Omwenga Joseph Chanai & 26 others v Jack and Jill Supermarket Limited [2019] KEELRC 928 (KLR)
The bottom line
#When a landlord demolished their workplace, 21 supermarket workers were entitled to redundancy pay because destroyed premises don't automatically end employment in Kenya.
What this practically means
#Executive summary
#Key legal issues
#Whether loss of employment caused by a third party's demolition of the employer's premises constitutes redundancy
Yes. The demolition was a factor beyond the employer's control and the employees were at no fault; the loss of employment amounted to redundancy.
The court applied the statutory definition in section 2 of the Employment Act and Maraga JA's exposition in Kenya Airways v Aviation & Allied Workers Union. Redundancy entails involuntary loss of employment at no fault of the employee due to factors beyond the employer. Although the employer did not initiate the demolition, it anticipated it after protracted litigation and should have notified employees or relocated. The demolition immediately caused the loss of jobs, making it redundancy.
Whether the employer could rely on frustration of contract by a third party
No. The third party's acts did not make it impossible to terminate employment formally or relocate.
The respondent had received notice to vacate, litigated from 2009, and obtained orders staying demolition. A prudent employer would have wound up or relocated. Having done nothing, it could not plead frustration; the demolition did not render formal termination of the employment relationship impossible.
Which claimants were employees at the time of demolition and entitled to reliefs
21 claimants proved employment via the 15th May 2013 payroll; four did not, and two had been paid in full and final settlement.
Relying on the respondent's Payment Generation Report for the mid-month payment of 15th May 2013, all claimants except Rebecca Sompio, Antor Nduku Joseph, Mariam Abdalah and Nuria Ade appeared on the payroll. Those four failed to prove employment at demolition; two others had settled. Only 21 claimants were beneficiaries of the judgment.
Entitlement to severance pay, notice pay, May 2013 salary and leave
The 21 claimants were awarded payment for 8 days worked (Kshs.234,000 total admitted), one month's salary in lieu of notice, severance at 15 days' pay per completed year, and 2013 leave (7 days), but no compensation for unfair termination.
Having found redundancy, the court awarded severance pay at 15 days' pay per completed year of service, salary in lieu of notice, and admitted wages for 15th-23rd May 2013. Leave was awarded only for 2013 as individual periods were unproved. Compensation for unfair termination was refused because the loss of employment was redundancy occurring in exceptional circumstances.
Legal principles established
#- Redundancy under section 2 of the Employment Act requires loss of employment by involuntary means, at no fault of the employee, and due to factors beyond the employer, even where the trigger is a third party's destruction of the premises
- Employment does not end merely because the workplace premises are destroyed; the employer must relocate or formally terminate employment
- Frustration by a third party's act is no defence where the employer could still have formally terminated employment or relocated
Court orders
#- 1.Declaration that the loss of employment by the 21 successful claimants arose through redundancy
- 2.Award to each of the 21 claimants of payment for days worked between 15th and 23rd May 2013, salary in lieu of notice, severance pay at 15 days' pay for each completed year of service, and leave for 2013 (7 days at 1.75 days per month for 4 months), totalling Kshs.2,322,665.38 as set out in the court's table
- 3.Respondent to pay claimants' costs
- 4.Interest to accrue from date of judgment till payment in full
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act (first-instance statement of claim)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Omwenga Joseph Chanai & 26 others v Jack and Jill Supermarket Limited [2019] KEELRC 928 (KLR)", Case Analysis (2019). Cause No 925A of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/928/eng@2019-08-02
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.