Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
AI-generated case brief
Case Brief · caselaw.co.ke
ELRCPartially AllowedMemorandum of Claim dated 25th July 2022 (number not stated in judgment)

Kanyugo v Guru Nanak Ramgarhia Sikh Hospital (Cause E535 of 2022) [2024] KEELRC 154 (KLR)

Employment and Labour Relations Court
8 February 2024
2,165 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

#

A Kenyan court ruled a hospital's redundancy was unfair because it skipped the mandatory advance redundancy notice, awarding the employee Kshs. 750,000.

What this practically means

#

Executive summary

#
The Claimant, employed as an Internal Auditor on a two-year contract effective 1st September 2020 at a monthly salary of Kshs. 250,000, was terminated on account of redundancy by a letter dated 27th August 2021 giving three months' notice effective 1st September 2021. He claimed the termination was procedurally flawed: no written redundancy notice was issued to him or the Labour Officer, no notice pay, severance or leave pay was paid, and seniority and consultation were disregarded. He sought notice pay, leave pay, service pay and twelve months' salary as compensation. The Respondent admitted the termination but maintained it complied with Section 40 of the Employment Act, having notified the County Labour Office on 25th August 2021, issued three months' notice, paid all terminal dues, and acted fairly since the Claimant was the sole member of the Internal Audit Department, which was phased out in favour of external auditors. The court framed two issues: lawfulness and fairness of the termination, and entitlement to remedies. Applying Thomas De La Rue, Kenya Airways and German School Society, the court held that the notice of intention to declare redundancy is separate from the termination notice and is intended to enable consultation. The Respondent issued only a termination notice and notified the Labour Office a mere two days before termination, breaching Section 40(1)(a) & (b), rendering the termination unfair under Section 45. However, the selection criteria and payment of dues were faultless. The court awarded three months' salary (Kshs. 750,000) as compensation with interest from the date of judgment, and costs to the Claimant. Claims for notice pay, leave pay and service pay were abandoned at trial.

Questions the Court framed

#

The issues the Court set itself to decide, in its own words.

  1. 1.Whether the termination of the Claimant's employment was lawful and fair
  2. 2.Whether the Claimant is entitled to the remedies sought

Key legal issues

#
01

Lawfulness and fairness of termination on account of redundancy

Holding

Termination was unfair because the mandatory redundancy notice under Section 40(1)(a) & (b) was not issued to the Claimant and the Labour Officer; only a termination notice was issued, and the Labour Office notice came two days before termination.

Reasoning

The court held that the notice of intention to declare redundancy is a mandatory, separate notification distinct from the termination notice, designed to enable consultation on measures to avert or mitigate terminations. The Respondent issued only a termination notice and notified the Labour Office two days before termination, defeating the consultative purpose. Although selection criteria and payment of dues were proper, non-compliance with the notice requirements rendered the termination unfair under Section 45.

p. 5
02

Remedies for unfair termination

Holding

Three months' salary (Kshs. 750,000) awarded in compensation, taking into account length of service and the Respondent's partial compliance with Section 40(1).

Reasoning

In exercising discretion under Section 49, the court considered the Claimant's short length of service (one year under a two-year contract) and the fact that the Respondent complied with some Section 40(1) conditions, including selection criteria and payment of dues, and therefore awarded three months' rather than the twelve months' sought.

p. 6

Legal principles established

#
  • All conditions under Section 40(1) of the Employment Act must be satisfied for a redundancy to pass the lawfulness and fairness test
  • The redundancy notice under Section 40(1)(a) & (b) is separate and distinct from the termination notice under Section 40(1)(f)

Court orders

#
  1. 1.Award of three (3) months' salary (Kshs. 750,000) in compensation for unlawful and unfair termination of employment
  2. 2.Interest on the award at court rates from the date of judgment until payment in full
  3. 3.Claimant to have the costs of the case

The bench

#

One judgment of the whole court — no separate or dissenting opinions.

majority

Wrote the judgment

Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act (first-instance employment claim)

Relief refused

#

One month's salary in lieu of notice

Claim abandoned during trial

p. 6

Leave pay for one year

Claim abandoned during trial

p. 6

Service pay for one year

Claim abandoned during trial

p. 6

12 months' salary in compensation

Court awarded only 3 months' compensation given short service and partial compliance by the Respondent

p. 6

Costs

The Claimant will have the costs of the case.

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.

However, for a redundancy to pass the lawfulness and fairness test, all the conditions under Section 40(1) of the Employment Act must be satisfied. The Respondent missed the mark by failing to issue proper redundancy notices to the Claimant and the Labour Officer.
p. 5Mandatory redundancy procedure under Section 40(1)
Established jurisprudence is to the efiect that the redundancy notice under Section 40(1)(a) & (b) is separate and distinct from the termination notice provided under Section 40(1)(f) which may be paid off in cash.
p. 4Distinction between redundancy notification and termination notice
I therefore award the Claimant three (3) months' salary in compensation for unlawful and unfair termination of employment.
p. 6Compensation award
This amount will attract interest at court rates from the date of judgment until payment in full.
p. 6Interest
The Claimant will have the costs of the case.
p. 6Costs (final orders)

Issues in the judgment

#
minor

Judgment does not state the ELRC case number of the suit

Key timeline

#

Practical implications

#

Frequently asked questions

#

Cite this brief

#

Cite this brief

Caselaw, "Kanyugo v Guru Nanak Ramgarhia Sikh Hospital (Cause E535 of 2022) [2024] KEELRC 154 (KLR)", Case Analysis (2024). Memorandum of Claim dated 25th July 2022 (number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/154/eng@2024-02-08

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