Keya v Crescent Tech Ltd (Appeal E154 of 2025) [2026] KEELRC 2435 (KLR) (31 August 2026) (Judgment)

**REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT AT NAIROBI** **APPEAL NO. E154 OF 2025** **BERITA MUHONJA KEYA APPELLANT** *VERSUS* **CRESCENT TECH LIMITED RESPONDENT** (**Being an appeal from the judgment of Hon. Aziza Ajwang’ delivered on 22 April 2025 in Nairobi MCELRC E1241 of 2022)** **JUDGMENT** The appeal arises from the judgment delivered on 22 April 2025 in Nairobi MCELRC E1241 of 2022. The appellant has raised 7 grounds of appeal: 1. The learned magistrate erred in law and fact by finding that the appellant resigned from employment. 2. The learned magistrate erred in law and fact by finding that the respondent’s reason for terminating the appellant from employment was valid. 3. The learned magistrate erred in law and fact by failing to consider the totality of the unfair labour practices the appellant was subjected to by the respondent 4. The learned magistrate erred in law and fact by failing to consider that the process of terminating the appellant from employment was unprocedural, unfair and unlawful 5. The learned trial magistrate erred in law and fact by failing to consider the evidence before her and considering extraneous evidence not before her 6. The learned magistrate erred by not considering the appellant’s submissions. The background of the appeal is the claim that the appellant was employed by the respondent on 5 August 2016 as a service desk coordinator at a monthly wage of 50,389. His case was that, by emails dated 24 August 2020, 25 September 2020, 2 October 2020, and 3 October 2020, the respondent paid redundancy dues without stating the employment status. This followed a previous 50% salary cut without the appellant’s involvement, and a demand that the appellant accept the pay cut or resign. The claim was that the pay cut was discriminatory as other employees were not affected, was unfair and unjust, thus a clear violation of the appellant’s right to fair labour practices. The appellant prayed for the following: 1. Maximum compensation for unfair termination- Kshs. 604,668. 2. Unpaid housing allowance Kshs. 362,800. 3. Damages for discrimination and infringement of the appellant’s rights as provided in Article 41(1) and (2b) of the Constitution 2010 and section 5 of the Employment Act 2007 4. Certificate of service 5. Costs of the suits. In reply, the respondent admitted that the claimant’s employment was terminated on the grounds of redundancy. In the meeting held on 14 August 2020, an explanation was provided regarding the difficult economic situation resulting from the COVID-19 pandemic and the steps taken to address it. The options availed to the appellant were tabled with all employees, and the employees returned to work of their own volition. The pay cut for May 2020 was presented to all employees as the company was experiencing a dire economic period due to the COVID-19 pandemic. The respondent prayed that the claim be dismissed with costs. The learned magistrate assessed the evidence and held that the appellant was not compelled to resign, but that the situation was created by an unexpected and external force, namely, the COVID pandemic. The resignation did not, therefore, amount to unfair and unlawful termination, as the appellant disagreed with the measures the respondent took in response to the COVID-19 pandemic. The court dismissed the prayers save for the provision of a certificate of service. On the appeal, the appellant submitted that whilst the respondent cited the uncertainty in the commercial sector due to COVID-19 as its reason for intending to declare the appellant’s position redundant, the respondent, however, failed to prove that indeed it was undergoing decline due to those factors. The reason for the termination was therefore not valid. The respondent's failure to issue the 30 days’ notice to the labour officer as envisioned by section 40 (a) and (b) of the Employment Act (the Act) was a contravention of the law and rendered the process of declaring the appellant’s position redundant flawed and unfair. The said notice was also not served on the appellant. In **Thomas De La Rue (K) Ltd v David Opondo Omutelema [2013] KECA 492 (KLR),** the court held that section 40 (a) and (b) of the Act provide for two different kinds of notifications depending on whether an employee is a member of a trade union or not. Where the employee is a member of a union, the notification is to be made to the union and the local labour officer at least one month before the effective date of redundancy. Where the employee is not a member of a trade union, the notification must be in writing and to the local labour officer and the employee. In **Lavington Security Guards vs Omambia [2024] KEELRC 566 (KLR),** the court held that a shorter notice than the 30 days’ notice prescribed violates the mandatory requirements of section 40 of the Act. In **Cargill Kenya Ltd v Mwaka & 3 others (Civil Appeal 54 of 2019) [2021] KECA 115 (KLR),** the court held that the notification must address the reasons for, and the extent of, the intended redundancy. The appellant contends that the respondent’s notice dated 27 July 2020 did not meet the mandatory provisions of section 40(1)(a) and (b) of the Act, and termination of employment was unfair, unlawful and procedurally flawed. The respondent violated section 40(1)(c) of the Act which makes it mandatory that the employer in the selection of employees to be declared redundant have due regard to seniority in time, skill, ability and reliability of each employee of the particular class of employees affected by redundancy and cites the case of *Cargill case*, cited above that the employer should include the factors set out in section 40(1)(c) of the Act in the criteria for evaluating and selecting the employees to be declared redundant and the employer must prove that the criteria was objectively, uniformly and fairly applied. The appellant submitted that the termination of her employment was unfair and unlawful, and that she is entitled to 12 months' compensation. She worked for the Respondent for 4 years. Payment of house allowance since clause 6 of the Employment contract only provided for the appellant’s salary, while section 31 of the Act provided for a house allowance. In **Jubilee Hardware Ltd v Rogaciana Rading Ogwang [2021] eKLR**, the court held that the contract of employment should outline an entitlement to housing or a house allowance. Where it did not, an interpretation that favours the enjoyment of the right is to be adopted. The appellant also asked to be issued with the certificate of service under section 51 of the Act. The respondent did not file written submissions. **Determination** The court is alive to the fact that this is the first appeal; therefore, the court is called upon to re-evaluate all the material on record and arrive at its own conclusions on the disputed facts. However, the court must keep in mind that it did not have the opportunity to assess the demeanour of the witnesses as the trial magistrate did. Thus, take such a fact into account as held in **Top Tank Company Limited v Amos Ondiek Wandaye [2018] eKLR*.*** The appellant’s case was that on 27 April 2020 the respondent directed her to take a pay cut without her consent and to proceed on unpaid leave from 1 June 2020. In May 2020, 50% of her salary was withheld without consent. On 1 July 2020, other employees were recalled to work, but she was left out, which was discriminatory. On 14 August 2020, the appellant was directed to take a pay cut or resign from her employment, which she declined. Payment of redundancy dues was made without considering the unfairness; hence, compensation and damages for discriminatory treatment, house allowances for 4 years, and a certificate of service were claimed. The respondent admitted that the appellant was employed on a consolidated salary of Ksh. 50,389 per month. Due to redundancy, a meeting was held with the appellant on 14 August 2020, before the termination of employment, and terminal dues were paid. Under the employment contract, the respondent reserved the right to vary the salary upon written notice to the appellant; accordingly, a letter dated 27 April 2022 was sent seeking such approval. In June 2020, the full salary was paid at Ksh. 50,389 and was acknowledged. In August 2020, the respondent called the appellant back to work, but she declined. On 14 August 2020, a meeting was held, and the appellant attended. The respondent communicated that it was facing a difficult economic situation due to the COVID pandemic, and, to salvage the business, a redundancy was declared, affecting the appellant’s position. There were consultations with the labour officer, and the claims made should be dismissed. In the letter dated 27 April 2020, the respondent notified all its employees of its intention to declare redundancy. Notice was issued to the labour officer. The issue was that, due to uncertainty in the commercial sector and the COVID-19 pandemic, the business had been impacted, and the respondent had therefore embarked on restructuring. The respondent offered to pay the affected employees in August and October 2020. The appellant admitted receipt of emails dated 24 August 2020, 25 September 2020, 2 October 2020, and 3 October 2020, and that the respondent paid redundancy dues without stating the employment status. However, payment of redundancy dues related to the restructuring was made through a notice issued on 27 April 2020. Under section 40 of the Act, the employer may terminate employment for operational reasons. Redundancy is defined as such an operational reason. In [**Cargill Kenya Limited v Mwaka & 3 others [2021] KECA 115 (KLR)**](https://new.kenyalaw.org/akn/ke/judgment/keca/2021/115/eng%402021-10-22)**,** the court held that upon the general and specific notices to the employee, the employer is allowed to pay in lieu of notice or allow the employee to serve the notice period. In this case, the appellant was issued with a notice and invited to a meeting on 14 August 2020 to explain the extent and purpose of the redundancy. Indeed, in **Africa Nazarene University v David Mutevu & 103 others [2017] eKLR (Civil Appeal 236 of 2015)** the court emphasised that the notice to the affected employee can be oral or in writing. In this case, it was in both forms. Written and oral. The emails sent to the appellant confirm this fact of notice. Due process in redundancy was followed. The appellant is seeking damages for alleged discriminatory treatment, on the grounds that other employees were recalled to work while she was left out. She does not give the particulars of such matter. The other employees recalled are not indicated. Her personal circumstances, as the only employee singled out for redundancy, are not addressed. In **Barclays Bank of Kenya Ltd & another v Gladys Muthoni & 20 others [2018] eKLR (Civil Appeal 296 & 301 of 2016 (Consolidated)** the court emphasised that although discrimination is prohibited under the Constitution, it must be proved. The one claiming such a matter must call evidence. The appellant filed the notice dated 27 April 2020 and the subsequent email communication about the redundancy. She cannot turn around and claim she was discriminated against. In this case, save to make the assertions, there was no proof. On the compensation claims, the redundancy was justified and procedural; under sections 45 and 49 of the Act, compensation is not due. The findings by the learned magistrate are correct. Regarding the house allowance claim, under clause 6.1 of the employment contract dated 5 August 2016, the salary paid was consolidated. This is allowed under section 31 of the Act. Equally, the appellant was employed as a Service Desk Coordinator on a salary of Ksh. 50,389 per month. Such is not a basic wage upon which the Wage Orders would apply a house allowance. The learned magistrate well assessed the facts and correctly applied the law. **Accordingly, the appeal is without merit and is hereby dismissed. Each party to bear its costs.** **Delivered in open court this 31st day of August 2026** **M. MBARŨ** **JUDGE** **In the presence of:** **Court Assistant: Kemboi** **……………………………………………… and …………………………………..………**