Ngunia v Charm Industries Limited (Cause 433 of 2018) [2024] KEELRC 974 (KLR)
The bottom line
#A Kenyan court ruled a redundancy unlawful because the employer skipped the proper notice and never explained how it picked the employee.
What this practically means
#Executive summary
#Key legal issues
#Compliance with Section 40 redundancy notice requirements
The termination was unlawful because the Claimant was never issued with a redundancy notice and the notice to the Labour Office was served at the wrong station; only a termination notice was given
The Court found that the Respondent admitted serving the redundancy notice on the Labour Office at Industrial Area instead of Mavoko, within whose jurisdiction the Claimant worked. The first official communication to the Claimant was a termination notice, not a redundancy notice. Relying on Thomas De La Rue and Kenya Airways, the Court held that the Section 40(1)(a) and (b) notice is distinct from the Section 40(1)(f) termination notice and that no prior consultations occurred.
Objective selection criteria under Section 40(1)(c)
The Respondent failed to demonstrate the selection criteria used to pick the Claimant, rendering the redundancy substantively suspect
The Claimant alleged he was targeted for redundancy due to a prior complaint of racial discrimination against his superiors. The Respondent admitted receiving a complaint but was obscure on details and action taken. The Court held the Claimant's concern was credible and the Respondent ought to have disclosed the actual selection criteria used; its failure left the Court guessing as to the real criteria.
Payment of statutory dues on redundancy
The Respondent complied with conditions (e), (f) and (g) of Section 40 as dues were tabulated though the Claimant declined payment
Although the Claimant refused to collect the cheque for Kshs. 61,795, the Court found there was evidence that statutory dues were tabulated and offered. It accordingly found no basis to fault the Respondent on notice pay in lieu, cashing of leave and severance pay, which claims were admitted and payable.
Legal principles established
#- The redundancy notice under Section 40(1)(a) and (b) of the Employment Act is separate and distinct from the termination notice under Section 40(1)(f)
- An employer declaring redundancy must lay before the Court the actual objective selection criteria used to select the affected employee
Court orders
#- 1.Judgment entered in favour of the Claimant for 4 months' salary in compensation of Kshs. 121,440
- 2.Notice pay of Kshs. 11,677
- 3.Leave pay of Kshs. 7,590
- 4.Severance pay of Kshs. 30,360
- 5.Total award of Kshs. 171,067 subject to statutory deductions with interest at court rates from date of judgment until payment in full
- 6.Claimant awarded costs of the case
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act, Section 40
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Ngunia v Charm Industries Limited (Cause 433 of 2018) [2024] KEELRC 974 (KLR)", Case Analysis (2024). Employment and Labour Relations Cause (Memorandum of Claim dated 27th March 2018). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/974/eng@2024-04-11
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.