Simon Munyi Maranga & another v Express Kenya Limited [2019] KEELRC 257 (KLR)
The bottom line
#Two long-serving managers won millions in gratuity and leave pay, but the court rejected their claim that they had been unfairly declared redundant.
What this practically means
#Executive summary
#Key legal issues
#Whether the termination was on account of redundancy or misconduct
The termination was not on account of redundancy; the termination letters did not refer to retrenchment and the minutes did not declare the Claimants redundant
The termination letters dated 9th September 2004 made no reference to retrenchment, and the minutes of 21st August 2004 only agreed to come up with a reorganisation plan in due course without declaring the Claimants redundant. Although the Claimants were aware of impending restructuring, the stated reason for termination was different. No redundancy letters were issued to them.
Whether the Claimants were unfairly terminated
No proof of unfair termination, as the repealed Employment Act Cap 226 governed and imposed no requirement of reason or hearing
The cause of action arose in 2004, before the Employment Act 2007 was enacted, so provisions of the 2007 Act and case law on actions after its enactment were not applicable. The repealed Employment Act Cap 226, which was in force, did not require a reason to be given prior to termination or a right to be heard.
Entitlement to gratuity
Claimants entitled to gratuity under Clause 20 of the terms and conditions of employment since they were not summarily dismissed but terminated on 3 months' notice
Clause 20 of the Respondent's Terms and Conditions of Employment provided for gratuity of 15 days' pay per completed year after five years' service, but excluded employees summarily dismissed for lawful cause. The Claimants were not summarily dismissed but terminated under Clause 17 with 3 months' notice, so the exclusion did not apply. Entitlement arises from the contract, not from what colleagues were paid.
Entitlement to outstanding leave pay
Claimants entitled to outstanding leave pay; employer cannot force leave to run concurrently with notice
The termination letters directed the Claimants to take their full outstanding leave immediately. The court held the employer had no justification to force them to take leave concurrently with the notice period, and neither the repealed Employment Act Cap 226 nor the terms of employment authorised forcing leave instead of payment. The Respondent's own HR policy (Clauses D4 and D5) provided for both notice pay and pay in lieu of outstanding leave.
Legal principles established
#- Where the Employment Act Cap 226 (repealed) applied, an employer was not required to give a reason prior to termination or accord a right to be heard
- Gratuity entitlement flows from the terms and conditions of employment, not from what colleagues received, provided the employee was not summarily dismissed
- An employer cannot force an employee to take leave running concurrently with the notice period; the employee is entitled to both pay in lieu of notice and pay in lieu of outstanding leave
Court orders
#- 1.Gratuity pay of Kshs.1,740,562.00 to the 1st Claimant (15 days' pay for every completed year of service: 204,722 x 17 years)
- 2.Outstanding leave pay of Kshs.307,158.00 to the 1st Claimant (36 days)
- 3.Gratuity pay of Kshs.1,622,432.00 to the 2nd Claimant (15 days' pay for every completed year of service: 101,402 x 32 years)
- 4.Outstanding leave pay of Kshs.291,530.75 to the 2nd Claimant (69 days)
- 5.Interest to accrue from date of judgment
- 6.Respondent to bear costs of the suit
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction over employment claims (Article 162(2)(a) of the Constitution, not expressly cited in the judgment)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Simon Munyi Maranga & another v Express Kenya Limited [2019] KEELRC 257 (KLR)", Case Analysis (2019). Cause No 277 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/257/eng@2019-11-29
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.