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ELRCPartially AllowedNot stated in the judgment· [2024] KEELRC 2713 (KLR)

Shamala v Starehe Boys’ Centre & School (Employment and Labour Relations Cause E426 of 2021) [2024] KEELRC 2713 (KLR)

Employment and Labour Relations Court
25 October 2024
2,631 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~11 min to read original · ~4 min brief

The bottom line

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A Kenyan employer's Covid-19-era redundancy was ruled unfair because it skipped mandatory union notification, costing it over Kshs.591,000 plus costs and interest.

What this practically means

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Executive summary

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The claimant, employed by the respondent from 2003 and converted to a monthly salary of Kshs.17,527 plus house allowance in 2012, was terminated by letter dated 21st July 2020 during the Covid-19 pandemic. He sued for a declaration of unlawful termination, damages, notice pay, severance pay, unpaid salaries, anticipatory salaries for 13 years, aggravated and exemplary damages, interest and a certificate of service. The respondent admitted the termination but justified it on the serious and urgent circumstances created by the Covid-19 pandemic, asserting that all terminal dues were paid. The court framed three issues: whether the termination was unfair, entitlement to reliefs, and costs. It found the termination was in substance a redundancy and that the respondent breached the mandatory procedure in section 40 of the Employment Act: although the claimant was a member of COTU and KUDHEIHA, only the labour office was notified; the claimant received no notice, no hearing, no disclosure of the selection criteria, and no information on his terminal dues including severance pay. Relying on Thomas De La Rue, Walter Ogal Anuro and Daniel Mburu Muriu, the court held the termination unfair and entered judgment for the claimant. It awarded 10 months' salary as compensation (considering 12 months excessive), one month's salary in lieu of notice, severance pay of Kshs.233,979.50, and unpaid salary for July and August 2020, totalling Kshs.591,830.50. Anticipatory salaries were declined as unproved and unsupported in law. Costs were awarded to the claimant with interest at 14% per annum from judgment until full payment. Note: the compensation figure stated in the judgment contains an internal arithmetical inconsistency.

Key legal issues

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01

Whether the claimant was unfairly terminated

Holding

Yes - the termination was a redundancy effected in breach of the mandatory procedure in section 40 of the Employment Act; the trade unions were not notified, no proper notice was given, no hearing was accorded, and the selection criteria were not disclosed.

Reasoning

The respondent admitted the claimant was a member of COTU and KUDHEIHA, so under section 40(1)(a) both unions and the labour officer had to be notified at least one month before the redundancy. Only the labour office was notified. The claimant was neither heard nor informed of terminal dues or the selection criteria, contrary to sections 41 and 43. Substantive justification and procedural fairness are both required.

p. 5
02

Whether the claimant is entitled to the reliefs sought

Holding

Partially - the court awarded the equivalent of 10 months' salary as compensation, one month's salary in lieu of notice, severance pay, and unpaid salary for July and August 2020, but declined anticipatory salaries and allowances.

Reasoning

Having found the termination unfair, the court exercised its discretion under section 49 of the Employment Act. It held 12 months' compensation excessive and awarded 10 months. Notice pay was due under section 36. Severance pay was payable because the claimant was declared redundant. Anticipatory earnings for 13 years were speculative and unsupported in law.

p. 6

Legal principles established

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  • Where an employee is a member of a trade union, a redundancy notification must go to the union and the local labour officer at least one month before the effective redundancy date; failure to comply with section 40(1)(a) of the Employment Act renders the termination unfair.
  • For a termination of employment to pass the fairness test, there must be both substantive justification and procedural fairness.
  • An employer's right to terminate on redundancy is regulated and conditioned by sections 40, 43 and 45 of the Employment Act.

Court orders

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  1. 1.Declaration that the respondent did not terminate the claimant fairly and procedurally; judgment entered in favour of the claimant
  2. 2.Award of damages for unlawful termination equivalent to 10 months' salary of Kshs.275,270
  3. 3.One month's salary in lieu of notice of Kshs.27,527 under section 36 of the Employment Act
  4. 4.Severance pay of Kshs.233,979.50
  5. 5.Unpaid salary for July and August 2020 of Kshs.55,054
  6. 6.Total award of Kshs.591,830.50
  7. 7.Costs of the claim awarded to the claimant plus interest at court rates of 14% per annum from the date of judgment till full payment
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act (sections 36, 40, 41, 42, 43, 45, 49) and Articles 28, 41(1), 47, 48 and 50(1) of the Constitution invoked in the claim

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Shamala v Starehe Boys’ Centre & School (Employment and Labour Relations Cause E426 of 2021) [2024] KEELRC 2713 (KLR)", Case Analysis (2024). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2713/eng@2024-10-25

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.