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ELRCPartially AllowedMemorandum of Claim dated 20th February 2018· [2022] KEELRC 157 (KLR)

Showkat Hussain Badat v Oshwal Education & another [2022] KEELRC 157 (KLR)

Employment and Labour Relations Court
19 April 2022
7,325 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 awarded a former school director over Kshs. 14 million after finding his 'redundancy' dismissal lacked proper notice, consultation, and proof.

What this practically means

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Executive summary

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The Claimant, formerly Director of Academic Development and later Director of Education at Oshwal Academy-Nairobi, sued claiming that his termination by letter dated 3rd August 2017 on account of redundancy was unlawful and unfair. His fixed-term contract was due to expire on 30th April 2018, with a contractual notice period of six months or salary in lieu; he was paid only one month's notice, severance for one year of service and other terminal dues. The Respondent maintained the redundancy complied with section 40 of the Employment Act and denied any entitlement to the reliefs claimed. The court framed four issues: procedural fairness, substantive fairness, entitlement to relief and costs. On procedure, it held that the termination letter with immediate effect was not the one-month notice required by section 40(1); no separate redundancy notice was issued and no consultation took place, consultation being mandatory in Kenyan law. On substance, the Respondent failed to discharge its burden under sections 43 and 45 to prove the validity of the redundancy: no evidence of the restructure, alternatives or consultation was tendered, and the court formed the view that the true reason was disguised. The termination was declared both procedurally and substantively unfair. The court awarded eight months' gross salary (Kshs. 8,800,000) as compensation under section 49(1)(c) rather than the twelve months claimed, and five months' unpaid contractual notice pay (Kshs. 5,500,000), holding that section 40(1)(f) is a statutory minimum that cannot defeat a higher contractual entitlement. General damages for breach of contract were refused as over-compensation. Interest at court rates and costs of the suit were granted to the Claimant.

Key legal issues

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01

Procedural fairness of the redundancy

Holding

The 3rd August 2017 letter was a termination letter, not the one-month redundancy notice contemplated by section 40(1); no redundancy notice was issued and no consultation took place, so the termination was procedurally unfair.

Reasoning

Section 40(1) requires notices of not less than one month to the employee and labour officer, which elicit consultation. The letter terminated employment with immediate effect and its last day of work was 3rd August 2017, so it could not serve as notice. The Respondent's witness conceded there was no prior notice or consultation. Following Kenya Airways and Barclays Bank, two distinct notices are mandatory and consultation is implicit in the Act.

p. 8
02

Substantive fairness of the redundancy

Holding

The Respondent failed to prove the validity of the redundancy reason; the alleged restructure was not evidenced and the true reason appeared disguised, so the termination was substantively unfair.

Reasoning

Sections 43 and 45 place the burden on the employer to prove the reason for termination. The Respondent merely asserted an organizational review; no minutes, organogram or evidence of alternatives was tendered, and the HR Manager was not involved in the decision. Assertions of an operational requirement without demonstration do not satisfy the statutory measure of validity.

p. 9
03

Notice pay under contract versus section 40

Holding

The Claimant was entitled to six months' contractual notice pay; having received one month, he was owed five months' pay.

Reasoning

Clause 19 of the contract provided for six months' notice or salary in lieu. Section 40(1)(f) sets only the minimum statutory notice and cannot be invoked to deny a higher contractual entitlement; section 35(2) confirms the Act does not override contractually longer notice periods.

p. 10
04

Compensation for unfair termination

Holding

The Claimant was awarded eight months' gross salary as compensation under section 49(1)(c), less than the twelve months claimed.

Reasoning

Compensation is discretionary and the maximum of twelve months is not automatic. The court considered the extent of the Respondent's deviation from the law, the breach of fair labour practices, the disguised reason, absence of fault by the Claimant and his reasonable expectation of employment length, and fixed compensation at eight months' gross salary.

p. 10

Legal principles established

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  • The one-month notice pay under section 40(1)(f) of the Employment Act is a statutory minimum and cannot defeat a contractual entitlement to longer notice; section 40 must be read with section 35(2).
  • Consultation prior to declaration of redundancy is a requirement of Kenyan law, implicit in the Employment Act.
  • An employer asserting redundancy bears a heavy burden to demonstrate the validity of the reason, not merely to assert it.

Court orders

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  1. 1.A declaration that the termination of the Claimant's employment was both procedurally and substantively unfair
  2. 2.Compensation for unfair termination of Kshs. 8,800,000.00
  3. 3.Unpaid notice pay of Kshs. 5,500,000.00
  4. 4.Interest on compensation and notice pay at court rates from the time of filing suit until full payment
  5. 5.Costs of the suit to the Claimant

Authorities

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Legislation

  • Employment ActSection 40(1)(a)-(g)
  • Employment ActSection 35(1) and (2)
  • Employment ActSections 43 and 45
  • Employment ActSection 49(1)(c)
  • Employment ActSection 2 (definition of redundancy)
  • Labour Relations ActSection 2 (definition of redundancy)
  • Constitution of KenyaArticle 2(6)

Cases cited (14)

  • Caroline Wanjiru Luzze versus Nestle Equatorial Africa Region Limited
    [2016] eKLR
  • Francis Kamau versus Lee Construction
    [2014] eKLR
  • Hesbon Ngaruiya Waigi versus Equitorial Commerce Bank Limited
    [2013] eKLR
  • Kenya Airways Limited versus Aviation & Allied Workers Union Kenya & 3 others
    [2014] eKLR
  • Brooke house Schools Limited versus Dorcas Njeri Gichuhi
    [2016] eKLR
  • Donas Lombom & 7 others versus Civicon Limited
    [2016] eKLR
  • Stephen Munene Waititu v Kenya Tea Packers Limited & another
    [2020] eKLR
  • Margaret Mumbi Mwago versus Intrahealth International
    [2017] eKLR
  • Thomas be La Rue v David Omutelema
    [2013] eKLR
  • Barclays Bank of Kenya Ltd & another versus Gladys Muthoni & 20 others
    [2018] eKLR
  • Peter Wesonga Opaka v Hilltop Preparatory School & another
    [2019] eKLR
  • Robert Kennedy Moi v Attorney General and Another
    [2014] eKLR
  • b.K. Njagi Marete V Teachers Service Commission
    [2013] eKLR
  • John William Strauss & another Vs. Plessey (PTY) Limited
    [2002] & BLLR 755 (CC)
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007

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, "Showkat Hussain Badat v Oshwal Education & another [2022] KEELRC 157 (KLR)", Case Analysis (2022). Memorandum of Claim dated 20th February 2018. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/157/eng@2022-04-19

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