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ELRCPartially AllowedMemorandum of Claim dated 10th April 2017 (filed 12th April 2017)· [2019] KEELRC 2437 (KLR)

Chrispus Lwambi Saha v T.S.S Transporters Ltd [2019] KEELRC 2437 (KLR)

Employment and Labour Relations Court
17 January 2019
LNLinnet Ndolo
1,144 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court ruled that a redundancy was unfair because the employer ignored mandatory legal steps, awarding the worker over Kshs. 523,000.

What this practically means

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Executive summary

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The Claimant, a welder employed by the Respondent at a monthly salary of Kshs. 23,400 from 14th June 2008, sued after his employment was terminated on 10th October 2016 on account of redundancy. The Respondent, though duly served, filed no response and the matter proceeded by way of formal proof. The court framed two issues: whether the termination was unlawful and whether the remedies sought were payable. Relying on Section 40 of the Employment Act and the Court of Appeal decisions in Thomas De La Rue v Omutelelema and Kenya Airways v Aviation & Allied Workers Union, the court held that the redundancy conditions are mandatory. Apart from issuing the termination letter, the Respondent complied with none of them, and the termination was therefore substantively and procedurally unfair. The court awarded ten months' salary in compensation, taking into account length of service and the Respondent's conduct. It also awarded notice pay, salary for September 2016 and ten days of October 2016 (admitted claims under the Respondent's letter of 10th November 2016), gratuity for eight years, and leave pay for eight years plus prorata leave for 2016, as the Respondent produced no leave records. Total award: Kshs. 523,575 with interest at court rates from the date of judgment. The house allowance claim failed for want of proof of the terms of employment, and the NSSF and NHIF dues claims were refused because such dues are payable to the statutory bodies, not the Claimant. The Claimant was also granted a certificate of service and costs.

Key legal issues

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01

Whether the termination of the Claimant's employment on account of redundancy was lawful

Holding

The termination was substantively and procedurally unfair because apart from issuing the termination letter, the Respondent complied with none of the Section 40 redundancy conditions

Reasoning

The law recognises redundancy as a legitimate mode of termination, but Section 40 of the Employment Act imposes stringent mandatory conditions, including notification of the employee and labour officer, consideration of seniority, skill and reliability in selection, payment of leave in cash, one month's notice or wages in lieu, and severance pay of not less than fifteen days' pay per completed year of service. The Court of Appeal in Thomas De La Rue and Kenya Airways affirmed these conditions are mandatory. The Respondent, apart from issuing a termination letter, complied with none of them, rendering the termination unfair.

p. 3
02

Whether the Claimant was entitled to the remedies sought

Holding

Compensation of ten months' salary, notice pay, salary for September 2016 and 10 days of October 2016, gratuity for 8 years and leave pay were awarded; house allowance and direct payment of NSSF/NHIF dues were refused

Reasoning

Having found the termination unfair, the court awarded ten months' salary as compensation, factoring in the Claimant's length of service and the Respondent's conduct. Notice pay, September 2016 salary and 10 days' October salary were admitted claims under the Respondent's own letter of 10th November 2016 and were payable. Leave pay succeeded as the Respondent produced no leave records. House allowance failed for want of proof of terms of employment, and NSSF/NHIF dues are payable to the statutory bodies, not the Claimant.

p. 3

Legal principles established

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  • The conditions in Section 40 of the Employment Act for termination on account of redundancy are mandatory, not optional

Court orders

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  1. 1.Judgment entered in favour of the Claimant for Kshs. 523,575 comprising 10 months' salary in compensation (Kshs. 234,000), 1 month's salary in lieu of notice (Kshs. 23,400), salary for September 2016 (Kshs. 23,400), salary for 10 days in October 2016 (Kshs. 7,800), gratuity for 8 years (Kshs. 99,840), leave pay for 8 years (Kshs. 131,040) and prorata leave for 2016 (Kshs. 4,095)
  2. 2.Interest at court rates on the awarded amount from the date of judgment until payment in full
  3. 3.The Claimant is entitled to a certificate of service
  4. 4.Costs of the case awarded to the Claimant

Authorities

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Legislation

  • Employment ActSection 2
  • Employment ActSection 40(1)
  • Labour Relations Act, 2007definition of redundancy

Cases cited (2)

  • Thomas De La Rue v David Opondo Omutelelema
    [2013] eKLR
  • Kenya Airways Limited v Aviation & Allied Workers Union of Kenya & 3 others
    [2014] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (unfair termination and redundancy claim)

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, "Chrispus Lwambi Saha v T.S.S Transporters Ltd [2019] KEELRC 2437 (KLR)", Case Analysis (2019). Memorandum of Claim dated 10th April 2017 (filed 12th April 2017). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/2437/eng@2019-01-17

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