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ELRCDismissedCause No. 122 of 2015· [2020] KEELRC 1045 (KLR)

Simon Kiprop Mulwo v Valley Confectionary Limited [2020] KEELRC 1045 (KLR)

Employment and Labour Relations Court of Kenya at Nakuru
21 May 2020
MMM. Mbaru
1,296 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 upheld a security guard's redundancy because his employer gave proper notice and followed the Employment Act's required procedure.

What this practically means

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Executive summary

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The claimant sued the respondent alleging he was employed in May 2007 and that in March/April 2011 the respondent changed its name from Valley Bakery Limited, retaining him as a security guard. He alleged his employment was terminated on 30th April, 2012 on account of redundancy without prior notice, unfairly and without payment of terminal dues, and sought a declaration of unfair dismissal, reinstatement or, in the alternative, damages, three months' notice pay and leave earned for 14 years. The respondent denied any change of name from Valley Bakery Limited, asserting it was incorporated and commenced operations in 2011 as a distinct legal entity with different directors, shareholders and location, and that it employed the claimant on 30th April, 2011 as a casual earning Ksh.340 per day, issued 30 days' notice of redundancy, paid his statutory dues, leave and Ksh.30,000 in terminal dues. The court, applying section 40 of the Employment Act, 2007 and cited authorities, held that redundancy where notice is issued and the mandatory statutory procedure is followed is lawful. It found the notice dated 31st March, 2012 effective 30th April, 2012 issued, the claimant was allowed leave and paid Ksh.30,000, so no notice pay was due. It further held Valley Bakery Limited and the respondent were distinct entities, so service years with Valley Bakery could not be claimed against the respondent; any such dues should have been pursued by enjoining that entity. The suit was dismissed with costs to the respondent.

Key legal issues

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01

Whether the termination on account of redundancy was unfair

Holding

Not unfair - notice was issued and the claimant was allowed leave and paid dues

Reasoning

The court held that redundancy terminates employment at no fault of the employee but is lawful if section 40 of the Employment Act, 2007 is followed. The claimant was issued notice on 31st March, 2012 taking effect on 30th April, 2012, allowed to proceed on leave, and paid Ksh.30,000. With notice issued and compliance with section 40, the termination had justification and no unfair termination arose.

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02

Whether the claimant worked for the respondent for 14 years (continuity from Valley Bakery Limited)

Holding

No - Valley Bakery Limited and the respondent are distinct legal entities

Reasoning

The claimant's employment with the respondent commenced by written letter dated 30th April, 2011, while his employment with Valley Bakery Limited ended by notice of the same date, as shown by his own Certificate of Service. The defence that the two entities are distinct stood true, so years of service with Valley Bakery could not be attributed to the respondent.

p. 2
03

Whether the claimant was owed any outstanding dues

Holding

No outstanding claims remained unpaid

Reasoning

The claimant had taken his 28 days' annual leave per the termination notice and been paid Ksh.30,000. Notice pay was already covered by the notice issued. The court therefore found no outstanding claims and dismissed the suit with costs to the respondent.

p. 2

Legal principles established

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  • An employer carrying out a redundancy must comply with the mandatory provisions of section 40 of the Employment Act, 2007, failing which the termination is unfair
  • Where services are found superfluous, notice is issued and section 40 is complied with, there is no unfair termination

Court orders

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  1. 1.The claims made are dismissed
  2. 2.Costs to the respondent
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (first-instance employment cause)

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, "Simon Kiprop Mulwo v Valley Confectionary Limited [2020] KEELRC 1045 (KLR)", Case Analysis (2020). Cause No. 122 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/1045/eng@2020-05-21

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