Kenya Union of Domestic Hotels, Educational Institution and Hospital v Sandton Palace Hotel Limited
The bottom line
#A Kenyan court ruled a hotel's redundancy unlawful because it skipped mandatory notification steps, awarding the affected worker compensation and leave pay.
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 has locus standi to bring this suit on behalf of the grievant.
- 2.Whether the termination of the grievant's employment on account of redundancy was wrongful and unlawful.
- 3.Whether the reliefs sought are merited.
Key legal issues
#Locus standi of the union to sue for the grievant
The Claimant had legal capacity to represent the grievant because the CBA remained in force by virtue of clause 28 and section 59(2) and (3) of the Labour Relations Act
The Respondent argued the CBA had expired in November 2013 before the January 2014 redundancy. RW1 admitted clause 28 provided the CBA would remain in force until replaced or amended, and no documentary proof of termination of the CBA was produced. Section 59(2) and (3) of the Labour Relations Act keeps a collective agreement binding and incorporates its terms into individual contracts of employment.
Whether the redundancy was wrongful and unlawful
The redundancy was unfair and unlawful because the Respondent failed to comply with the mandatory procedure in section 40 of the Employment Act and clause 11 of the CBA
RW1 admitted the grievant was merely given a termination letter without prior notification to the union or labour officer as required by section 40(1)(a) of the Employment Act. Redundancy is termination for no fault of the employee, requiring fairness and dignity. Non-compliance with the mandatory procedure rendered the termination unfair and unlawful within section 45 of the Employment Act.
Reliefs merited
Reinstatement unavailable; compensation of four months' gross salary (Kshs. 88,000.00) and leave pay of Kshs. 19,066.66 awarded; notice pay, severance pay, January 2014 salary and off days declined
Reinstatement was barred by section 12(2)(vii) of the ELRC Act as the separation occurred over three years earlier. Considering over four years of service and absence of misconduct, four months' gross salary was awarded as compensation under section 49(1) of the Employment Act. Leave for 2013/2014 was allowed as the Respondent failed to prove it was taken; other heads were proved paid or lacked particulars.
Legal principles established
#- A collective agreement continues to bind the parties and its terms are incorporated into individual employment contracts until amended or replaced, per section 59(2) and (3) of the Labour Relations Act
- Redundancy is lawful only if the employer strictly complies with section 40 of the Employment Act, including one month's prior notification to the union and the labour officer
- Failure to follow the mandatory redundancy procedure renders the termination unfair and unlawful under section 45 of the Employment Act
Court orders
#- 1.Compensation of Kshs. 88,000.00 for unlawful termination
- 2.Leave pay of Kshs. 19,066.66 (26 days)
- 3.Total award of Kshs. 107,066.66 against the Respondent
- 4.Costs and interest at court rates from the date of judgment
- 5.The award of damages is subject to statutory deductions
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Article 162(2)(a) of the Constitution read with the Employment and Labour Relations Court Act (ELRC Act, section 12)
Relief refused
#Reinstatement of the grievant's employment position
Barred by section 12(2)(vii) of the ELRC Act which prohibits reinstatement after three years from separation; grievant laid off ten years earlier
One-month salary in lieu of notice
Claimant did not rebut RW1's evidence that notice pay was paid
Severance pay and salary for January 2014
RW1 produced documentary evidence proving these were paid after the redundancy
Claim for 224 off days
Lacked particulars and supporting evidence
Costs
Costs and interest at court rates from the date of judgment, awarded 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 view of the express provisions of the law and the CBA, I find that the material CBA was still applicable to the grievant's employment as at January 2014 when his services were terminated. Therefore, the Claimant was clothed with the legal capacity to represent the grievant in bringing this suit.
it is clear the Respondent never complied with the mandatory redundancy procedure set out by section 40 of the Employment Act, and Clause 11 of the CBA
termination on account of redundancy is for no fault on the part of the employee and therefore the employer should treat the employee with fairness and dignity
Consequently, I now enter judgment for him against the Respondent as follows: a) Compensation Kshs. 88,000.00 b) Leave Kshs. 19,066.66 Total Kshs. 107,066.66 c) Costs and interest at court rates from the date of judgment.
Issues in the judgment
#Conflicting employment commencement dates for the grievant
RW1 gives a third, different start date
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Union of Domestic Hotels, Educational Institution and Hospital v Sandton Palace Hotel Limited", Case Analysis (2026). Cause No. 376 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/2616/eng@2026-09-29
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.