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ELRCPartially AllowedNot stated in the judgment· [2016] KEELRC 1847 (KLR)

Humphrey Owino Omondi v Vishnu Builders Limited [2016] KEELRC 1847 (KLR)

Employment and Labour Relations Court
28 July 2016
HWHellen Wasilwa
1,723 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A worker paid weekly for years is not a casual labourer under Kenyan law, and employers who skip redundancy steps must pay up to twelve months' salary.

What this practically means

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Executive summary

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The Claimant sued for damages for unlawful termination, contending that he was employed by the Respondent as a Painter on 4th March 2004 at a daily rate of Shs. 450/= and was dismissed on 7th November 2012 without reason and without a hearing, on the ground that work had reduced. He sought a declaration that the dismissal was unlawful and unfair, damages of Shs. 337,500/=, costs and interest. The Respondent denied the claim, asserting that the Claimant was a casual labourer engaged by the day as projects arose, with no employment records kept, and that having been declared redundant on account of reduced business it owed him no pay in lieu of notice beyond one day's pay. The court framed three issues: the Claimant's employment status, whether due process preceded the redundancy, and the remedies payable. Relying on Sections 2 and 37 of the Employment Act, 2007, the court held that the guarding principle of casual employment is daily payment; since the Claimant was paid weekly and worked continuously from 2004 to 2012, and the Respondent produced no employment records despite a Ministry of Labour request, he was a permanent employee. On the second issue, the court held that the reduction in work amounted to a redundancy and that the Section 40 procedure - notification, fair selection, leave pay, notice and severance - was never followed, rendering the redundancy unfair and unlawful. The court awarded one month's salary in lieu of notice (Shs. 13,500/=), twelve months' compensation (Shs. 162,000/=) and severance pay for eight years (Shs. 54,000/=), totalling Shs. 229,500/=, with costs to the Claimant.

Key legal issues

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01

Whether the Claimant was a casual or permanent employee.

Holding

The Claimant was a permanent employee, not a casual.

Reasoning

Section 2 of the Employment Act defines a casual employee as one paid at the end of each day and not engaged for more than twenty-four hours at a time. The Claimant was paid weekly and worked continuously from 2004 to 2012. Under Section 37(1), such a contract is deemed to be one where wages are paid monthly. The Respondent also failed to produce employment records required by the Ministry of Labour.

p. 3
02

Whether due process was followed before the redundancy.

Holding

The redundancy was unfair and unlawful as the Section 40 procedure was not followed.

Reasoning

Having established that reduced work amounted to a declaration of redundancy, the court set out the Section 40 requirements: notification of the employee and labour officer, due regard to seniority, skill and reliability, payment of leave, one month's notice or pay in lieu, and severance pay of not less than fifteen days' pay per completed year of service. None of these steps was taken.

p. 4
03

What remedies to grant.

Holding

One month's pay in lieu of notice, twelve months' compensation and severance pay for eight years, totalling Kshs. 229,500/=.

Reasoning

Having found the redundancy unlawful, the court awarded the statutory notice pay, the maximum twelve months' compensation for unfair termination, and severance pay computed at fifteen days' salary for each of the eight completed years of service, plus costs of the suit.

p. 4

Legal principles established

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  • The defining characteristic of a casual employee is daily payment, and engagement not exceeding twenty-four hours at a time.
  • A worker paid weekly who serves continuously for years is by operation of Section 37 of the Employment Act deemed a permanent employee whose contract is paid monthly.
  • An employer who cannot produce employment records required by the Ministry of Labour cannot insist that the worker was a casual.
  • Termination on account of reduced work is a redundancy and must follow the procedural requirements of Section 40 of the Employment Act.

Court orders

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  1. 1.Payment of 1 month salary in lieu of notice of Kshs. 13,500/=.
  2. 2.Payment of 12 months salary as compensation for unlawful redundancy of Kshs. 162,000/=.
  3. 3.Payment of severance pay for 8 years of Kshs. 54,000/=.
  4. 4.Respondent to pay costs of the suit.

Authorities

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Legislation

  • Employment Act, 2007Section 2 (definition of casual employee)
  • Employment Act, 2007Section 37 (conversion of casual contracts)
  • Employment Act, 2007Section 40 (redundancy procedure)
  • Employment Act, 2007Section 35(1) (notice of termination)
  • Employment Act, 2007Section 45 (fair procedure for termination)

Cases cited (5)

  • Silas Mutwiri vs Haggai Multi Cargo Handling Services Limited
    Cause No. 107 of 2010
  • Donald Odeke Vs. Fidelity Security Ltd
    Cause 1998 of 2011
  • Francis Runji Karingi & 5 Others Vs China Hebei Water Conservancy Engineering Bureau
    (2014) eKLR
  • Nelson Onyango Othoo Vs Wilham Kenya Limited
    (2012) eKLR
  • Consolata Wanjiku Ndirangu Vs Wilham Kenya Limited
    Cause No. 222(N) of 2008
Jurisdiction invoked
Employment and labour relations jurisdiction (Employment Act, 2007)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (7)

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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, "Humphrey Owino Omondi v Vishnu Builders Limited [2016] KEELRC 1847 (KLR)", Case Analysis (2016). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/1847/eng@2016-07-28

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