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ELRCPartially AllowedCause No 1322 of 2016· [2022] KEELRC 671 (KLR)

John Mukosi Kioki & 3 others v Primi Piatti Limited & another [2022] KEELRC 671 (KLR)

Employment and Labour Relations Court
24 February 2022
4,486 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~18 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled that firing workers as redundant without proper notices and consultation is unfair termination, awarding the employees compensation.

What this practically means

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Executive summary

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Four Claimants sued the Respondents alleging illegal and unlawful termination in October 2015 without terminal dues, underpayment contrary to the Regulation of Wages Orders, and non-compliance with Section 40 of the Employment Act in a purported redundancy. The 1st, 2nd and 3rd Claimants were waiters of the 1st Respondent earning Kshs.12,000/- gross per month; the 4th Claimant was a baker with the 2nd Respondent earning Kshs.9,700/-. The Respondents asserted the Claimants were declared redundant on closure of the hotel business, were aware of it, and accepted their dues, but led no evidence at trial. The Court found the purported redundancy neither substantively justified nor procedurally fair: there was no evidence of the reasons and extent of the redundancy, no notices to the employees or the Labour Officer, and no consultation, contrary to Section 40 and the requirement of meaningful pre-redundancy consultation grounded in Article 41 of the Constitution. The 1st, 2nd and 3rd Claimants were awarded compensation under Section 49(1)(c) of five months' gross salary for the 1st Claimant and three months' each for the 2nd and 3rd, plus underpayment from May 2013 to October 2015; the claim for underpayment before May 2013 failed for want of a Wage Order, and severance pay was declined. The 4th Claimant's claim was dismissed, his evidence on the date and circumstances of termination being contradictory and unconvincing, and he admitted giving false testimony. Judgment was entered for the 1st, 2nd and 3rd Claimants against the 1st Respondent with costs and interest at Court rates from the date of judgment until payment in full.

Key legal issues

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01

Whether the 1st, 2nd and 3rd Claimants were lawfully declared redundant

Holding

The termination was neither substantively justified nor procedurally fair; the 1st Respondent led no evidence of compliance with Section 40 of the Employment Act

Reasoning

The Respondents adduced neither documentary nor oral evidence. Although the defence asserted the Claimants were informed of the redundancy, no evidence supported this. The only reference to redundancy was Kshs.6,000/- designated as such on payslips. Without any evidence of restructuring necessitating redundancy, of notices to employees or the labour officer, or of consultation, the Respondent failed to discharge the heavy burden placed on an employer to justify termination.

p. 6
02

Whether pre-redundancy consultation is required under Kenyan law

Holding

Yes - the majority decision in Kenya Airways v Aviation & Allied Workers Union and Barclays Bank require meaningful pre-redundancy consultations

Reasoning

The Respondent relied exclusively on the dissenting judgment in Kenya Airways Ltd v Aviation & Allied Workers Union to argue that Kenyan law does not require consultations before redundancy. The Court held that the majority judgment held otherwise, and this was reinforced by the Court of Appeal in Barclays Bank, which grounded the requirement in Article 41 of the Constitution and fair labour practices. The Court is bound by these pronouncements.

p. 6
03

Whether the 4th Claimant proved unfair termination

Holding

He did not - his evidence was contradictory and he admitted giving false testimony, making it unsafe to rely on

Reasoning

The 4th Claimant gave three inconsistent dates of termination (October 2015, 2nd February 2016 and 5th February 2016), admitted on cross-examination that he had given false testimony, and only filed the September 2015 payslip. Under Section 47(5) of the Employment Act the burden of proving unfair termination rests on the employee. Given the contradictions and admission, the Court found it unsafe to rely on his evidence and dismissed his claim.

p. 7
04

Entitlement to remedies for the 1st, 2nd and 3rd Claimants

Holding

Underpayment from May 2013 to October 2015 awarded; compensation under Section 49(1)(c) of 5 months' salary for the 1st Claimant and 3 months' each for the 2nd and 3rd Claimants; severance declined

Reasoning

The Regulation of Wages Orders 2013 and 2015 established the salaries were below the prescribed minimum with no house allowance, but no Order was produced for the period before May 2013. For compensation, the Court considered that the Claimants did not contribute to the termination, had served about five and three years respectively, and the Respondents tendered no evidence. Severance pay under Section 40(1)(g) was declined as the redundancy was unfair and the Claimants were NSSF members.

Legal principles established

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  • Section 40(1) of the Employment Act mandatorily requires compliance with seven conditions before termination on account of redundancy
  • The employer bears a heavy burden of proof to justify termination of employment, including proof of the reasons and extent of redundancy
  • Meaningful pre-redundancy consultations are required under Article 41 of the Constitution and fair labour practices
  • Burden of proving unfair termination rests on the employee while the burden of justifying the grounds for termination rests on the employer

Court orders

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  1. 1.Judgment entered in favour of the 1st, 2nd and 3rd Claimants against the 1st Respondent with costs and interest at Court rates from the date of judgment till payment in full
  2. 2.1st Claimant awarded Kshs.68,030 compensation for unfair termination plus Kshs.48,180 salary underpayment (total Kshs.108,210)
  3. 3.2nd Claimant awarded Kshs.40,818 compensation for unfair termination plus Kshs.48,180 salary underpayment (total Kshs.88,998)
  4. 4.3rd Claimant awarded Kshs.40,818 compensation for unfair termination plus Kshs.48,180 salary underpayment (total Kshs.88,998)
  5. 5.Claim by the 4th Claimant dismissed

Authorities

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Legislation

  • Employment ActSection 2
  • Employment ActSection 40, 40(1), 40(1)(g)
  • Employment ActSection 41
  • Employment ActSection 47(5)
  • Employment ActSection 49(1)(c)
  • Wage Guidelines Legal Notices 117 of 2015 and Legal Notice No. 197 of 2015
  • Regulation of Wages (General) (Amendment) Order 2013
  • Regulation of Wages (General) (Amendment) Order 2015
  • Constitution of Kenya, 2010Articles 41, 48, 159(2)(d)
  • Civil Procedure ActSection 1B
  • Civil Procedure RulesOrder 21 Rule 1

Cases cited (6)

  • Kenya Airways Corporation Ltd v Tobias Oganya Auma & 5 Others
    [2007] eKLR
  • Kenya Airways Limited v Aviation & Allied Workers Union Kenya & 3 others
    [2014] eKLR
  • Kenya Airline Pilots Association and Kenya Airways Limited
    Cause No. 94 of 1993
  • Freight In Time Limited v Rosebell Wambui Munene
    [2018] eKLR
  • Kenafric Industries Limited v John Gitonga Njeru
    [2016] eKLR
  • Barclays Bank of Kenya Ltd & another v Gladys Muthoni & 20 others
    [2018] eKLR
Jurisdiction invoked
Original employment and labour relations jurisdiction (Employment Act, 2007; memorandum of claim under the Employment and Labour Relations Court procedure)

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, "John Mukosi Kioki & 3 others v Primi Piatti Limited & another [2022] KEELRC 671 (KLR)", Case Analysis (2022). Cause No 1322 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/671/eng@2022-02-24

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