Wanja v North Coast Medical Hospital (Employment and Labour Relations Cause E003 of 2023) [2025] KEELRC 1241 (KLR)
The bottom line
#Kenya's Employment Court ruled the redundancy was a sham and awarded a Marketing Manager six months' salary, severance, notice pay and costs.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether there was a genuine redundancy situation.
- 2.Was the termination fair if the answer to [a] above is affirmative?
- 3.Is the Claimant entitled to the reliefs sought?
Key legal issues
#Whether there was a genuine redundancy situation
There was no authentic redundancy; the asserted redundancy was a mere pretence disguising an unfair termination on grounds of alleged poor performance
The court held that an employer must provide reasonable details of a restructuring, especially when disputed. The Respondent's pleadings and evidence were overly general and ambiguous, with no document showing the Marketing Department was restructured, no reference to other departmental staff, and no evidence of consultations. The Claimant was accused of inadequate performance yet terminated under the pretext of redundancy, leading the court to find the redundancy a pretence.
Whether the termination was procedurally fair under section 40 of the Employment Act
The termination was procedurally unfair: no redundancy notice was issued or served, and no consultation preceded the termination
Section 40 prescribes mandatory steps including notification of the employee and the Labour Officer at least one month before termination, and payment of notice and severance. The court found the letter of 31 January 2023 resembled a termination letter rather than a redundancy notice, gave barely 24 hours' notice, and that consultation, which the law implies, never took place. The minutes of 15 December 2022 concerned performance evaluation, not redundancy.
Whether the Claimant was entitled to compensation and the quantum payable
The Claimant was awarded six months' gross salary as compensation under section 49(1)(c), plus severance, notice pay and leave pay admitted by the Respondent
Compensation under section 49(1)(c) is discretionary, with twelve months as the maximum. Considering that the grounds for termination were obscured, that the Claimant did not contribute to the termination, the length of service, and the Respondent's failure to meet statutory requirements of substantive and procedural fairness, the court awarded six months' gross salary. Judgment on admission was entered for severance pay, notice pay and untaken leave.
Legal principles established
#- Redundancy is a no-fault termination and the Employment Act places particular obligations on employers to ensure affected employees are treated fairly
- An employer must do more than merely assert restructuring; it must lead evidence of the conception, rationale, deliberations, decision and implementation of the restructuring
- Consultation with the employee prior to declaring redundancy is implied by section 40(1)(a) and (b) of the Employment Act and is also required by Article 47 of the Constitution
- The employer bears the onus of demonstrating that a legitimate redundancy situation existed
Court orders
#- 1.A declaration that the termination of her employment was procedurally and substantively unfair.
- 2.Compensation for unfair termination pursuant to the provisions of section 49[1][c] of the Employment Act, six [6] months' gross salary, KShs. 616,878.
- 3.Severance pay, KShs. 177,945.58.
- 4.One month's salary in lieu of notice, KShs. 102,813.
- 5.Compensation for earned but unutilised leave days……. KShs. 15,355.85
- 6.A certificate of service is to be issued to the Claimant within 30 days of this judgment.
- 7.Costs of the suit
- 8.Interest on the awarded sums above, at court rates from the date of this judgment till full payment.
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 (first-instance employment cause)
Relief refused
#Twelve months' gross salary compensation of KShs. 1,657,411.27 as sought
The court awarded six months' gross salary instead of the maximum twelve months, considering the circumstances, length of service and the Respondent's failure to adhere to statutory requirements
Welfare Scheme saving of KShs. 32,175
Not included in the judgment entered; judgment was entered on admitted figures and six months' compensation
Costs
Costs of the suit awarded to the Claimant, with interest on the awarded sums at court rates from the date of the judgment until full payment
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 my perspective, it is insufficient for an employer merely to articulate that the organisation or entity underwent restructuring, resulting in the redundancy of certain positions. Employers are expected to provide reasonable details
The process of restructuring and declaring redundancy is not a mere event; rather, it constitutes a series of actions.
In light of the aforementioned premises, I am convinced by the Claimant that the redundancy asserted by the Respondent was a mere pretence. There existed no authentic redundancy situation.
A declaration that the termination of her employment was procedurally and substantively unfair.
Compensation for unfair termination pursuant to the provisions of section 49[1][c] of the Employment Act, six [6] months' gross salary, KShs. 616,878.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Wanja v North Coast Medical Hospital (Employment and Labour Relations Cause E003 of 2023) [2025] KEELRC 1241 (KLR)", Case Analysis (2025). ELRC Cause (Memorandum of Claim filed 16 June 2023). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1241/eng@2025-04-30
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.