George Karanja Ngunda v Meru Water and Sewerage Services (MEWASS) Registered Trustees & 3 others [2021] KEELRC 1939 (KLR)
The bottom line
#A Kenyan court ruled a water company executive was unfairly terminated, awarding him 12 months' salary because his employer skipped mandatory redundancy steps and never gave reasons.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.What is the import of the outcome of the application dated 4th December, 2020 on this matter?
- 2.Is this a clean and clear case of redundancy?
- 3.Was the termination of the employment of the Claimant unfair, unlawful and unprocedural?
- 4.Is the Claimant entitled to the relief sought?
- 5.Who bears the costs of this cause?
Key legal issues
#Effect of the application dated 4th December, 2020 seeking review and setting aside of the judgment of 11th November, 2020
The application, compromised by consent, empowered the court to review, revise or set aside the earlier judgment and rehear the matter afresh.
The court defined review and setting aside using the Oxford and Black's Law Dictionary definitions, holding that the compromised application allowed it to revise or totally overhaul the earlier judgment and proceed to determine the claim on its merits.
Whether the termination was a lawful redundancy
No: no evidence showed compliance with Section 40 of the Employment Act, 2007, and the alleged cessation of the employer was an excuse, not the reason for termination.
The Respondents contended the 1st Respondent ceased to exist upon commencement of the Meru County Water and Sanitation Services Act, 2014. The court found the Claimant served during the operation of that Act, no Section 40 procedure was followed, and 102 of 105 employees were absorbed by the successor corporation, undermining the redundancy plea.
Whether the termination was unfair, unlawful and unprocedural
Yes: no reasons were given (breach of Section 43), no hearing was conducted (breach of Section 41), and the termination was substantively and procedurally unfair.
The termination letter gave no reasons; there was no notice or disciplinary hearing; the Claimant was not heard or considered for absorption like his 102 colleagues. The court adopted the principle that termination must satisfy both valid reason and fair procedure, failing which it is unfair under Sections 41, 43 and 45 of the Employment Act, 2007.
Whether the Claimant is entitled to the relief sought
Partially: the court issued a declaration of unfair termination, awarded 12 months' gross salary as compensation (Kshs.2,889,636), a certificate of service, and costs; the other monetary heads were not awarded.
Having established unlawful termination, the Claimant became entitled to relief, but the court exercised its discretion under the Employment Act to award the equivalent of twelve months' salary as compensation rather than the full panoply of contractual dues claimed.
Legal principles established
#- An employer relying on redundancy must strictly comply with the procedure prescribed by Section 40 of the Employment Act, 2007; absent compliance and absent evidence of redundancy, termination is unfair and unlawful.
- Termination without reasons breaches Section 43 of the Employment Act, 2007 and invalidates the termination.
- Failure to conduct a disciplinary hearing and accord an employee procedural fairness under Section 41 renders termination unlawful.
- Where an employer absorbs most employees into a successor entity but terminates a select few, the plea that the former employer ceased to exist is an excuse rather than a reason for termination.
Court orders
#- 1.A declaration that the termination of the Claimant's employment was unfair, unprocedural and unlawful
- 2.The Claimant is awarded 12 months' compensation for unlawful termination of employment - Kshs.240,803.00 X 12 = Kshs.2,889,636.00
- 3.The Respondents to issue a Certificate of Service to the Claimant within fourteen (14) days
- 4.The cost of the claim shall be borne by the Respondents
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Original jurisdiction of the Employment and Labour Relations Court over employment and labour relations disputes (Memorandum of Claim under the Employment Act, 2007)
Relief refused
#One month salary in lieu of notice (Kshs.240,803)
Not among the reliefs ultimately ordered by the court
Salary for the remainder term of the contract (Kshs.3,704,030) and other terminal dues totalling Kshs.8,320,928
The court awarded only 12 months' compensation, a certificate of service, declaration and costs
Pension, leave pay, telephone allowance, staff retreat, Christmas voucher, WASCA games allowance, 13th month salary, staff party amounts
Not granted in the final orders
Medical cover, Personal Accident Cover and Annual membership to Meru Sports Club for the remainder of the contract term
Not granted in the final orders
Costs
The cost of this claim shall be borne by the Respondents.
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.
In the absence of a demonstration of a case for redundancy and the application of Section 40 above in the management of such a case of redundancy, this court is left with no option but to deem the termination of the employment of the claimant anomalous, unprocedural, unfair and unlawful.
This inaction invalidates and illegitimacies the termination of employment.
A disciplinary hearing of the case of the employee is mandatory and in such absence, the termination of employment becomes unlawful for all intents and purposes.
Why were the other one hundred and two (102) employees not shown the door? The guess is anybodys. I therefore find and hold a case of unlawful termination of employment in the circumstances.
That the Respondent be and is hereby ordered to issue a Certificate of Service to the Claimant in fourteen (14) days from today's date.
That a declaration be and hereby issued that the termination of the Claimant's employment was unfair, unprocedural and unlawful.
That the Claimant be and is hereby awarded 12 months compensation for unlawful termination of employment- Kshs.240,803.00 X 12 months .…………………………………………………………………=Kshs.2,889,636.00
The cost of this claim shall be borne by the Respondents.
Issues in the judgment
#The passage quoted under 'Section 41' contains text from Sections 43(1) and 47(5) on burden of proof, which does not belong to Section 41; the judgment then cites 'section 45 and 45' in the Claimant's submissions. The quoted statutory text is internally inconsistent.
The claimant is stated to have been employed 'from 1st December 2016' yet later the employment contract is said to have been offered 'on or about 21st November, 2018', an internal inconsistency in the pleaded dates.
The judgment recites that a judgment dated 11th November, 2020 had earlier been delivered and was set aside on an application dated 4th December, 2020 compromised by consent; this prior judgment is not reproduced and its contents are unknown.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "George Karanja Ngunda v Meru Water and Sewerage Services (MEWASS) Registered Trustees & 3 others [2021] KEELRC 1939 (KLR)", Case Analysis (2021). Memorandum of Claim dated 10th January, 2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2021/1939/eng@2021-03-23
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.