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ELRCPartially AllowedNot stated in the judgment text· [2019] KEELRC 473 (KLR)

Muthoni Nyagaki Mugo v Kemetrica Limited [2019] KEELRC 473 (KLR)

Employment and Labour Relations Court
25 October 2019
2,897 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~12 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled an employee's redundancy unfair because the employer skipped the mandatory notice required by Section 40 of the Employment Act.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent from July 2013 as a Monitoring and Evaluation Specialist and later as Communication Specialist, was terminated on 30th September 2015 on account of redundancy after a period of probation and a Performance Improvement Plan. She filed a claim seeking declarations that the termination was unlawful, unfair and discriminatory, together with compensation, damages, interest and costs. The Respondent admitted the employment but contended that it complied with Section 40 of the Employment Act, 2007 and paid all terminal dues. The parties proceeded by written submissions, the facts not being contested. The court framed two issues: whether the redundancy was lawful and fair, and whether the Claimant was entitled to the reliefs sought. The court found no evidence that the Claimant was served with a notice of intention to declare her position redundant under Section 40(a) prior to termination, and noted that the letter to the Labour Officer was received six days after the termination, whereas such notice is meant to elicit advice on the redundancy process. It held the redundancy unprocedural and therefore unfair. However, the discrimination claim failed for want of proof, the Claimant's sole evidence being that she was the only employee affected. The court awarded compensation equivalent to three months' salary (Kshs.348,432.15 computed, stated as Kshs.348,532.15 in the award, subject to statutory deductions), plus costs and interest from the date of judgment. Judgment delivered at Nairobi on 25th October 2019 by Maureen Onyango, Judge.

Key legal issues

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01

Whether the Respondent complied with the redundancy procedure under Section 40 of the Employment Act, 2007

Holding

The Respondent failed to comply; no notice of intention to declare the position redundant was issued to the Claimant under Section 40(a), and the notice to the Labour Officer was received six days after termination.

Reasoning

The court examined the termination letter dated 30th September 2015 and the letter to the Labour Officer, which was received at the County Labour Office on 6th October 2015, six days after the termination. There was no evidence of a prior redundancy notice to the Claimant. Relying on authorities on the sequence of notices under Section 40, the court found the procedure non-compliant, rendering the redundancy unprocedural and unfair.

p. 4
02

Whether the termination was discriminatory

Holding

The claim of discrimination failed for want of proof.

Reasoning

The Claimant's only evidence was that she was the only staff member affected by the redundancy, which was confirmed by the notice to the Labour Officer. The court held that this alone did not establish discrimination, and the Respondent had also argued that no evidence was adduced to support the assertion.

p. 5
03

What remedies flow from the finding of unfair termination

Holding

The Claimant was entitled to compensation equivalent to three months' salary.

Reasoning

Having found the redundancy unprocedural and therefore an unfair termination, the court awarded compensation taking into account all circumstances. Based on the September 2015 salary of Kshs.116,144.05, three months totalled Kshs.348,432.15, subject to statutory deductions, following the approach in Francis Maina Kamau v Lee Construction where a similar failure under Section 40 attracted a three-month award.

p. 5

Legal principles established

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  • An employer declaring redundancy must issue the employee with a notice of intention to declare the position redundant under Section 40(a) of the Employment Act before termination; failure renders the redundancy unprocedural and unfair.
  • The notice to the Labour Officer is meant to elicit advice to the employer on the modalities to be employed in the redundancy process and acts as a control measure against unlawful termination clothed as redundancy.

Court orders

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  1. 1.Three (3) months' compensation of Kshs.348,532.15/= subject to statutory deductions
  2. 2.Costs of the suit
  3. 3.Interest from date of judgment till payment in full

Authorities

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Legislation

  • Employment Act, 2007Section 2 (definition of redundancy)
  • Employment Act, 2007Section 40
  • Employment Act, 2007Section 40(1)(b)
  • Employment Act, 2007Section 40(1)(g)
  • Employment Act, 2007Section 40(a)
  • Employment Act, 2007Section 45

Cases cited (12)

  • Kenya Airways Limited Vs Allied Workers Union Kenya & 3 Others
    (2014) eKLR
  • Barclays Bank of Kenya Ltd & Another Vs Gladys Muthoni & 20 Others
    (2018) eKLR
  • Banking Insurance & Finance Union (Kenya) Vs Murata Sacco Society Limited
    (2014) eKLR
  • Osore Sammy Mohan Vs Tononoka Rolling Mills Limited
    (2018) eKLR
  • Gladys Muthoni Mwangi & 20 Others Vs Barclays Bank of Kenya Limited & Another
    (2016) eKLR
  • Hesbon Ngaruiya Waigi Vs Equitorial Commercial Bank Limited
    (2013) eKLR
  • Mary Nyawira Karimi Vs Pure Circle (K) Limited
    (2018) eKLR
  • Kenya Chemical & Allied Workers Union Vs Bamburi Cement Limited
    (2013) eKLR
  • Heritage Insurance Company Limited Vs Christopher Onyango & 3 Others
  • Bernard Misawo Obora vs Coca Cola Juices Kenya Limited
    [2015] eKLR
  • Margaret Mumbi Mwago Vs Intrahealth International
    (2017) eKLR
  • Francis Maina Kamau Vs Lee Construction
    (2014) eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over employment claims (Employment Act, 2007)

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, "Muthoni Nyagaki Mugo v Kemetrica Limited [2019] KEELRC 473 (KLR)", Case Analysis (2019). Not stated in the judgment text. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/473/eng@2019-10-25

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