Milton Muyodi Maloba v Crown Paints Kenya Limited [2018] KEELRC 1373 (KLR)
The bottom line
#A Kenyan court ruled that skipping mandatory redundancy notice makes a dismissal unfair, but employees cannot claim salaries for their contract's unexpired years.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.whether the termination of the Claimant's contract on account of redundancy was unfair and appropriate remedies
Key legal issues
#Procedural fairness of redundancy under section 40 of the Employment Act, 2007
The termination was procedurally unfair because the Claimant was not given the requisite one month advance written notice of redundancy
Section 40 requires one month advance written notice to a non-unionised employee and notice to the local Labour Officer. The Labour Officer was notified by letter dated 1 February 2014, but the Claimant only received a termination letter on 27 March 2014 effective 31 March 2014. The Respondent's witness conceded in cross-examination that written notice was not given, contrary to the mandatory notice requirement in Thomas De La Rue.
Lost income to the end of a fixed-term contract
Such relief is not tenable absent express contractual agreement or direct statutory provision
The Claimant relied on Ruth Gathoni Ngotho v PCEA Foundation and Francis Lawrence Oyatsi v Nzoia Sugar Co. Ltd, while the Respondent cited contrary authority. The court endorsed the persuasive Supreme Court of Uganda decision in Bank of Uganda v Tinkamanyire that compensation for the unexpired remainder of a terminated contract is unattainable in law, and declined the Kshs 7,400,000/- claim.
Appropriate remedies for unfair redundancy
Compensation equivalent of 3 months gross wages for about 2 years of service, pay in lieu of notice based on basic pay, and accrued leave as computed by the employer
Gross pay is relevant for compensation under section 49(1)(c), while basic pay applies to pay in lieu of notice. Considering length of service of about 2 years, 3 months gross wages (Kshs 555,000/-) was awarded. Pay in lieu was admitted as outstanding, and accrued leave of Kshs 83,333/- was accepted on the employer's computation as custodian of records.
Legal principles established
#- Notice of redundancy to a non-unionised employee is mandatory under section 40 of the Employment Act, 2007, and failure to give it renders the redundancy procedurally unfair
Court orders
#- 1.Compensation of Kshs 555,000/- (equivalent of 3 months gross wages)
- 2.Pay in lieu of notice of Kshs 125,000/-
- 3.Accrued leave of Kshs 83,333/-
- 4.Total award of Kshs 763,333/- to the Claimant
- 5.Claimant to have costs
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (first-instance employment cause)
Relief refused
#Lost income to end of the fixed-term contract (Kshs 7,400,000/-)
The court held that unless there is express contractual agreement or a statutory provision, compensation for the remainder of a terminated contract is not available in law
Salary for March 2014
The Claimant was paid salary up to 31 March 2014, so nothing turned on this head
Kshs 507,966/- on account of a car purchased on a loan advanced by the Respondent
The dispute over the car loan was compromised by a consent filed by the parties on 3 September 2014
Damages for unfair termination beyond the statutory compensation awarded
The court instead awarded compensation under section 49(1)(c) and pay in lieu of notice under the statutory framework
Costs
Claimant to have costs.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
this Court concludes that the termination of the Claimant's contract on account of redundancy was procedurally unfair as the requisite notice was not given to the Claimant
the contention that an employee whose contract of employment is terminated prematurely or illegally should be compensated for the remainder of the years or period when they would have retired is unattainable in law
Gross pay becomes relevant only when assessing compensation under section 49(1)(c) of the Employment Act, 2007. The basic pay applies when assessing pay in lieu of notice.
The Court finds and holds that the termination of the Claimant's employment on account of redundancy was unfair and awards him
Claimant to have costs.
Issues in the judgment
#The judgment refers to the Claimant as both male and female - paragraph 9 states 'The Claimant filed her submissions' while the Claimant (Milton Muyodi Maloba) is elsewhere referred to as 'he' and awarded 'him'
Hearing dates are internally inconsistent - the Respondent's HR Manager is said to have testified on 18 June 2016 and the case adjourned, yet the Respondent is later said to have closed its case 'on 18 June 2018' after an adjournment described as following the same 2016 date
The court awarded pay in lieu of notice of Kshs 125,000/- although the Claimant had sought Kshs 185,000/- as one month's salary; the judgment explains the reduction only implicitly via the basic-pay versus gross-pay distinction
Compensation computation: gross salary is recorded as 'Kshs 185,000/0' (apparent typographical error) while 3 months' gross wages were computed as Kshs 555,000/-
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Milton Muyodi Maloba v Crown Paints Kenya Limited [2018] KEELRC 1373 (KLR)", Case Analysis (2018). Not stated in the judgment (Cause instituted on 23 April 2014). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/1373/eng@2018-07-27
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.