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ELRCPartially AllowedNot stated in judgment (Claim dated 14th January 2021, filed 19th February 2021)· [2025] KEELRC 1219 (KLR)

Ngure v Sheer Logic Management Consultants Limited (Cause E146 of 2021) [2025] KEELRC 1219 (KLR)

Employment and Labour Relations Court
30 April 2025
CBC. N. Baari
2,517 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court ruled that ending a driver's job because a client contract ended was a redundancy, so the employer had to follow strict redundancy rules or pay compensation.

What this practically means

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Executive summary

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The Claimant, employed as a driver on a three-month fixed-term contract from 1st July 2019, had his contract renewed for one year from 1st October 2019. On 1st November 2019, shortly into the renewed contract, the Respondent terminated his employment, citing the relocation of the expatriate he chauffeured and termination of the lease of the vehicle he drove. The Respondent maintained that it complied with the contract's clause 9(a) and section 35 of the Employment Act by issuing one month's notice, which the Claimant was slow to collect. The Claimant sued for salary for the unexpired contract term (Kshs. 532,653), contending the termination was procedurally unfair since no redundancy notice issued to him or the labour office. The court framed two issues: whether the termination was fair and whether the Claimant was entitled to the reliefs sought. It held that the termination arose from the employer's operational reasons and was therefore a redundancy, substantively justified, but that the Respondent failed to comply with the mandatory seven steps under section 40(1) of the Employment Act, rendering the termination unlawful and unfair. Relying on Kenfreight (EA) Limited v Benson K Nguti, the court held that notice alone is insufficient. Compensation of three months' salary (Kshs. 145,269) was awarded under sections 49 and 50, and the Respondent was ordered to bear the costs. The claim for the balance of the contract salary was refused as there was no guarantee of service to the contract's end.

Key legal issues

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01

Whether termination for loss of the client's contract was fair

Holding

Substantively justified as genuine redundancy, but procedurally unfair for non-compliance with section 40(1) of the Employment Act; termination unlawful and unfair

Reasoning

The court found the termination arose from the employer's operational reasons - the lease of the vehicle the Claimant drove ended - which constituted redundancy. The Respondent relied only on section 35 notice and the contract clause, but redundancy triggers the mandatory seven steps in section 40(1), including notice to the employee personally and the labour office. No such notice issued, so the termination was unlawful and unfair.

p. 5
02

Remedy for the unfair termination

Holding

Compensation of 3 months' salary (Kshs. 145,269) under sections 49 and 50 of the Employment Act; claim for balance of contract salary refused

Reasoning

Having served only four months, and considering the reason for termination, three months' salary was deemed sufficient compensation under sections 49 and 50. The claim for salary for the unexpired contract term failed because there was no guarantee the Claimant would have served to the contract's end.

Legal principles established

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  • Termination on operational grounds such as loss of a client's contract is redundancy, engaging the mandatory procedure under section 40(1) of the Employment Act
  • Notice under section 35 alone is insufficient; an employer must prove substantive justification and follow fair procedure

Court orders

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  1. 1.That the Respondent shall pay the Claimant 3 months' salary as compensation for the unfair termination at Kshs. 145,269/-
  2. 2.That the Respondent shall bear the costs of the suit from the date of this judgment until payment in full
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007

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, "Ngure v Sheer Logic Management Consultants Limited (Cause E146 of 2021) [2025] KEELRC 1219 (KLR)", Case Analysis (2025). Not stated in judgment (Claim dated 14th January 2021, filed 19th February 2021). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1219/eng@2025-04-30

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