D’ Silva v Lordship Africa Fund Management Limited (Employment and Labour Relations Cause E567 of 2020) [2024] KEELRC 2706 (KLR)
The bottom line
#A Kenyan court awarded Ksh 3.68 million to an operations manager because her employer couldn't prove her redundancy was genuine or legally proper.
What this practically means
#Executive summary
#Key legal issues
#Whether there were valid grounds for the redundancy
No valid reason was proved; the claimant's position remained and her roles were taken over by others, while the respondent could not show steps to absorb her elsewhere.
The claimant testified that only her role was declared redundant, that she had asked to be reassigned to duties of a resigned colleague, and that the respondent instead advertised for a financial controller and hired someone else. The court found the respondent failed to rebut this credible evidence and could not explain what became of her position or what tangible steps were taken to absorb her, so the redundancy was not a genuine operational necessity.
Whether due procedure under section 40 of the Employment Act was followed
Procedure was not followed; the respondent could not prove that the labour office was notified at least one month before the termination.
The respondent exhibited a notice of redundancy allegedly issued to the labour office, but produced no evidence of postage and the labour office itself disputed receipt. The court held the respondent failed to demonstrate compliance with the one-month notification requirement, and thus violated sections 40, 41 and 45 of the Employment Act.
What remedies the claimant is entitled to
The court awarded 2 months' salary as compensation under section 49(4), plus medical cover, 2019 bonus, unpaid January 2020 salary, leave balance, severance pay, two months' salary in lieu of notice, and a certificate of service.
Applying the section 49(4) factors, the court noted the claimant had roughly 9 months left on her contract, did not contribute to the termination, had not obtained alternative employment and lacked a certificate of service. It therefore limited compensation for the unfair termination to the equivalent of 2 months' salary (Ksh 984,276) while awarding the uncontested contractual dues from the exit package and the proved medical and bonus claims.
Breach of contractual medical cover
The respondent's failure to renew the claimant's medical insurance breached her contract; the claim of Ksh 250,000 was proved.
The claimant gave uncontroverted evidence that in December 2019 she was unable to use her medical insurance card for treatment and a procedure because the cover had expired and was not renewed by the employer. RW1 confirmed the cover had lapsed. The court held this refusal breached the contractual terms and conditions of employment and awarded the claimed sum.
Legal principles established
#- Redundancy is a legitimate ground for terminating employment only where there is a valid and fair reason based on operational requirements and a fair procedure is followed.
- An employer declaring redundancy must strictly comply with the notification and payment requirements of section 40 of the Employment Act, including notification of the labour officer at least one month before termination.
- Where the employer fails to prove a valid reason and strict procedural compliance, the termination is unlawful and unfair under sections 40, 41 and 45 of the Employment Act.
Court orders
#- 1.A declaration that the termination of the claimant by the respondent was unfair and unlawful
- 2.2 months' salary in compensation for unlawful and unfair termination in the sum of Ksh. 984,276
- 3.Bonus for the year 2019 in the sum of Ksh. 492,138
- 4.Unpaid medical cover for the claimant and one dependent in the sum of Ksh. 250,000
- 5.Unpaid salary for Jan 2020 of Ksh. 317,508.39 as per exit package
- 6.Leave balance of Ksh. 341,918.73 as per exit package
- 7.Severance pay in the sum of Ksh. 307,255.91 as per exit package
- 8.Two months salary in lieu of notice of Ksh. 984,276 as per exit package
- 9.Certificate of service to be granted forthwith
- 10.Total award of Ksh. 3,677,373.03
- 11.Interest at court rates from date of judgment till payment in full for items b, c, d
- 12.Costs awarded to the claimant for the suit
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act 2007 (sections 2, 40, 41, 43, 45, 49 applied)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "D’ Silva v Lordship Africa Fund Management Limited (Employment and Labour Relations Cause E567 of 2020) [2024] KEELRC 2706 (KLR)", Case Analysis (2024). Not stated in the judgment text provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2706/eng@2024-11-04
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.