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ELRCPartially AllowedEmployment and Labour Relations Court at Nairobi, Memorandum of Claim dated 3rd August 2018 (number not stated in the judgment text)· [2023] KEELRC 2982 (KLR)

Kimani v Copy Cat Limited (Employment and Labour Relations Cause 1386 of 2018) [2023] KEELRC 2982 (KLR)

Employment and Labour Relations Court
15 November 2023
2,190 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~9 min to read original · ~4 min brief

The bottom line

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A Kenyan court awarded an employee three months' salary after ruling her employer's redundancy was unfair because the employer couldn't prove valid reasons or fair selection.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent from 30th October 2015 as a Service Delivery Lead, was declared redundant by letter dated 9th May 2017, with termination taking effect on 8th June 2017. She claimed the redundancy was unprocedural, discriminatory and contrary to the Employment Act, the Constitution and fair labour practices, because no consultative meeting preceded the termination letter and no basis was given for selecting her. The Respondent defended the redundancy as necessitated by market volatility and financial hardship, asserting compliance with section 40 of the Employment Act, notice to the Labour Office, a consultative meeting on 11th May 2017, a 'last in first out' selection criterion, and payment of terminal dues of Kshs 289,667. The parties proceeded by written submissions. Applying the Court of Appeal decisions in Kenya Airways v Aviation & Allied Workers Union and Cargill Kenya v Mwaka, the court framed two issues: substantive justification and selection criteria. It found the Respondent failed to prove the operational requirements said to justify the redundancy, did not explain why only the Claimant's role was targeted, and produced no list of employees considered, so the selection criteria could not be shown to have been objectively, uniformly and fairly applied. The redundancy was therefore held unfair and unlawful. Judgment was entered for the Claimant with compensatory damages of three months' salary under section 49 of the Employment Act, totalling Kshs 330,000, plus costs and interest at court rates from the date of judgment. Other terminal dues were noted as already paid.

Key legal issues

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01

Substantive justification for redundancy

Holding

The Respondent failed to prove a valid and fair reason based on operational requirements; it did not prove the alleged market volatility and financial decline or that the Claimant was aware of them

Reasoning

Relying on Kenya Airways v Aviation & Allied Workers Union, the court held that section 40(1) must be read with sections 43, 45 and 47(5) of the Employment Act, requiring the employer to prove a valid, fair reason based on operational requirements and fair procedure. Although the Respondent pleaded market volatility and financial hardship, it adduced no proof of decline in operations, and never explained why only the Claimant's role was targeted.

p. 4
02

Selection criteria for redundancy

Holding

The selection criteria were not proved; the Respondent produced no list of employees considered alongside the Claimant, so it could not show the criteria were objectively, uniformly and fairly applied

Reasoning

Applying Maraga JA's holding in Kenya Airways and Cargill Kenya Limited v Mwaka, the court reiterated that last-in-first-out is not mandatory but any criteria used must include the section 40(1)(c) factors and be objectively, uniformly and fairly applied. The Respondent's asserted 'last in first out' criterion was not demonstrated by evidence, and the consultative meeting focused only on the Claimant.

p. 5
03

Whether the termination was unfair and unlawful

Holding

The termination on account of redundancy was unfair and unlawful; judgment was entered for the Claimant with compensatory damages of three months' salary under section 49 of the Employment Act

Reasoning

Having failed on both substantive justification and procedure, the Respondent did not discharge the burden under sections 40, 43 and 47(5). The court awarded compensation equivalent to three months' salary (Kshs 330,000), taking into account the Claimant's service of less than two years and that her other terminal dues had been paid.

p. 5

Legal principles established

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  • Redundancy is a legitimate ground for terminating employment only where the employer proves a valid and fair reason based on operational requirements and a fair procedure, including compliance with section 40 of the Employment Act
  • The selection criteria for redundancy must be proved to have been objectively, uniformly and fairly applied, and the employer need not always apply last-in-first-out

Court orders

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  1. 1.Judgment entered in favour of the Claimant
  2. 2.Claimant awarded compensatory damages equivalent to 3 months' salary, totalling Kshs 330,000/-
  3. 3.Costs awarded to the Claimant
  4. 4.Interest at court rates from the date of judgment until full payment

Authorities

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Legislation

  • Employment Actsection 40(1)(a)-(g)
  • Employment Actsection 43(2)
  • Employment Actsection 47(5)
  • Employment Actsection 45
  • Employment Actsection 49
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B
  • Constitution of KenyaArticle 159(2)(d)
  • Constitution of KenyaArticle 48

Cases cited (2)

  • Kenya Airways Limited v Aviation & Allied Workers Union Kenya & 3 others
    [2014] eKLR
  • Cargill Kenya Limited v Mwaka & 3 others
    (Civil Appeal 54 of 2019) [2021] KECA 115 (KLR) (22 October 2021)
Jurisdiction invoked
Original employment and labour relations jurisdiction under Article 162(2) of the Constitution and the Employment Act (not expressly cited; claim brought under the Employment Act, Constitution and fair labour practices)

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, "Kimani v Copy Cat Limited (Employment and Labour Relations Cause 1386 of 2018) [2023] KEELRC 2982 (KLR)", Case Analysis (2023). Employment and Labour Relations Court at Nairobi, Memorandum of Claim dated 3rd August 2018 (number not stated in the judgment text). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/2982/eng@2023-11-15

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