Ndiege v M.J Awale and Crown Bus Services Ltd (Cause 322 of 2017) [2022] KEELRC 1606 (KLR)
The bottom line
#Kenya's Employment Court upheld a bus company's retrenchment of a security officer, ruling the employer proved genuine financial hardship and followed the required redundancy procedure.
What this practically means
#Executive summary
#Key legal issues
#Whether there was a valid and fair substantive reason for the redundancy
Yes - the respondent proved financial difficulties through correspondence showing loss of customers, loss of income and high rent, justifying the retrenchment
The Court examined letters to Lloyd Masika Limited and the Traffic Police showing the business was severely hampered by road obstruction, loss of customers and high rental costs, and that the respondent had issued notice to vacate premises. The claimant's assertion that the respondent was expanding its fleet was unsubstantiated. Following Kenya Airways, the employer's genuine belief in a redundancy situation suffices; the court has no supervisory role over business decisions. Ten co-workers were also declared redundant.
Whether the termination complied with the procedural requirements of section 40(1) of the Employment Act
Yes - the respondent complied with sections 40(1)(b), (f) and (g); clause (e) was inapplicable as no leave was outstanding
The respondent issued a one-month notice of redundancy dated 6th January 2017, notified the county labour office, and exhibited a tabulation of dues including notice pay, salary for January days worked and severance pay. The 30-day notice period was intact despite not starting on the first of the month. The claimant had taken leave in December 2015, so no leave was due under clause (e). Substantial compliance was found, echoing Githinji JA in Kenya Airways.
Whether the claimant is entitled to the reliefs sought
No - having found the termination fair and lawful, the claimant is entitled to none of the reliefs sought
Because both substantive reason and procedure were found fair and lawful, the unfair termination claim failed in its entirety. The claimant was left only with the right to collect the terminal dues tabulated by the respondent, which he had refused to collect. Costs were ordered on the basis that each party bears its own.
Legal principles established
#- An employer must prove a valid and fair reason based on operational requirements and fair procedure to justify termination on redundancy
- The court will not substitute its own economic reasoning for that of the employer in redundancy decisions
- It is lawful even in apparently successful enterprises to reduce staff as a cost-saving measure
- A 30-day redundancy notice need not begin on the first day of the month so long as the full 30-day period is not reduced
Court orders
#- 1.The claim is dismissed in its entirety
- 2.Each party shall bear its own costs
- 3.The claimant is at liberty to collect the terminal dues tabulated by the respondent
- Jurisdiction invoked
- First-instance employment claim under the Employment Act; Article 159(2)(d) and Article 48 of the Constitution referenced on mode of delivery
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Ndiege v M.J Awale and Crown Bus Services Ltd (Cause 322 of 2017) [2022] KEELRC 1606 (KLR)", Case Analysis (2022). Cause No 322 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/1606/eng@2022-07-29
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.