Kenya Engineering Workers Union v Metal Crowns Ltd (Cause E719 of 2023) [2025] KEELRC 677 (KLR)
The bottom line
#A Kenyan court ruled a redundancy unfair because the employer never notified the Labour Officer, awarding the employee over Kshs 513,000.
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 termination of the Grievant's employment on account of redundancy complied with section 40 of the Employment Act, 2007
- 2.Whether the Respondent followed the redundancy procedure in the Collective Bargaining Agreement, including the Last In First Out criterion
- 3.Whether the Respondent proved the validity and fairness of the reasons for termination under sections 43 and 45 of the Employment Act
- 4.What remedies are due to the Grievant (compensation, pay in lieu of notice, severance pay, June 2021 salary, accrued leave and transport allowance)
Key legal issues
#Procedural fairness of redundancy under section 40 of the Employment Act, 2007
The redundancy was procedurally unfair: the Respondent failed to prove notification of the Labour Officer and did not demonstrate adherence to the Last In First Out criterion in clause 19.2 of the CBA.
Section 40 requires written notice of intended redundancies 30 days in advance to the employee or trade union, and notification of the local Labour Officer. The Respondent wrote to the Union on 21 May 2021, but produced no material showing the Labour Officer was notified, a requirement with public policy underpinnings. The CBA prescribed Last In First Out as the selection criterion, and the Respondent did not demonstrate that it followed it.
Burden of proving validity and fairness of termination under sections 43 and 45
The Respondent, having closed its case without leading evidence, failed to discharge the statutory burden of proving the validity and fairness of the reasons for termination.
Sections 43 and 45 of the Employment Act place the burden on the employer to prove the validity and fairness of the reasons for termination. The Respondent closed its case without leading evidence after the Court declined an adjournment, and therefore placed no material before the Court to discharge that burden. The termination was consequently found unfair and in breach of contract.
Quantum of remedies for unfair termination and breach of contract
The Court awarded the equivalent of 8 months' gross salary as compensation, pay in lieu of notice, severance pay per the CBA formula, June 2021 salary, accrued leave and transport allowance, totaling Kshs 513,729/29.
In assessing compensation the Court considered the Grievant's approximately 11 years of service and the dues the Respondent had offered, settling on 8 months' gross salary at Kshs 31,744/- per month. Pay in lieu of notice was allowed as offered and uncollected. Severance pay was computed under clause 19.4.1 of the CBA, uncontested by the Respondent. Unrebutted and acknowledged heads (June salary, leave, transport allowance) were allowed as claimed.
Legal principles established
#- An employer must notify the Labour Officer of an intended redundancy, and failure to do so renders the redundancy procedurally unfair; the requirement is grounded in public policy.
- The employer bears the burden of proving the validity and fairness of the reasons for termination under sections 43 and 45 of the Employment Act, and failure to lead evidence means that burden is not discharged.
Court orders
#- 1.Declaration that the termination of the Grievant's employment through redundancy was unfair and that the Respondent was in breach of contract
- 2.Award of compensation of Kshs 253,952/- (equivalent of 8 months' gross salary)
- 3.Award of pay in lieu of notice of Kshs 41,438/-
- 4.Award of severance pay of Kshs 197,527/-
- 5.Award of accrued leave of Kshs 14,312/-
- 6.Award of transport allowance of Kshs 6,500/-
- 7.Total award of Kshs 513,729/29 with interest at court rates from the date of judgment
- 8.Each party to bear own costs
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 (unfair termination and breach of contract claim)
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.
The Court finds and declares that the termination of the Grievant’s employment through redundancy was unfair and that the Respondent was in breach of contract.
The notification of a redundancy to a Labour Oficer is not just a matter of course. There are public policy considerations behind the requirement.
Because of the social partnership between the parties, each party to bear own costs.
The award to attract interest at court rates from the date of judgment.
Issues in the judgment
#The judgment contains apparent typographical errors rendering 'offered' and 'effective' as 'ofiered' and 'efiective', and the total award is expressed as 'Kshs 513,729/29' which appears to contain a typographical anomaly in the cents figure.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Engineering Workers Union v Metal Crowns Ltd (Cause E719 of 2023) [2025] KEELRC 677 (KLR)", Case Analysis (2025). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/677/eng@2025-03-06
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.