Automated Summary
Key Facts
Radar Limited terminated Paul Matenge Mwadime's employment in April 2020 citing redundancy after losing a third-party contract. The company failed to provide required notices to the employee and union under Section 40 of the Employment Act. The trial court found unfair termination, awarding 5 months' compensation, accrued leave pay, overtime, and house allowance. The appellate court revised the award to include 5 months' compensation, notice pay, service pay, and split costs between parties, confirming procedural violations in the termination process.
Issues
- The court's error in law and fact by finding the respondent entitled to reliefs sought without discharging the burden of proof under Section 47(5) of the Employment Act.
- The magistrate's failure to consider the appellant's arguments and submissions during the decision-making process, affecting procedural fairness.
- Whether the loss of a third-party contract in November 2020 justified the respondent's termination in April 2020, violating Section 40's procedural requirements.
- Dispute over the award of five months' compensation for unfair termination, despite the respondent having worked only a short period, under Section 40 of the Employment Act.
- The trial court's award of costs without providing reasons under Section 12(4) of the Employment and Labour Relations Court Act.
- Dispute over the award of overtime pay without the respondent establishing proof of claimed hours under Section 10 of the Employment Act and the relevant Wage Orders.
- Challenge to the award of leave pay for 3 years of service, conflicting with Section 28(4) which limits accrued leave claims to 18 months.
- Whether the 15% house allowance was properly included in the respondent's wage under the Regulation of Wages (General) (Amendment) Orders and if this justifies the award.
Holdings
The court reviewed the original judgment and adjusted the compensation to 5 months' gross wage (Kshs 89,100), included notice pay (Kshs 17,820), service pay (Kshs 53,460), and ruled that each party bears its own costs. The determination emphasized procedural fairness failures by the appellant, including lack of proper redundancy notices and work records. The adjusted awards were applied to all consolidated appeals (E089 to E100 of 2024).
Remedies
- Costs of the lower court proceedings ordered to be borne by each party.
- Notice pay awarded at Kshs 17,820.
- Compensation awarded at 5 months' gross wage amounting to Kshs 89,100.
- Service pay awarded at Kshs 53,460.
Monetary Damages
160380.00
Legal Principles
- The court emphasized that the respondent must discharge the burden of proof under Section 47(5) of the Employment Act to establish unfair termination. The appellant failed to meet its burden by not submitting work records or evidence of proper redundancy procedures.
- Principles of procedural fairness under Natural Justice were invoked, requiring proper notice, consultation, and adherence to Section 40 of the Employment Act. The court found the appellant violated these principles by terminating employment without due process.
- The standard of proof required for redundancy claims was addressed, with the court noting that the respondent's evidence demonstrated non-compliance with Section 40's procedural requirements. The appellant's failure to meet the standard of proof led to the determination of unfair termination.
Precedent Name
- Hesbon Ngaruiya Waigi v Equatorial Commercial Bank Limited
- Kenya Union of Commercial Food and Allied Workers v Nerix Pharma Limited
- Ngunda v Ready Consultancy Limited
- Yaa v SGA Security Solutions Limited
- BIFU v Maisha Bora Sacco Society Ltd
- Cargill Kenya Limited v Mwaka & 3 others
- Shanga Kitsao Mumbasa v Mabati Rolling Mills
- Jared Mangera & 11 others v Professional Clean Care Limited
Cited Statute
- Employment Act, Section 45
- Employment Act, Section 40
- Employment Act, Section 28(4)
- Employment Act, Section 43
- Employment and Labour Relations Court Act, Section 12(4)
- Evidence Act, Section 107
Judge Name
M. Mbaru
Passage Text
- 23. At the heart of the Appeal is the award of five months' compensation, leave pay, a house allowance, overtime, and costs.
- While the requirement of consultation was not expressly provided in section 40 of the Employment Act, that requirement was implied as the main reason and rationale for giving the notices in section 40(1)(a) and (b) to the unions and employees of an impending redundancy.
- 46. It is insufficient to deny that there was no overtime or that this was paid with the monthly wage. Work records on the respondent's time sheets would have served a primary purpose in proving whether there was overtime work or not.