Skip to content
JudgmentJob Mogaka VS Blowplast Limited16 min read

Job Mogaka VS Blowplast Limited

Employment and Labour Relations Court at Nairobi Employment and Labour Relations Court (ELRC) · · J. N. Abuodha

Summary

The Appellant appealed against a magistrate's judgment, arguing the magistrate erred in law and fact by failing to consider the Appellant's evidence on redundancy termination, misclassifying the employment as fixed-term, and dismissing claims for unfair termination, notice pay, leave, severance, and compensation. The Appellant claimed the termination was unfair due to the Respondent's failure to follow Section 40 of the Employment Act, which requires due process for redundancy. The Respondent argued the contract was fixed-term, termination complied with contractual terms, and the Appellant failed to prove unlawful termination. The court did not specify the outcome but the appeal was disposed of via written submissions.


  1. Through the Memorandum of Appeal dated 9th September 2022, the Appellant appeals against the entire Judgement of Honourable G.M Gitonga (Mr.) Principal Magistrate delivered on 29th August 2022.
  2. The Appeal was based on the grounds that:
    1. The Learned Magistrate erred in law and fact in failing to consider the Appellant’s evidence and especially the fact that the termination of the Appellant’s employment was on account of redundancy.
    2. The Learned Magistrate erred in law and fact in failing to find that the termination of the Appellant’s employment was unfair as the Respondent failed to follow due process before terminating the Appellant’s employment on account of redundancy.
    3. The Learned Magistrate erred in law and fact in holding that the Appellant employment was on fixed contract.
    4. The Learned Magistrate erred in law and fact in failing to properly analyze the evidence on record and applicable law thereby arriving at a wrong conclusion.
    5. The Learned Magistrate erred in law and fact in failing to properly analyze the Appellant’s claims.
    6. The Learned Magistrate erred in law and fact in dismissing the Appellant’s claim.
  3. The Appellant prayed that the Appeal be allowed and judgment and Decree of the Honourable Magistrate delivered on 29th August 2022 be set aside and instead judgment be entered for the Appellant in Milimani CMELRC No. E1098 of 2020 as prayed in the suit.
  4. The Appeal was disposed of by written submissions.

APPELLANT’S SUBMISSIONS

  1. The Appellant’s Advocates Kangethe Waitere & Co. Advocates filed written submissions dated 2nd December 2024 and on the issue of whether the Learned Magistrate erred in failing to consider the Appellant’s evidence and especially the fact that the termination of the Appellant’s employment was on account of redundancy, submitted that the learned magistrate erred in holding that the Appellant employment was on fixed contract and further that the trial court erred in failing to consider the law on redundancy under section 40(1) of the Employment Act.
  2. Counsel submitted that the learned Magistrate erred in treating the termination of the Appellant’s employment as a termination of a fixed term contract instead of declaration of redundancy as defined in Section 2 of the Employment Act. Counsel relied on the case of Abigael Kosgei Yator & Another v China Hanan International Co. Ltd (2018) eKLR and submitted that redundancy was a loss of employment by involuntary means and through no fault of the employee and the employer therefore forced to terminate employment of employee services. That in this case the trial court erred by holding that the termination of the Appellant was in accordance with the contract produced by the Respondent notwithstanding that this was a declaration of redundancy.
  3. On grounds 2 and 4 whether the Learned Magistrate erred in failing to find that the termination of the Appellant’s employment was unfair as the Respondent failed to follow due process before terminating the Appellant’s employment on account of redundancy and in failing to properly analyze the evidence on record and applicable law thereby arriving at a wrong conclusion, counsel submitted that the procedure the Respondent ought to have followed is as set out under the provisions of Section 40 of the Employment  Act.
  4. Counsel submitted that the provision of Section 40 are couched in mandatory terms and must be strictly followed by an employer seeking to terminate employees on account of redundancy.
  5. Counsel relied on the case of Hesbon Ngaruiya Waigi vs Equatorial Commercial Bank Limited (2013) eKLR and submitted that where the provisions of Section 40 are not followed, any termination as a result will be deemed unprocedural and unfair and that it must be a participatory, consultative and informative process.
  6. Counsel submitted that the Respondent gave the Appellant the termination letter dated 24th January 2020 on 27th January 2020 the same day his employment was terminated therefore notice was not as envisaged by provisions of Section 40(1) (a) and (b).
  7. Counsel relied on the case of Cargill Kenya Limited vs Mwaka & 3 Others (Civil Appeal 54 of 2019) (2021) KE CA 115 (KLR) and submitted that the requirement for consultation is implied as the main reason and rationale for giving notices and as required by Article 47 of the Constitution and Section 4(3) of the Fair Administrative Action Act. That the Respondent admitted in evidence that it did not consult the Claimant before reaching a decision to declare him redundant and thus infringed the Appellant’s right to be accorded a hearing.
  8. Counsel relied on among others the case of Kenya Union Domestic Hotels, Educational Institutes, Hospital and Allied Workers (KUDHEIDHA) V Nairobi Hospital (2021) eKLR and submitted that the Respondent has a burden to prove the criteria used in the selection of employees to be declared redundant based on seniority in time, skill, reliability and ability of each employee of the affected class.
  9. On the issue of whether the Learned Magistrate erred in failing to properly analyze and dismissing the Appellant’s claims, counsel submitted that the trial magistrate erred in failing to analyze the claims vis a vis the evidence and provision of Section 40  (f) and (g) in regards to payment in cash of any leave due, payment of not less than one month’s salary in lieu of notice and payment of severance pay at the rate of not less than 15 days of each completed year of service. Counsel submitted on the claims of Notice, leave, severance pay and Compensation for Unlawful Termination as prayed in the trial court that the Appellant was entitled to the same.

RESPONDENT’S SUBMISSIONS

  1. The Respondent’s Advocates Macharia-Mwangi & Njeru Advocates filed its submissions dated 24th January 2025 and on the issue of what was the nature of the contract of Appellant’s employment, counsel submitted that the contract commenced on 31/7/2019 and was to expire on 30/7/2020. That the contract was fixed term and at the beginning of every year a new contract was signed and the previous one was no longer in force.
  2. Counsel relied on the case of Samuel Chacha M,wita vs Kenya Medical Research Institute (2014) eKLR and submitted that where there is written contract between parties the court is to construe it in the terms and conditions outlined as between the parties unless there is illegality or matter subject to interpretation and that the length of notice which the employee is obliged to give and entitled to receive must be stated in the contract. That the Appellant signed the contract annually which prescribed fixed terms on the length of notice to be given in case of termination and is bound by the terms.
  3. Counsel submitted that the reasons for the Appellant’s termination were in alignment with terms of parties’ contract and that the Employment Act offered employers prerogative to terminate an employment contract where the reason is related to its operational requirements.
  4. On the issue of whether the termination was within the confines of the law, counsel submitted that in a written contract, the length of notice which the employee is obliged was in clause 11 of the contract which stated that either party had 7 days’ notice or pay in lieu of notice. That in accordance with the law the Respondent paid the Appellant two (2) weeks’ notice in lieu as that was the term of the contract and cannot be termed as unfair or unlawful.
  5. Counsel submitted that the Labour Offices and Appellant had been verbally informed by the Respondent of the notice of redundancy and intention to lay off some employees before the letter was sent on 24th January 2020.
  6. Counsel relied on the case of Kennedy Maina Mirera vs Barclays Bank of Kenya Limited [2018] eKLR and submitted that the burden of proving that an unfair termination or wrongful dismissal occurred rest on the employee while the burden of justifying the grounds for termination rest on the employer. That the employee must adduce prima facie evidence that tends to show that this employment was not terminated for a valid reason and that the employer did not follow a fair procedure in terminating his employment.
  7. Counsel submitted that the Appellant was verbally informed of the looming redundancy together with the County Labour Office due to emerging challenges in the business that needed reorganization of the business as a viable commercial undertaking. That on 24th January,2020 the same was communicated via a letter and the County Labour Officer informing them of the same. That the tabulation was given and the final dues calculated and paid to the Appellant.
  8. Counsel relied on the case of Cargill Kenya Limited v Mwaka & 3 others (supra) and submitted that no notice of termination is required to be given before redundancy under section 40(1)(f) of the Employment Act. That during cross examination the Appellant confirmed that he accepted the terminal dues and its computation on 24th January 2020 under no duress or coercion.
  9. Counsel relied on among others the case of Trinity Prime Investment Limited vs Lion of Kenya Insurance Company Ltd (2015) eKLR and submitted that execution of a discharge voucher constituted a complete contract and that the Appellant cannot go back on his word that he had accepted the amounts as final dues. That claiming more amounts shows the character of the Appellant as greedy.
  10. Counsel submitted that section 108 and 109 of the Evidence Act together with section 47(5) of the Employment Act place the burden of proving unfair termination on the Appellant. Counsel relied on the case of Protus Wanjala Mutike v Anglo African Properties t/a Jambo Mutara Lodge Laikipia [2021] eKLR and submitted that the Appellant had failed to satiate the burden of proof of unlawful termination of employment and had not adduced evidence in support of termination let alone unlawful termination on a balance of probability.
  11. On the issue of whether the Appellant is entitled to the reliefs sought, counsel submitted that the Appellant’s termination was fair and lawful hence he was not entitled to any of the reliefs sought. That in the event that this court finds otherwise counsel submitted on the claim for unfair termination by relying on the case of Kenya Airways Limited v Alex Wainaina Mbugua (2019) eKLR that the maximum compensation of 12 months must be issued based on justifiable reasons and should not be issued as a default. That the Appellant failed to demonstrate any exceptional circumstances to be awarded the full 12 months’ compensation.
  12. Counsel also submitted that the claim was also vague and unsubstantiated as it was not clear how the Appellant arrived at such a figure. That the Appellant drew a daily wage of Kshs 739.00 for each day worked paid on fortnight basis. That the monthly salary of Kshs 23,245/= could not be substantiated and paid up.
  13. On the claim for payment in lieu of notice counsel submitted that the Appellant was paid 2 weeks’ wages in lieu of notice of Kshs 8,868.00/= as per the parties’ contract which went over and above one-week notice pay required by the said contract. On the claim for accrued leave counsel submitted that from the pay slips presented by the either party it was clear that the Appellant received encashment in months where he was to take leave but did not take such leave. That the Appellant during cross examination confirmed that he would be absent some days and he got paid.
  14. Counsel further submitted that the contracts being fixed meant that leave could not accrue to the next contract and could only be claimed within the contract. That leave days could only be computed for the current contract.
  15. On the claim for severance pay counsel submitted that the Appellant was not entitled to the same as he had a fixed term contract. That redundancy could only operate within the year of employment not gradually or cumulatively. That it could operate within the contract.
  16. On the claim for certificate of service counsel submitted that the same has been always available for collection from the Respondent’s offices.

DETERMINATION

  1. The court has considered the grounds in the Memorandum of Appeal, the Record of Appeal and submissions filed by the parties and notes that the Judgment of the trial court was the dismissal of the Claimant’s claim with each party bearing their own costs; that the Claimant was procedurally terminated and that where notice was not given as per the terms of the contract of employment payment was made in lieu. The Appellant was aggrieved by the said judgment and has raised six grounds of appeal which this court will condense in to two issues namely: -
  2. Whether the trial court erred by finding that the Appellant’s termination was fair and procedural as per the employment contract and not on account of redundancy
  3. Whether the trial court erred in not awarding the Appellant the reliefs sought.

Whether the trial court erred by finding that the Appellant’s termination was fair and procedural as per the employment contract and not on account of redundancy

  1. It is the Appellant’s case that the reason for termination of his employment was due to redundancy and that the provisions of Section 40 were not followed resulting to an unfair and unprocedural termination while the Respondent averred that the Respondent’s contract was on a fixed term contracts which provided for termination upon 7 days’ notice or payment in lieu of notice. That the Appellant was paid two weeks’ notice over and above what the contract required of 7 days’ notice.
  2. The trial court on the other hand found that the Appellant’s termination was fair and lawful as per the employment contract and if any notice he was paid in lieu of notice. The termination letter dated 24th January,2020 states that the Appellant was terminated due to lack of work which clearly points out to a termination on account of redundancy. The Respondent also in its pleadings admitted that the Appellant was terminated on account of redundancy. Section 2 of the Employment Act defines redundancy as loss of employment at the initiative of the employer with the employee being not at fault.
  3. Whereas this court notes the trial court stated that the Appellant was terminated as per the contract of July 2019 which the Appellant stated that he did not sign this court agrees with the trial court that the Appellant ought to have called an expert witness to ascertain that the signature and thumb was not his. The Appellant though alleged that he only signed the 2016 contract which he did not produce stating that he was not given a copy. It is more likely than not that he signed the 2019 contract. The court does not also understand why the Respondent did not produce the previous contracts from 2016 if any existed.
  4. This court is of the contrary view with the trial court that an employer can terminate an employee at will as per the contract even where it is clear that the termination was on account of redundancy. Section 40 of the Employment Act which gives the employer a prerogative to terminate employee on account of redundancy ought to prevail.
  5. In the case of Kenya Airways Limited V Aviation & Allied Workers Union Kenya & 3 Others [2014] eKLR it was held that termination of employment on account of redundancy is justified if there is substantive justification for declaring redundancy and there is procedural fairness in the consequent retrenchment.
  6. Whereas the employer is entitled under section 40 of the Employment Act to restructure its business to stay afloat the reason for retrenchment ought to be valid.
  7. Section 40 of the Employment Act makes provision for the  procedure to be adopted by an employer who intends to terminate an employee on account of redundancy. Particularly Section 40(1) (b) of the Employment Act provides that the employer must notify the employee personally and in writing of the reasons and the extent of the redundancy at least one month before the date when the redundancy is to take effect. The Appellant received the termination letter dated 24th January,2020 on 27th January, 2020 which was to take effect immediately while the Respondent alleged that the same was served upon the County Labour Office on the same date of termination.
  8. The court finds that the letter dated 24th January, 2020 was a termination notice and not a redundancy notice required under Section 40(1)(a) of the Employment Act. Furthermore in the alleged notice, the Respondent instead of giving the Appellant the required one month’s notice, proposed to instead pay him two weeks’ salary in lieu of notice as per the contract which was contrary to the Act. 
  9. The Respondent never showed at the trial that there was any form of consultation or prior information on the redundancy to the appellant. He was terminated immediately. Unless the circumstances are such that it would be an utterly futile exercise to hold any meaningful negotiations, consultation has to be real and not cosmetic. The New Zealand Chief Judge succinctly expressed this point in the case of Cammish v. Parliamentary Service12: 

“Consultation has to be a reality, not a charade. The party to be consulted   must   be told what is proposed   and must   be given sufficiently precise information to allow a reasonable opportunity to respond. A reasonable time in which to do so must be permitted. The person doing the consulting must keep an open mind and listen to suggestions, consider them properly, and then (and only then) decide what is to be done.”

  1. From the foregoing, the Court finds that the redundancy was unjustified and carried out contrary to the provisions of section 40 of the Employment Act. The trial court therefore erred in holding that the termination was lawful and in accordance with the appellant’s contract of employment.

Whether the trial court erred in not awarding the Appellant the reliefs sought.

  1. The Respondent alleged that the Appellant was paid his final dues of Kshs 35,687.25/= through the final dues’ calculations of 24th January,2020 which included 2 weeks’ notice, one day pay and service pay. Courts have spoken on the status of executing discharge vouchers to constitute a complete contract. The Court of Appeal (Visram, Karanja, Koome JJA) in the decision in Coastal Bottlers Limited v Kimathi Mithika [2018] eKLR  held as follows: -

21. In our minds, it is clear that the parties had agreed that payment of the amount stated in the settlement agreement would absolve the appellant from any further claims under the contract of employment and even in relation to the respondent’s termination. It is instructive to note that the respondent never denied signing the said agreement or questioned the veracity of the agreement. Further, from the record, we do not discern any misrepresentation on the import of the said agreement or incapacity on the respondent’s part at the time he executed the same. It did not matter that the amount thereunder would be deemed as inadequate. As it stood, the agreement was a binding contract between the parties. “Whether or not a settlement agreement or a discharge voucher bars a party from making further claims depends on the circumstances of each case. A court faced with such an issue, in our view should address its mind firstly, on the import of such a discharge/agreement; and secondly, whether the same was voluntarily executed by the concerned parties.”

  1. As it can be seen from the above authority the final dues computation referred to by the Respondent was not a discharge voucher in strict sense and in any case it did not provide that the Appellant could not file a claim for unfair termination. The terminal dues paid were statutory dues payable to the Appellant whether he was terminated fairly or unfairly hence it was not a bar to filing a claim in court about them.
  2. The parties submitted different salaries which the Appellant was entitled to. The Respondent submitted that the Appellant was entitled to daily wage of Kshs 739/= paid fortnightly while the Appellant submitted that his salary was Kshs 23,245/=. The court must first ascertain the right salary before awarding any dues.
  3. From the documents provided by the parties it was clear that the Appellant was employed on daily wages of Kshs 739/= working six days a week which makes his salary to be around 26 days x 739 to equal to Kshs 19,214/=. The court will take this as the Appellant’s monthly salary in its calculations of final dues.
  4. The Appellant was therefore entitled before the trial court to damages for unfair termination as provided for under section 49 of the Employment Act. This court takes into account the considerations given under section 49(4) and notes that the Appellant had served the Respondent for 4 years and the nature of termination and awards the Appellant 3 months salary as compensation for unfair termination. The Appellant is also entitled to one- month notice pay and not the two weeks pay since contractual obligations cannot override the statutory obligations. This court will therefore take in to account the Kshs 8,868.00/= plus the basic pay of Kshs 739/= paid as notice pay in its calculations to remain with Kshs 9,607/= as the outstanding notice pay.
  5. The Appellant was entitled to severance pay of 15 days for the 4 years worked even if he was on yearly contracts what matters was the cumulative period he had served the Respondent. This will be 19,214 x 15/30 x 4 to equal to Kshs 38,428/=. On the prayer for leave pay which is a continuing injury and has to be filed within 12 months. The Appellant was terminated on January 2020 and filed his claim in October, 2020 hence within the time given by section 90 of the Act.
  6. Leave pay is an entitlement under section 28 of the Employment Act at 21 days. Off days cannot be said to be leave days where the Appellant would have one off day per week. Since the Respondent did not produce any leave application forms for the Appellant as the custodian of employment records this court awards the Appellant his leave. That will be 21/30 x 19214 x 4 years to equal to Kshs 53,799.2/=
  7. In the upshot the court finds that the Appellant’s Appeal is merited and the same is hereby allowed. The order of the lower Court dismissing the appellant’s claim is hereby substituted with an order allowing the claim and awarding the appellant as follows:
      1. 3 months’ salary as compensation for unfair termination…………….Kshs 57,723/=
      2. Notice pay balance……..Kshs 9,607/=
      3. Unpaid leave………Kshs 53,799.2/=
      4. Severance pay……… Kshs 38,428/=

                    TOTAL KSHS 159,557.2/=

      1. Costs of the suit
      2. Certificate of service
  1. It is so ordered.

Dated at Nairobi this ……… day of…………. 2025

Delivered virtually this……… day of ………….2025

Abuodha Nelson Jorum

Presiding Judge-Appeals Division

    Job Mogaka VS Blowplast Limited Job Mogaka VS Blowplast Limited