Van Kappel Kenya Limited v Wanjohi (Appeal E015 of 2023) [2024] KEELRC 2193 (KLR)
The bottom line
#Kenya's Employment Court slashed a retrenched mechanic's award because skipping mandatory redundancy steps still counts as unfair termination—but excessive damages won't survive appeal.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the Appellant was condemned unheard.
- 2.Whether the retrenchment of the respondent amounted to unfair and unlawful termination.
- 3.Whether this Court should disturb the award of damages by the trial Court.
Key legal issues
#Whether the appellant was condemned unheard
The appellant was afforded an opportunity to be heard but deliberately failed to participate; raising the matter on appeal without seeking review is an afterthought.
The hearing notice was served on the appellant's counsel by email on 5th April 2023 and an affidavit of service was filed on 6th April 2023. The matter was fixed for hearing on 13th June 2023 and the appellant did not attend, nor follow up until judgment. The decision to proceed was made in June 2023, so the right of appeal against it lapsed before judgment.
Whether the retrenchment amounted to unfair and unlawful termination
The retrenchment was unfair and unlawful because the mandatory procedure under section 40 of the Employment Act was not followed.
The employer did not serve one month's prior notice on the employee or the labour officer, did not demonstrate fair selection, and did not pay salary in lieu of notice, severance pay or accrued dues. The employee bears no fault in a redundancy, and the employer must strictly comply with section 40 conditions for a lawful retrenchment.
Whether the trial court's award of damages should be disturbed
The awards were varied: compensation reduced to six months' salary, notice pay reduced to one month, severance pay of Kshs 50,000 upheld, and the award subjected to statutory deductions.
The trial court awarded the maximum 12 months' compensation without considering the section 49(4) factors such as length of service and availability of alternative employment, making the award manifestly excessive for a two-year service. The award of two months' notice pay was unsupported by evidence, while severance at fifteen days' pay per completed year for two years was correctly computed.
Legal principles established
#- A trial court must justify an award of the maximum compensation under section 49(1)(c) of the Employment Act by taking into account the relevant factors in section 49(4); failure to do so invites appellate interference.
- An employer who fails to comply with the mandatory conditions under section 40(1) of the Employment Act effects an unfair and unlawful termination on account of redundancy.
- An award made under section 49 of the Employment Act must be subjected to statutory deductions.
Court orders
#- 1.The appeal is partially successful
- 2.The appellant is ordered to pay the respondent Notice Kshs 50,000.00
- 3.Compensation Kshs 300,000.00
- 4.Severance pay Kshs 50,000.00 (total Kshs 400,000.00)
- 5.Each party to bear costs of the appeal but the award of costs in the court below remains undisturbed
- 6.Interest at court rate from the date of the impugned judgment
- 7.The award of damages is subject to statutory deduction
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- On appeal from
- Magistrates' Court (ELRC jurisdiction), Nanyuki Law Courts
- Not stated in the judgment
- Jurisdiction invoked
- First appellate jurisdiction over the subordinate court's judgment (Memorandum of Appeal dated 13th October 2023); ELRC Procedure Rules referenced
Relief refused
#Setting aside of the whole judgment and dismissal of the respondent's suit
The appellant was served with a hearing notice and deliberately failed to attend; the retrenchment was procedurally unfair, so the finding of unfair termination was upheld.
Upholding of the maximum 12 months' salary compensation
The trial court failed to consider the relevant factors under section 49(4) of the Employment Act, making the award manifestly excessive.
Upholding of the award of Kshs 100,000 as salary in lieu of notice
No evidence justified two months' salary in lieu of notice; the correct award is one month's salary.
Costs
Each party to bear costs of the appeal but the award of costs in the court below remains undisturbed.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
Consequently, I enter judgment as follows: a. The appeal is partially successful
Each party to bear costs of the appeal but the award of costs in the court below remains undisturbed.
I am satisfied that an award six (6) months gross salary as compensation for unfair and unlawful termination equaling to Kshs 300,000 is reasonable.
The award of damages is subject to statutory deduction.
An appellate court will not disturb an award of damages unless it is so inordinately high or low as to represent an entirely erroneous estimate.
Issues in the judgment
#Internal inconsistency in dates of the retrenchment letter - the background states the retrenchment letter was dated 31st May 2019, while the respondent's evidence is described as showing retrenchment by a letter dated 31st August 2019.
Submissions refer to collapse of grounds 1, 2, 3 & 9 into one issue, but the Memorandum of Appeal contains grounds (a) to (i) with no numbering matching '9' as ninth ground being cited consistently.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Van Kappel Kenya Limited v Wanjohi (Appeal E015 of 2023) [2024] KEELRC 2193 (KLR)", Case Analysis (2024). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2193/eng@2024-09-12
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.