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ELRCDismissedCause No 442 of 2017· [2020] KEELRC 1901 (KLR)

Esther Achwo Wanjohi v Athinai Estate Limited [2020] KEELRC 1901 (KLR)

Employment and Labour Relations Court of Kenya at Nakuru
13 February 2020
MMM. Mbaru
1,251 words in judgment
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The bottom line

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What this practically means

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Executive summary

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The claimant, employed as a sisal cutter from 1990 at a monthly wage of Ksh.14,000, alleged that on 26th July, 2017 the estate manager told her not to report to work as work had reduced, amounting to an unlawful verbal redundancy without notice. She sought notice pay, leave pay, unpaid salaries for May and June 2017, severance pay for 28 years and compensation. The respondent denied dismissal, asserting the claimant deserted work amid a water crisis, that a CBA-based arrangement with the union agreed to transfer sisal cutters to Lomolo estate, and that an amnesty period was offered but the claimant, a unionised shop steward, never attended. It further asserted all wages were paid through Skyline Sacco and leave was taken from 4th May, 2017. The court applied section 45(2)(b) of the Employment Act, 2007 and the Obayo and Onsoro authorities, holding that termination for operational reasons is not unfair and that employers may restructure and render positions redundant. It found the claimant confirmed reduced work, that the transfer arrangement with the union avoided lay-offs, and that her failure to attend work despite an amnesty frustrated her own employment. The wage and leave records were unchallenged. The claim was dismissed in its entirety with costs to the respondent.

Key legal issues

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01

Whether termination on operational grounds amounts to unfair termination

Holding

No; under section 45(2)(b) of the Employment Act, 2007, termination for operational reasons is not unfair, and employers have the prerogative to reorganise their businesses and render positions redundant.

Reasoning

The court applied section 45(2)(b) of the Employment Act, 2007 and adopted the reasoning in the Obayo and Onsoro authorities that employers may restructure and make positions redundant for operational, technical or reorganisation reasons. The claimant herself confirmed reduced work; the shortage of work was addressed through a transfer arrangement agreed with the union, so the process was lawful and not unfair.

p. 2
02

Whether the claimant was verbally dismissed or deserted her employment

Holding

The claimant deserted her employment; her failure to attend work after the agreed transfer arrangement frustrated her own employment.

Reasoning

The court found that the employer, facing a water crisis, agreed with the union to transfer sisal cutters to Lomolo estate, with an amnesty period for those who had failed to attend. The claimant, a unionised shop steward aware of these arrangements, declined to attend. Her absence therefore amounted to desertion, and any termination resulted from her own conduct, not the employer's unfairness.

p. 2
03

Whether terminal dues (notice pay, leave, salaries, severance, compensation) were outstanding

Holding

Nothing was outstanding; wages were paid through the Sacco, leave was taken from 4th May, 2017, and severance and notice pay did not arise.

Reasoning

The respondent produced wage payment records showing deposits to the claimant's Skyline Sacco account for days worked in May, June and July 2017, which were not materially challenged. Leave records showed annual leave taken from 4th May, 2017. Since no lay-off occurred and no unfair termination was found, severance pay, notice pay and compensation did not arise.

p. 2

Legal principles established

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  • Termination of employment due to operational reasons does not amount to unfair termination under section 45(2)(b) of the Employment Act, 2007
  • An employee who fails to attend work as required under an agreement between her trade union and the employer cannot allege unfair termination

Court orders

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  1. 1.The claim is hereby dismissed
  2. 2.Costs to the respondent

Authorities

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Legislation

  • Employment Act, 2007section 45(2)(b)

Cases cited (2)

  • Gerrishom Mukhutsi Obayo versus Dsv Air and Sea Limited
    [2018] eKLR
  • Daniel Onsoro versus Christ The King Academy St. Mary's Café
    [2018] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over employment disputes (Employment Act, 2007 invoked; section 45(2)(b) applied)

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, "Esther Achwo Wanjohi v Athinai Estate Limited [2020] KEELRC 1901 (KLR)", Case Analysis (2020). Cause No 442 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/1901/eng@2020-02-13

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