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ELRCPartially AllowedNot stated in judgment (Cause filed 19 August 2013)· [2018] KEELRC 1520 (KLR)

Esther Ndinda Musyimi v H Young & Company (EA) Limited [2018] KEELRC 1520 (KLR)

Employment and Labour Relations Court
13 July 2018
710 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court ruled the employer's redundancy unfair because it skipped mandatory notice to the employee and Labour Officer, awarding Kshs 264,006.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent on 30 April 2008 as a Data Officer and later elevated to Administrator, was terminated by letter on 8 July 2013. She sued on 19 August 2013 alleging unlawful and unfair termination and/or redundancy and non-payment of terminal benefits. The Respondent pleaded lawful termination on account of redundancy. At the hearing on 17 May 2018 the Claimant testified and closed her case; the Respondent's request for an adjournment was declined and it closed its case without leading evidence. The Court adopted the issues identified by the Claimant. It accepted, as the employer knows the real reason for termination, that the separation was redundancy on operational requirements. Under section 40 of the Employment Act, 2007 the Respondent was obliged to give the Claimant one month's written notice and to notify the local Labour Officer; it did neither, and following Thomas De La Rue (K) Ltd v David Opondo Omutelema the notices are mandatory, so the termination was procedurally flawed. Under sections 43 and 45 the Respondent also failed to prove valid and fair operational reasons, making the termination substantively unfair. Leave pay, July 2013 salary and notice pay had already been paid as terminal dues. The Court awarded severance pay of Kshs 66,000/- and compensation equivalent to six months' gross wages (Kshs 198,006/-), totalling Kshs 264,006/-, with costs to the Claimant. Judgment delivered in Nairobi on 13 July 2018 by Radido Stephen, Judge.

Key legal issues

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01

Procedural fairness of redundancy termination

Holding

Termination was procedurally flawed because the employer failed to give the employee one month's written notice and to notify the local Labour Officer as required by section 40 of the Employment Act, 2007

Reasoning

The termination letter gave no reasons; the defence advanced was re-engineering of business amounting to redundancy. Section 40 obligated the Respondent to give the Claimant one month's written notice and a similar notice to the local Labour Officer. The Respondent did not prove or suggest the notices were given, and following Thomas De La Rue, the notices are mandatory, rendering the redundancy procedurally flawed.

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02

Substantive fairness of the redundancy

Holding

The termination was substantively unfair because the employer failed to prove the redundancy was due to valid and fair operational requirements

Reasoning

Under sections 43 and 45 of the Employment Act, 2007, the employer was expected to prove that the redundancy was due to operational requirements and that the reasons were valid and fair. The Respondent closed its case without leading evidence after its adjournment request was declined, and thus discharged no evidentiary burden.

p. 2
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Remedies: severance pay and compensation

Holding

Severance pay of Kshs 66,000/- (unrebutted claim) and compensation equivalent to six months' gross wages of Kshs 198,006/- awarded

Reasoning

Section 40 entitles an employee released on redundancy to severance pay at 15 days for each year worked; the claimed Kshs 66,000/- was not interrogated by the Respondent and was allowed. Considering the length of service, six months' gross wages (Kshs 33,001/-) was appropriate compensation for the unfair termination.

p. 2

Legal principles established

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  • Notices under section 40 of the Employment Act in redundancy are mandatory

Court orders

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  1. 1.Finding that the termination of the Claimant's employment on account of redundancy was unfair
  2. 2.Award of severance pay of Kshs 66,000/-
  3. 3.Award of compensation equivalent to 6 months gross wages of Kshs 198,006/-
  4. 4.Total award of Kshs 264,006/- to the Claimant
  5. 5.Claimant to have costs of the Cause
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (employment dispute; specific reference to sections 40, 43 and 45 of 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, "Esther Ndinda Musyimi v H Young & Company (EA) Limited [2018] KEELRC 1520 (KLR)", Case Analysis (2018). Not stated in judgment (Cause filed 19 August 2013). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/1520/eng@2018-07-13

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