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ELRCPartially AllowedNot stated in the judgment (Employment and Labour Relations Court claim, memorandum of claim filed 18.12.2015)· [2022] KEELRC 361 (KLR)

Sammy Kituyi Musiya v Consolbase Limited [2022] KEELRC 361 (KLR)

Employment and Labour Relations Court of Kenya
1 April 2022
BOByram Ongaya
2,049 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~8 min to read original · ~4 min brief

The bottom line

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A Kenyan employer cannot bypass mandatory redundancy procedures by getting an employee to sign a termination letter, the Employment and Labour Relations Court has held.

What this practically means

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Executive summary

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The claimant, employed as a clerk on 15.09.2004 and promoted to supervisor, was summarily terminated by letter dated 20.12.2012 on grounds that his position had been made redundant owing to adverse economic conditions following a restructuring meeting of 30.11.2012. He claimed notice pay, 12 months' wages for unfair termination, accrued leave, severance pay, house allowance and overtime, totaling Kshs. 1,800,545.00. The respondent defended the suit asserting termination by mutual consent following a meeting of 20.12.2012 at which the claimant's poor work relationships, high handedness and unbecoming attitude were discussed, and that the claimant signed the termination letter in acceptance. The Court found a contract of service existed from 15.09.2004 to 20.12.2012 at a gross monthly salary of Kshs. 37,700.00, and that the termination was on grounds of redundancy. It held the termination unfair: section 40's mandatory one-month notice to the employee and the labour officer was not given, and the claimant's signature on the letter did not waive those statutory requirements. The respondent's plea of mutual consent was unverifiable without minutes, and was inconsistent with the redundancy reason, confirming the claimant was unfairly targeted; the respondent failed to justify the grounds under sections 43 and 47(5). Applying section 49, the Court attributed 50% contribution to the claimant's apparent concurrence and awarded six months' gross salary (Kshs. 226,200.00) plus severance of Kshs. 150,800.00 for eight completed years, totaling Kshs. 377,000.00, less due PAYE, payable by 02.06.2022 failing interest at court rates. Claims for notice pay, leave, house allowance and overtime were declined, some as time barred under section 90. The respondent was ordered to pay 50% of the claimant's costs.

Key legal issues

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01

Whether the termination was unfair

Holding

Termination was unfair; the redundancy procedure under section 40 was not complied with and the pleaded case of misconduct was inconsistent with the stated reason of redundancy.

Reasoning

The termination letter cited redundancy but no one-month notice was issued to the claimant or the labour officer. The respondent's defence of mutual consent based on alleged misconduct was unverifiable without minutes, and contradicted the redundancy reason, confirming the claimant was unfairly targeted.

p. 2
02

Burden of justifying termination under sections 43 and 47(5)

Holding

The respondent failed to prove that the reason stated in the termination letter existed and was valid and genuine at the time of termination.

Reasoning

Section 47(5) requires the claimant to establish unfair termination, which he did; the burden then shifts to the employer to justify the grounds under sections 43 and 47(5). The respondent's shifting reasons (redundancy, then misconduct/mutual consent) failed to discharge that burden.

p. 2
03

Remedies under section 49

Holding

Award of 6 months' gross salary (Kshs. 226,200.00) plus severance pay of Kshs. 150,800.00, total Kshs. 377,000.00, with 50% contribution attributed to the claimant.

Reasoning

Applying section 49 factors, the claimant's apparent concurrence by signing the termination letter may have significantly contributed to the termination, justifying 50% contribution. His clean record and desire to remain employed favoured compensation; severance was due under section 40 for 8 completed years.

p. 2

Legal principles established

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  • An employee's signing of a termination letter in acceptance of its contents does not waive the employer's mandatory obligations under section 40 of the Employment Act on redundancy.
  • Termination on grounds of misconduct or poor performance requires notice and hearing under section 41 of the Employment Act.
  • An employer claiming termination by mutual consent must prove it; unproduced minutes and an uncalled witness render the alleged meeting unverifiable.

Court orders

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  1. 1.The respondent to pay the claimant a sum of Kshs. 377,000.00 (less due PAYE) by 02.06.2022 failing interest at Court rates from the date of judgment until full payment
  2. 2.The respondent to pay 50% of the claimant's costs of the suit

Authorities

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Legislation

  • Employment Act, 2007section 40
  • Employment Act, 2007section 41
  • Employment Act, 2007section 43
  • Employment Act, 2007section 47(5)
  • Employment Act, 2007section 49
  • Employment Act, 2007section 2 (definition of redundancy)
  • Employment Act, 2007section 31(2)(a)
  • Employment Act, 2007section 90
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (first-instance claim for unfair termination)

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, "Sammy Kituyi Musiya v Consolbase Limited [2022] KEELRC 361 (KLR)", Case Analysis (2022). Not stated in the judgment (Employment and Labour Relations Court claim, memorandum of claim filed 18.12.2015). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/361/eng@2022-04-01

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