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ELRCPartially AllowedNot stated in the judgment provided· [2025] KEELRC 3703 (KLR)

Odhiambo & 2 others v Ona Kenya Limited & another (Cause E307 of 2025) [2025] KEELRC 3703 (KLR)

Employment and Labour Relations Court
19 December 2025
5,546 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~22 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court held a US parent company jointly liable with its Kenyan subsidiary for unfair redundancy and awarded three employees months of salary plus costs.

What this practically means

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Executive summary

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Three former employees of Ona Kenya Limited (1st Respondent) sued it and its US parent Ona Systems, Inc. (2nd Respondent) after their employment was terminated on account of redundancy on 7th March 2025, following the US Government's halt of foreign aid. They pleaded that the redundancy was unprocedural: no personal written notices, no disclosed selection criteria, and no payment in lieu of notice, severance pay or cash for outstanding leave. They sought 12 months' salary as compensation, notice pay, severance, leave dues, aggravated damages, costs and interest. The 2nd Respondent applied to be struck out, denying an employment relationship; the Court directed under Rule 59 of the ELRC (Procedure) Rules 2024 that the suit be determined on pleadings, affidavits and submissions. Three issues fell for determination. First, the Court found that the Claimants were employees of both Respondents: the 2nd Respondent's officers supervised, appraised and rewarded them, executed Confidentiality and IP Assignment Agreements with transfer provisions, and no outsourcing or service agreement between the entities was exhibited. Second, applying Section 40 of the Employment Act, the Court held the redundancy unfair: no personal written notices were issued, no selection criteria were produced, and the termination letters omitted leave pay, notice pay and severance. Third, on reliefs, the Court awarded each Claimant four months' salary as compensation for unfair termination plus one month's salary in lieu of notice, jointly and severally against both Respondents, subject to statutory deductions, with interest at Court rates from judgment and costs to the Claimants. Severance pay, leave dues and general and aggravated damages were declined - the first because compensation already covers unfair termination, and the others because they were unproved or would duplicate the compensation award.

Key legal issues

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01

Whether the Claimants had a cause of action against the 2nd Respondent

Holding

Yes - the 2nd Respondent was a joint employer of the Claimants

Reasoning

Despite formal contracts with the 1st Respondent, the Claimants were supervised, appraised, and rewarded by officers of the 2nd Respondent, shared its email domain, workspace and offices, and executed Confidentiality and IP Assignment Agreements with it permitting transfer between affiliates. The integral part of business and control tests were satisfied. No outsourcing or service agreement between the two entities was exhibited.

p. 10
02

Whether the termination of the Claimants' employment was unfair

Holding

Yes - the redundancy was procedurally flawed and unfair under Section 45 of the Employment Act

Reasoning

The Claimants were not union members and therefore had to receive personal written notices under Section 40(1)(b); none were issued. The selection criteria under Section 40(1)(c) were never produced, and termination letters were silent on leave pay, notice pay and severance contrary to Sections 40(1)(e), (f) and (g). Non-compliance with mandatory statutory conditions rendered the whole process unfair.

p. 12
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What reliefs flow from the unfair termination

Holding

Compensation of four months' salary per Claimant plus one month's notice pay; severance, leave pay and aggravated damages declined

Reasoning

The Court exercised discretion under Section 49 to award four months' salary as compensation and one month's salary in lieu of notice under Section 35(1)(c). Severance pay was refused because compensation under Section 45 already covers unfair termination; leave dues failed as unproved special damages; and general and aggravated damages would amount to a double award.

p. 12

Legal principles established

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  • Where an employee is not a member of a trade union, redundancy notification must be in writing to the employee personally and to the local labour officer
  • Failure to comply with the mandatory conditions in Section 40 of the Employment Act renders a redundancy an unfair termination under Section 45
  • An entity that exercises managerial control, appraises and rewards an employee cannot deny an employment relationship; transfer of an employee is a managerial prerogative of an employer

Court orders

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  1. 1.Judgment entered for the Claimants against the 1st and 2nd Respondents, jointly and severally
  2. 2.1st Claimant awarded Kshs.4,021,379.35 being four months' salary for unfair termination (Kshs.3,217,103.48) plus one month's salary in lieu of notice (Kshs.804,275.87)
  3. 3.2nd Claimant awarded USD 32,500 being four months' salary for unfair termination (USD 26,000) plus one month's salary in lieu of notice (USD 6,500)
  4. 4.3rd Claimant awarded USD 14,060 being compensation for unfair termination (USD 11,248) plus one month's salary in lieu of notice (USD 2,812)
  5. 5.Awarded sums subject to statutory deductions pursuant to Section 49(2) of the Employment Act
  6. 6.Interest on the awarded sums at Court rates from the date of Judgment until payment in full
  7. 7.Costs of the suit awarded to the Claimants
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment and Labour Relations Court Act and the Employment Act, 2007 (suit determined on pleadings and affidavits pursuant to Rule 59 of the ELRC (Procedure) Rules 2024)

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, "Odhiambo & 2 others v Ona Kenya Limited & another (Cause E307 of 2025) [2025] KEELRC 3703 (KLR)", Case Analysis (2025). Not stated in the judgment provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/3703/eng@2025-12-19

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