Prafulbhai v ISS Global Forwarding [Kenya] Limited (Cause E6523 of 2020) [2024] KEELRC 2125 (KLR)
The bottom line
#A Kenyan court awarded an ex-employee nearly Kshs 5 million because his employer's genuine Covid-19 redundancy skipped mandatory legal procedures.
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 Claimant left employment on account of poor performance or redundancy
- 2.Whether the procedure adopted in terminating the Claimant's employment was fair
- 3.Whether the Claimant merits the prayers sought
Key legal issues
#Whether termination was on account of poor performance or redundancy
The Claimant successfully completed probation; the genuine reason was redundancy arising from business downturn caused by Covid-19, which the Respondent itself did not dispute.
The Respondent did not advise the Claimant of any probation outcome and the termination letter expressly stated it was not a reflection of his performance. Both parties' witnesses acknowledged financial difficulties and redundancy. Since the Respondent retained the Claimant for 15 days after probation expired, performance could not justify termination; a genuine redundancy situation was established on the common evidence without production of financial records.
Whether the redundancy procedure was fair and lawful
Although the redundancy was genuine, the procedure was unfair and unlawful for non-compliance with Section 40 of the Employment Act.
There was no evidence of notice to the Claimant or the Labour Office, no minutes of consultation, no evidence that alternatives to redundancy were discussed for an expatriate recruited from India, and no evidence of payment of redundancy benefits under Section 40. The Respondent vacillated between redundancy and poor performance, with a witness stating termination would occur regardless of redundancy, indicating an intention to terminate at will.
Whether the Covid-19 salary deduction could be retained permanently
The deduction was expressly temporary; the Respondent acted in breach of good faith and fair dealing by retaining the withheld salary and the arrears were recoverable.
The Respondent's own communications of April and June 2020 and Magesh's witness statement described the pay cut as temporary. September 2020 salary was paid in full, confirming restoration. It was not fair dealing between capital and labour to make the temporary deduction effectively permanent and withhold the arrears at exit, especially as the Claimant left unemployed after being lured from India.
What remedies the Claimant merits
Two months' notice pay and three months' salary compensation awarded, taking into account the short service, the lure of a permanent and pensionable contract, the Claimant's age and losses on relocation.
The Claimant worked 6 months and 15 days but resigned a senior job in India on promises of permanent employment. Though neither party caused Covid-19, the Respondent's unfair procedure and failure to mitigate warranted compensation beyond mere facilitation of travel, assessed at three months' salary given the short tenure.
Legal principles established
#- Where an employer retains an employee after expiry of probation without confirmation or notice of non-confirmation, it is presumed probation was successfully completed and the employee becomes a regular employee.
- An employer relying on redundancy must comply strictly with the procedural demands of Section 40 of the Employment Act, including notices, consultation and payment of redundancy benefits.
- Termination at will is no longer a permissible mode of termination under the Employment Act.
Court orders
#- 1.Termination declared unfair and unlawful
- 2.Respondent to pay notice at Kshs 1,540,000
- 3.Respondent to pay the equivalent of 3 months' salary in compensation for unfair termination at Kshs 2,310,000
- 4.Respondent to pay salary arrears of 4 months at Kshs 1,095,589 (total award Kshs 4,945,589)
- 5.Costs to the Claimant
- 6.Interest allowed at court rate from the date of Judgment till payment is satisfied in full
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 (Sections 40, 42, 43 and 45 invoked) over a claim of unfair and unlawful termination
Relief refused
#Damages for unlawful termination (separate from compensation)
Redundant in light of the prayer for compensation for unfair termination; statute provides adequate remedy
Loss of rent security deposit at Kshs 90,000
Respondent already paid Kshs 90,000 ex gratia which sufficiently redressed that loss
Loss of sale of household items at Kshs 222,000
No receipts exhibited to support the claim
Relief specific to unremitted PAYE tax
No prayer specific to unremitted tax; Claimant to pursue the matter with tax authorities
Costs
Costs to the Claimant
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 Sum, it is Ordered: a. Termination was unfair and unlawful b. The Respondent shall pay to the Claimant, notice at Kshs 1,540,000; equivalent of 3 months' salary in compensation for unfair termination, at Kshs 2,310,000; and, salary arrears of 4 months at Kshs 1,095,589 – total Kshs 4,945,589.
It is to be presumed that probation was therefore successfully completed, and the Respondent considered the Claimant a regular Employee, for the 15 days he worked after 31st August 2020.
the Respondent was going to adopt the procedure discarded by the Employment Act, 2007 decades ago, known as termination-at-will, in getting rid of the Claimant.
While there was a genuine redundancy situation, the Respondent did not adhere to a fair and lawful procedure, in terminating the Claimant's contract on redundancy.
It was not fair dealing between capital and labour, for the Respondent to ignore that it had not paid the Claimant's full salary from April to August 2020.
The Court does not think that the Respondent acted reasonably and was justifed, in retaining the rest of Claimant's salary, from April to August 2020.
Issues in the judgment
#The judgment inconsistently dates the end of probation, stating 31st August 2020 in most passages but 1st September 2020 in the Respondent's pleading summary.
The judgment contains a typographical error referring to the year of post-probation work as 2024 instead of 2020.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Prafulbhai v ISS Global Forwarding [Kenya] Limited (Cause E6523 of 2020) [2024] KEELRC 2125 (KLR)", Case Analysis (2024). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2125/eng@2024-08-09
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.