Lintons Place Ltd v Kamau & 2 others (Employment and Labour Relations Appeal E211 of 2024) [2025] KEELRC 2743 (KLR)
The bottom line
#A Kenyan court ruled that outsourcing security services cannot be used to disguise an unfair redundancy without following 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 trial court erred by finding that the respondents were unfairly terminated on account of redundancy
- 2.Whether the trial court erred in awarding the reliefs sought by the respondents
Key legal issues
#Whether termination of employment due to outsourcing constitutes redundancy
The court agreed with the trial court that the respondents were put to redundancy disguised as outsourcing; since their employment was lost through outsourcing without adherence to redundancy procedures, the termination was unfair.
The termination letters showed services were terminated following a decision to outsource security services. Relying on Kenya Airways and Superform, the court held outsourcing is lawful only if carried out in line with fair labour practices and not aimed at rendering employees redundant. The employer never followed section 40 redundancy procedures and did not pay terminal dues despite promising to do so in the termination letters, so the separations amounted to unfair redundancy.
Whether the awards of five months' compensation, house allowance and leave pay were justified
The awards were affirmed: compensation under section 49(1)(c) was justified given three and a half years of service; house allowance was payable as payslips showed no provision for it; leave pay was payable as the employer produced no leave records except for one respondent for 2018.
Having found unfair termination, the court affirmed entitlement to compensation under section 49(1)(c) as read with 49(4), the trial court properly considering the length of service. House allowance is an entitlement under section 31 where payslips record only basic and gross pay. As custodian of employment records under section 74, the appellant bore the consequence of failing to produce leave records, entitling respondents to leave pay under section 28.
Whether the leave pay claim was statute-barred under section 28(4) of the Employment Act
The claim was not stale; it was filed within the limitation period under section 90 of the Employment Act.
The appellant argued the leave claim was statute-barred under section 28(4). The court held that leave pay and house allowance are continuing injuries; the respondents were terminated in March 2019 and the claim was filed in May 2019, within the stipulated period under section 90 of the Employment Act, so the claim was not time-barred.
Legal principles established
#- Outsourcing of services is not illegal, but it must not be used to foster unfair labour practices or render employees redundant; where outsourcing results in job loss, the redundancy procedure under the Employment Act must be followed.
- A first appellate court must re-evaluate the evidence on record and draw its own conclusions while giving due allowance to the trial court's advantage of seeing and hearing witnesses.
Court orders
#- 1.The appeal is found unmerited and is dismissed with costs to the respondents
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- On appeal from
- Magistrates' Court (trial court)
- Jurisdiction invoked
- First appellate jurisdiction over appeals from subordinate courts in employment and labour matters (trial court judgment by a magistrate)
Relief refused
#Appeal allowing setting aside of the trial court judgment and dismissal of the respondents' suit
The court found the outsourcing of security services resulted in a redundancy disguised as outsourcing, without compliance with section 40 of the Employment Act, and the reliefs awarded were justified
Costs
Appeal dismissed with costs to the respondents
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 therefore, agrees with the trial court that the respondents were put to redundancy disguised as legal outsourcing by the appellant.
In principle therefore, outsourcing of employees is not illegal or untoward, provided it is carried out in accordance with fair labour practices, and the process adopted is not aimed at rendering an employee redundant.
Accordingly, the appeal is found unmerited and is hereby dismissed with costs to the respondents.
First, on first appeal, the court is under a duty to reconsider and re-evaluate the evidence on record and draw its own conclusions;
The court therefore agrees with the trial court that the appellant never followed the procedures set out under the Act in declaring the respondents redundant. The termination was therefore unfair.
Issues in the judgment
#The appellant's and respondents' names and the appeal case number are not stated in the judgment extract; parties and case number are recorded only descriptively.
The judgment inconsistently describes the respondents as 'Abyssinia Steel' in the respondents' submissions, apparently conflating the Abyssinia Iron & Steel case with the appellant.
The judgment states the claim was filed within 12 months under section 90 of the Employment Act, but section 90 prescribes a three-year limitation period for employment claims, not 12 months.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Lintons Place Ltd v Kamau & 2 others (Employment and Labour Relations Appeal E211 of 2024) [2025] KEELRC 2743 (KLR)", Case Analysis (2025). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2743/eng@2025-10-08
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.