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ELRCPartially AllowedEmployment Cause (Memorandum of Claim filed 15th July 2015)· [2019] KEELRC 1749 (KLR)

David Ithau Wambua v Liberty Kenya Holdings Limited (Cause 1237 of 2015) (Employment and Labour) [2019] KEELRC 1749 (KLR)

Employment and Labour Relations Court
30 April 2019
6,210 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~25 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ruled Liberty Life's 18-day redundancy notice and lack of consultation were unfair, awarding an ex-employee 8 months' salary.

What this practically means

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Executive summary

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The Claimant, formerly Regional Head Marketing and Communication, sued his former employer alleging that his declaration of redundancy in May 2015 was unconstitutional, unlawful and procedurally and substantively unfair, and that during his employment he suffered discrimination on grounds of race and nationality, being paid less than his white South African predecessor and than a junior employee, plus unfair labour practices including failure to appraise him and underpayment of bonuses and salary increments. He sought declarations, constitutional damages, reinstatement or alternatively 12 months' gross pay computed at his predecessor's Job Grade 1 rate, and refunds of travel allowances and car insurance premiums. The Respondent maintained the redundancy followed section 40 of the Employment Act, that salaries were individually negotiated, and that bonuses and appraisals were discretionary. After trial, the court framed three issues: fairness of the redundancy, discrimination, and remedies. On the first, the court found the Claimant received only about 18 days' notice instead of the one month required by section 40, and that there was no consultation, applying the Court of Appeal's guidance in Kenya Airways v Aviation & Allied Workers Union; it further found the position named in the redundancy letter was not the Claimant's actual realigned position. The redundancy was therefore procedurally unfair. On discrimination, the court held that the Claimant had negotiated his own contract and could not claim discrimination over his predecessor's higher salary, and no evidence proved his junior earned more; unfair labour practice claims failed as the bonus complaint had been rectified. On remedies, the court awarded 8 months' salary (KShs. 3,810,240) as compensation for the unfair redundancy, ordered release of the Claimant's motor vehicle log book, and awarded the Claimant costs. All other reliefs, including the discrimination declarations and refunds, were refused.

Key legal issues

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01

Whether the redundancy was procedurally fair under section 40 of the Employment Act

Holding

The redundancy was procedurally unfair: the Claimant received only about 18 days' notice instead of the statutory one month and there was no consultation.

Reasoning

The redundancy letter of 13th May 2015 took effect on 31st May 2015, giving roughly 18 days rather than the one month required by section 40(1) of the Employment Act. Relying on the Court of Appeal's decision in Kenya Airways v Aviation & Allied Workers Union, the court held that notice under section 40 is not merely informational but enables consultation to avert or minimise terminations. There was no indication of any consultation before the redundancy, rendering it unfair and unjustified.

p. 7
02

Whether the abolition of the Claimant's position was a genuine redundancy

Holding

The court found the position named in the redundancy letter had effectively been superseded by a realignment, and the Claimant's actual position was not validly abolished.

Reasoning

A 7th March 2014 email showed a revised structure approved by the Board under which the Claimant occupied the position of General Manager (Marketing & Communications), which was not shown vacant nor abolished, while other staff retained General Manager positions. The redundancy letter referred to the older 'Regional Head Marketing and Communication' role, and there was no evidence of any subsequent change to the Claimant's position, supporting the Claimant's contention that the position stated to be redundant was not the position he actually held.

p. 6
03

Whether the Claimant was discriminated against on pay compared to his predecessor and junior

Holding

No discrimination established: the Claimant negotiated his own salary, his predecessor's scope was wider, and no proof showed his junior earned more.

Reasoning

Although the Claimant's predecessor earned KShs. 650,000/= against his KShs. 400,000/=, her responsibilities were wider, his role having been orally amended to cover Kenya operations only. The court applied Miguna Miguna v Attorney General, holding that an employee who accepts negotiated terms cannot plead discrimination on learning a colleague earns more. Regarding Mr. Githae, the Respondent denied he was junior, and any pay difference could reflect promotions, experience and length of service.

p. 7
04

Whether failure to appraise and underpayment of bonuses amounted to unfair labour practices

Holding

Not established; the bonus complaint was rectified and no detriment from the appraisal omission was shown.

Reasoning

The court accepted that Article 41 guarantees fair labour practices, but found that the bonus underpayment complaint had been corrected with a back-payment, and the failure to conduct appraisals was not shown to have operated against the Claimant. No evidence linked the omission to any disadvantage in salary review or bonus awards, so the claim of unfair labour practices failed.

p. 7

Legal principles established

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  • Section 40(1) of the Employment Act requires at least one month's notice for redundancy and notice is intended to enable real consultation to avert, minimise or mitigate terminations.
  • Consultation in a redundancy must be real and meaningful, not cosmetic or a charade.
  • An employee who negotiated his own contract terms cannot plead discrimination merely because another employee negotiated a higher salary.

Court orders

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  1. 1.Award of 8 months' salary as compensation for the unfair redundancy, being 8 x 476,280 = KShs. 3,810,240/=.
  2. 2.Order that the Claimant's log book in respect of his motor vehicle be released to him.
  3. 3.Order that the Respondent pay the costs of the suit.

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 41(1) (fair labour practices)
  • Constitution of Kenya, 2010Article 27 (equality and freedom from discrimination)
  • Constitution of Kenya, 2010Article 35(1)(b) (access to information)
  • Constitution of Kenya, 2010Article 23(3) and Article 23 (remedies)
  • Employment ActSection 40 (redundancy procedure)
  • Employment ActSection 45(2) (valid and fair reasons for termination)
  • Employment ActSection 5(6) (burden of proof in discrimination)
  • Employment ActSection 90 (limitation for continuing injury claims)
  • Labour Relations Act, 2007Part VIII, Section 62(4) (reference of trade disputes to Minister for Labour)

Cases cited (5)

  • Ol Pejeta Ranching Limited vs. David Wanjau Muhoro
    [2017] eKLR
  • Peter Wambugu Kariuki & 16 Others vs. Kenya Agricultural Research Institute
    [2013] eKLR
  • Stephen K. Kachila vs. Bamburi Cement Limited
    [2015] eKLR
  • Kenya Airways Limited vs Aviation & Allied Workers Union
    CA No. 46 of 2013
  • Miguna Miguna vs the Attorney General
    Cause 413/2011 (eKLR) 2012
Jurisdiction invoked
Constitutional and employment claims under Articles 23, 27, 35 and 41 of the Constitution and the Employment Act; reliefs sought under Article 23(3) of the Constitution

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, "David Ithau Wambua v Liberty Kenya Holdings Limited (Cause 1237 of 2015)  (Employment and Labour) [2019] KEELRC 1749 (KLR)", Case Analysis (2019). Employment Cause (Memorandum of Claim filed 15th July 2015). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/1749/eng@2019-04-30

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