Bikeri v Kiamokama Tea Factory Ltd (Cause E044 of 2023) [2024] KEELRC 1248 (KLR)
The bottom line
#A Kenyan court found a tea worker's redundancy unfair because the employer proved no real reason for it, awarding him ten months' pay.
What this practically means
#Executive summary
#Key legal issues
#Procedural fairness of the redundancy
The redundancy was substantially procedurally fair because notices were given to the trade union, the Claimant and the County Labour Officer, even though the Claimant did not receive the full 30 days' notice.
Section 40(1) of the Employment Act requires an employer to give the employee or trade union, and the Labour Officer, written notice of at least 30 days. The Respondent gave a notice of intended redundancy to the union on 1 September 2022, copied to the County Labour Officer, and issued a letter to the Claimant releasing him from 31 October 2022. The Respondent paid 2 months' salary in lieu of notice instead of the 30 days' notice, but the Court held the process substantially fair as the requisite notices were given.
Substantive fairness of the redundancy
The Respondent failed to prove the validity or fairness of the reasons for terminating the Claimant's employment.
Sections 43 and 45 of the Employment Act place the burden on the employer to prove valid and fair reasons for termination. The Respondent pleaded unsustainable high wage costs as the reason for the release but, apart from pleading and asserting it, placed no records or material before the Court to support that contention. Mere assertions do not discharge the statutory burden of proof.
Compensation for unfair termination
The Claimant was awarded the equivalent of 10 months' gross wages (Kshs 85,605/- gross salary), i.e. Kshs 856,050/-.
The Respondent had already paid terminal dues including severance pay, gratuity, salary in lieu of notice, accrued leave and Provident Fund contributions. The Claimant had served for about 19 years, from 2003 to 2022. Considering these factors, the Court found 10 months' gross wages to be just compensation under section 49 of the Employment Act framework.
Service pay
The Claimant was not eligible for service pay because he was a member and contributor to a Provident Fund and the NSSF.
The Claimant claimed Kshs 1,712,100/- as service pay. The evidence showed he was a member and contributor to a Provident Fund as well as the National Social Security Fund. Under section 35(5) and (6) of the Employment Act, an employee who is a member of a provident fund or a scheme such as NSSF is not entitled to service pay, so this head of claim failed.
Legal principles established
#- Payment of salary in lieu of notice does not cure an employer's failure to give the employee the 30-days' notice required by section 40(1) of the Employment Act; however, where the requisite notices were given to the union, the employee and the Labour Officer, the redundancy process is substantially procedurally fair.
- An employer bears the burden under sections 43 and 45 of the Employment Act to prove valid and fair reasons for termination by placing records or material before the Court, not mere assertions.
- An employee who is a member of and contributor to a Provident Fund and the NSSF is not eligible for service pay under section 35(5) and (6) of the Employment Act.
Court orders
#- 1.Finding that the termination of the Claimant's employment was unfair
- 2.Award of compensation equivalent to 10 months' gross wages, Kshs 856,050/-
- 3.The award to attract interest at court rates from date of judgment if not paid within 30 days
- 4.Other heads of claim dismissed
- 5.Claimant awarded costs on half-scale as he partially succeeded
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction over employment and labour relations disputes (Employment Act, 2007)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Bikeri v Kiamokama Tea Factory Ltd (Cause E044 of 2023) [2024] KEELRC 1248 (KLR)", Case Analysis (2024). Not stated in the judgment text provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1248/eng@2024-05-15
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.