Chohan v XML Technologies & another (Cause E409 of 2024) [2025] KEELRC 1891 (KLR)
The bottom line
#Kenya's Employment Court ruled that paying salary in lieu of notice does not replace the mandatory redundancy notice under Section 40 of the Employment Act.
What this practically means
#Executive summary
#Key legal issues
#Whether there was a mutual separation between the parties
No mutual separation; the Claimant had no say in the terminal dues paid
The email correspondence showed the Claimant merely following up on final dues and requesting a revision of compensation, which the 1st Respondent declined, stating it was covering only what Kenyan legislation required. Payment was made unilaterally, so the alleged mutual separation agreement and estoppel defence failed.
Substantive justification for the termination
Valid and fair reason existed - termination of the service agreement between the 1st and 2nd Respondents, tied to the employment contract's termination clause
The termination letter cited termination of the service agreement with Zebra Technologies Europe Limited. The employment contract expressly acknowledged that termination of the client agreement was acceptable grounds for termination. The reason fell within operational requirements under Section 45(2)(b)(ii) and the statutory definition of redundancy.
Procedural fairness of the redundancy
Procedurally flawed - no notice of intention to declare redundancy as required by Section 40(1)(a) and (b), and no notification of the labour office
The Claimant was notified of the termination on the same day it took effect, with a final notice rather than notice of an intention to declare redundancy, and no evidence existed that the labour office was notified. However, the selection criteria were inapplicable as he was the sole Senior Channel Account Manager, and the statutory payments under Section 40(1)(e),(f),(g) were made.
Entitlement to reliefs
Only two months' gross salary as compensatory damages awarded; service pay and gratuity declined
Since there was a valid reason but flawed procedure, the award was nominal at two months' gross salary. Service pay was barred by Section 35(6) as the Claimant contributed to NSSF, and gratuity had no contractual or pleaded basis. Reinstatement was not granted.
Legal principles established
#- Termination on grounds of redundancy must be both substantively justified and procedurally fair
- Payment of salary in lieu of notice does not supplant the statutory notice requirement under Section 40(1)(a) and (b) of the Employment Act
- An employer must prove that the reason for termination is valid, fair and based on operational requirements, failing which the termination is unfair under Section 45(2)(b)(ii)
Court orders
#- 1.Judgment entered against the 1st Respondent awarding the Claimant compensatory damages of Kshs 1,029,600.00, equivalent to two months' gross salary
- 2.Interest on the award at court rates from the date of Judgment until payment in full
- 3.Costs of the suit awarded to the Claimant
- Jurisdiction invoked
- Original employment and labour relations jurisdiction of the Employment and Labour Relations Court (Employment Act, 2007)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Chohan v XML Technologies & another (Cause E409 of 2024) [2025] KEELRC 1891 (KLR)", Case Analysis (2025). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1891/eng@2025-06-27
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.