(ii) of the Employment Act, 2007, including written notice of at least one month to the employee and/or union and notification of the Local Labour Officer.
  • The burden of proving compliance with section 40 in a redundancy rests on the employer, who ordinarily knows the reason for termination.

Court orders

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  1. 1.Declaration that the termination of the Claimant's employment through redundancy was unfair
  2. 2.Respondents to pay the Claimant overtime of Kshs 354,725/-
  3. 3.Respondents to pay the Claimant 4 months' wages as compensation of Kshs 48,800/-
  4. 4.Total award of Kshs 403,525/- to the Claimant
  5. 5.Claimant to have costs of the Cause

Authorities

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Legislation

  • Employment Act, 2007section 40
  • Employment Act, 2007section 45(2)(b)(ii)
  • Employment Act, 2007section 40(1)(f)
  • Employment Act, 2007section 35
  • Employment Act, 2007section 40(1)(g)
  • Employment Act, 2007section 49(1)(c)
  • Employment Act, 2007section 49(4)
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (fair termination and remedies under sections 40, 45 and 49)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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

Cite this brief

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Cite this brief

Caselaw, "Charles Ondiek Okemwa v Eldoret Mattress Limited & Daniel Ngugi T/A Kamtinga Services Ltd (Cause 474 of 2014) [2016] KEELRC 1783 (KLR)", Case Analysis (2016). Cause (not stated in judgment; Cause commenced 2 October 2014). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/1783/eng@2016-01-29

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