Mwonjaru v Meridian Health Group (Employment and Labour Relations Appeal E096 of 2025) [2026] KEELRC 1692 (KLR) (19 June 2026) (Judgment)

Mwonjaru v Meridian Health Group (Employment and Labour Relations Appeal E096 of 2025) [2026] KEELRC 1692 (KLR) (19 June 2026) (Judgment) Neutral citation: [2026] KEELRC 1692 (KLR) Republic of Kenya In the Employment and Labour Relations Court at Nairobi Employment and Labour Relations Appeal E096 of 2025 NJ Abuodha, J June 19, 2026 Between Naomi Mwonjaru Appellant and Meridian Health Group Respondent (Being an Appeal against the Judgment of P.A. Olengo (SPM), in Milimani Chief Magistrate Employment Cause No. MCELRC 841 of 2024; Naomi Mwonjaru vs Meridian Health Group delivered on 25th February, 2025 at Nairobi) Judgment 1.Through the Memorandum of Appeal dated 3rd April, 2025, the Appellant appeals against the judgment and decree of the Hon. P.A. Olengo (SPM) delivered on 25th February 2025. The Appeal was based on among other grounds that the trial court erred in finding that the Respondent followed the right procedure in rendering the Claimant redundant hence the termination was not unlawful and that she was paid her terminal dues. That the trial court failed to consider that the Respondent paid the Appellant Kshs 103,283.35/= leaving a balance of Kshs 44,724.65/= which payment was done just before the main hearing. 2.The Appellant prayed that the Appeal be allowed with costs and the judgment delivered in Nairobi CMELRC NO. E841 of 2024 on 25th February, 2025 be set aside. 3.The Appeal was disposed of by written submissions. Appellant’s Submissions 4.The Appellant’s Advocates Muhatia Pala & Associates Advocates filed written submissions dated 7th October, 2025 and on the issue of whether the trial court erred in finding that the Respondent followed the right procedure in rendering the Appellant redundant, counsel submitted that the Respondent failed to comply with Section 40 of the Employment Act on redundancy in its termination of the Appellant’s employment on account of redundancy vide a termination letter dated 14th August 2023. In particular, it was submitted that the Appellant’s testimony was that the Respondent only issued the Appellant with a letter dated 14th August, 2023. While the Respondent's witness testified that they issued her with an earlier letter dated 8th May 2023 titled "notice of intended redundancy", it was submitted that the Appellant denied receiving the same, and during cross-examination, the Appellant testified that she did not sign the said letter. Further, counsel submitted that prior to the Appellant’s redundancy, she was not invited to participate in any discussion involving the redundancy; and neither was she paid, at the time of termination of her employment, one month's pay in lieu of notice, severance pay and her salary for the days worked. 5.It was counsel’s submissions that the process of terminating the Appellant’s employment on account of redundancy lacked substantive and procedural fairness, for the reasons that there was no valid ground for termination and/or proof of the reason conveyed to the Appellant; the Respondent did not demonstrate how they came to the decision to terminate the Appellant; and no notice of intended redundancy was issued to the Appellant. 6.Having proved that the Appellant’s termination from employment on account of redundancy was devoid of substantive and procedural fairness, counsel submitted that the termination was unlawful. In addition to the failures of the Respondent highlighted by counsel as stated hereinabove, they also submitted that the Appellant was not subjected to any hearing and or discussion regarding redundancy prior to her termination. In this regard Counsel relied on the case of Daniel Mburu Muriu v Hygrotech East Africa Ltd to submit that declaration of redundancy is a process and not an event. Further, even when an employee is to be terminated on redundancy such an employee should still be afforded a hearing where their views on the redundancy can be ventilated. 7.On the issue of payment of terminal dues, it was submitted by counsel for the Appellant that at the time of termination of the Appellant’s employment, the Respondent did not pay her terminal dues. The Respondent stated vide their letter dated 14th August, 2023 that they would pay her final dues of Kshs.89,389.80/= in monthly installments of Kshs.29,796.33/- beginning on 1st September 2023 but they failed to do so. In any case the Appellant's claim was for Kshs.148,008/- comprising of notice pay, 13 days worked in August 2023 and severance pay. 8.While Counsel for the Appellant admits that the Appellant received Kshs. 103,283.35 on 23rd September 2024, they indicate that there was a balance of Kshs.44,724.65/=. They further point out that the payment was made shortly before the main hearing of the trial court case. During the hearing, the Appellant's advocate informed the court of the said development and indicated that the hearing would be on the issue of the balance. 9.Counsel for the Appellant submitted that the trial court held that the Appellant was paid her terminal dues as per provisions of section 40 of the Employment Act. That the payment of Kshs.103,283.35/- to the Appellant was an express admission by the Respondent that they owed the Appellant terminal dues. They therefore submitted that the trial magistrate erred by holding that the Appellant was paid her terminal dues as required by Section 40 of the Employment Act, as a balance of the terminal benefits remained. 10.Counsel concluded on submitting on the role of the first appellate court while relying on the case of Mursal & Another V Manase (Suing as the Legal administrator of Dalphine Kanini Manesa) (Civil Appeal E20 of 2021) (2022) KEHC 282 (KLR) (6 April 2022) (Judgment) while urging the court to set aside the trial court’s judgment. Respondent’s Submissions 11.The Respondent’s Advocates Sinana & Company Advocates filed written submissions dated 3rd November, 2025 and on the issue of whether the termination was unfair, counsel submitted that the Appellant was terminated on account of redundancy. That the Appellant was issued with a notice of intended redundancy dated 8th May, 2023 and acknowledged receipt of the same. That she was further invited for a meeting to discuss the separation and advised that due to the financial constraints experienced by the Respondent her terminal dues would be paid in installments. 12.Counsel submitted that the termination letter dated 14th August, 2023 gave a tabulation of the terminal dues payable to the Appellant and the Appellant acknowledged payment of her terminal dues being Kshs 103,283.35 less the statutory payments. The Kshs. 44, 724.65 claimed by the Appellant were statutory dues paid to the relevant bodies. Reliance was placed on section 49(2) of the Act which allowed statutory deductions on terminal dues. 13.Counsel submitted that the redundancy adhered to Section 40 (1) of the Employment Act hence lawful and in accordance with the law. He placed further reliance on ILO Convention 158 and Recommendation 166 both ratified by Kenya that recognize the right of employers to terminate employment for reasons of economic, technological, structural or similar nature and require employers to engage trade unions and the competent authorities where the employer is contemplating declaring employee redundant. The Employment Act also recognizes redundancy as a legitimate mode of termination of employment save to provide for conditions to be complied with by the employer. 14.Counsel cited among others the Court of Appeal case of Kenya Airways Limited v Aviation and Allied Workers Union Kenya & 3 others [2014] eKLR to submit that redundancy is a legitimate ground for terminating a contract of employment provided there is a valid and fair reason based on operation requirements of the employer and termination is in accordance with a fair procedure. 15.Counsel submitted that redundancy being a legitimate ground for termination of employment the Respondent was within their right to terminate the Appellant’s employment due to the financial constrains they were experiencing making it difficult for them to sustain the Appellant service. 16.Counsel submitted that the termination of the Appellant’s employment was not unfair, considering that the Notice of Intended Redundancy was shared with the Labour Office and that it was not the appellant alone who was declared redundant but other employees were also affected. The proposal to pay the terminal dues in installments was also a clear indication that the business was struggling financially. Determination 17.The court has considered the grounds of appeal, the record of appeal, submissions filed by the both parties herein and notes that the Judgment of the trial court dismissed the Appellant’s claim with costs on the premise that her redundancy was a legitimate ground for termination of employment as it was based on operational requirements of an employer and her terminal dues were paid. 18.The Appellant aggrieved by the above judgment fronted five grounds of appeal which this court will reduce into two main issues namely: -i.Whether the trial court erred by finding that the termination of the Appellant was lawful and the Respondent followed the right procedure in declaring the Appellant redundant.ii.Whether the trial court erred by finding that the Appellant was paid her terminal dues. Whether the trial court erred by finding that the termination of the Appellant was lawful and the Respondent followed the right procedure in declaring the Appellant redundant. 19.It was not in dispute that the Appellant was an employee of the Respondent who was employed in January 2016 as a patient attendant as per certificate of service and was terminated on account of redundancy as per letter of termination dated 14th August, 2023. The court notes that redundancy is one of legitimate ways of ending employment relationship so long as it is done as per the law. 20.Redundancy has been defined under section 2 of the Employment Act as;means the loss of employment, occupation, job or career by involuntary means through no fault of an employee, involving termination of employment at the initiative of the employer, where the services of an employee are superfluous and the practices commonly known as abolition of office, job or occupation and loss of employment. 21.The courts have stated severally that even in cases of redundancy the reason ought to be valid as provided for under section 43 of the Employment Act. In Kenya Airways Limited VS. Aviation and Allied Workers Union of Kenya and 3 Others (2014) eKLR, the Court of Appeal pronounced itself as follows:“Thus, redundancy is a legitimate ground for terminating a contract of employment provided there is a valid and fair reason based on operational requirements of the employer and the termination is in accordance with a fair procedure. As Section 43(2) provides, the test of what is fair reason is subjective. The phrase “based on operational requirements of the employer” must be construed in the context of the statutory definition of redundancy.What the phrase means, in my view, is that while there be underlying causes leading to a time redundancy situation such as reorganization, the employer must nevertheless show that the termination is attributable to redundancy – that is that the services of the employee has been rendered superfluous or that redundancy has resulted in abolition of office, job or loss of employment.” 22.From the above precedent and the evidence presented before the trial court, it was clear the reason given by the Respondent in the termination letter was re-organization of the Company’s operations where the Appellant’s role would be affected. Whereas the Respondent alleged that it was facing financial constraints the same was not the reason given in the termination letter or the notices herein. The Respondent did not present during the trial, any financial statements or records to prove that it was undergoing financial difficulties. 23.This notwithstanding the Respondent had a right to declare the Appellant redundant due to the operational requirements of its organization in order to remain afloat in the market however the Employment Act gives the procedure and guidelines to be followed before the said termination on account of redundancy. 24.The guiding law in declaring redundancy is section 40 of the Employment Act which provides as follows: _(1)An employer shall not terminate a contract of service on account of redundancy unless the employer complies with the following conditions—SU(a)where the employee is a member of a trade union, the employer notifies the union to which the employee is a member and the labour officer in charge of the area where the employee is employed of the reasons for, and the extent of, the intended redundancy not less than a month prior to the date of the intended date of termination on account of redundancy;(b)where an employee is not a member of a trade union, the employer notifies the employee personally in writing and the labour officer;(c)the employer has, in the selection of employees to be declared redundant had due regard to seniority in time and to the skill, ability and reliability of each employee of the particular class of employees affected by the redundancy;(d)where there is in existence a collective agreement between an employer and a trade union setting out terminal benefits payable upon redundancy; the employer has not placed the employee at a disadvantage for being or not being a member of the trade union;(e)the employer has where leave is due to an employee who is declared redundant, paid off the leave in cash;(f)the employer has paid an employee declared redundant not less than one month’s notice or one month’s wages in lieu of notice; and(g)the employer has paid to an employee declared redundant severance pay at the rate of not less than fifteen days pay for each completed year of service. 25.Whereas the Respondent issued the redundancy notice to the labour office on 5th May, 2023 and the Appellant on 8th May, 2023 and alleged that there were meetings held to discuss the issue, the Appellant denied receiving the said notice or attending the said consultative meetings. The Appellant denied signing the alleged notice dated 8th May, 2023 and a closer scrutiny of the same shows it did not indicate if she was been declared redundant but a confirmation of the same was to be sent later. No confirmation was exhibited before the trial court and in the record of appeal to inform the appellant that she was earmarked for the redundancy process. She was all the same issued with a termination letter referring to that general letter said to be a notice of intended redundancy. 26.The court notes that as per the termination letter the Respondent offered to pay the Appellant her terminal dues in three installments but never honoured the same necessitating the Appellant to seek redress in court only to make a partial payment on 24th September, 2024 while the case was ongoing in the trial court before the main hearing. 27.To this end this court is of the view that the Respondent did not fully comply with section 40 of the Act as the payment was made after the Appellant initiated the case in lower court while a proper reading of the section is clear that those payments were to be made before an employee is declared redundant. 28.Further, the Respondent did not illustrate if the Appellant was consulted to discuss a way out of the imminent redundancy as there were no minutes of a meeting held in that regard yet it is a legal requirement. The Respondent also alleged that on its selection criteria that the Appellant joined them in 2022 which was again not true because as per the certificate of service the Appellant had worked with the Respondent since January 2016 hence the selection criteria questionable. 29.This court therefore does not agree with the trial court that the Respondent adhered to the laid down procedure of declaring the Appellant redundant under section 40 of the Act and finds the process was unlawful hence unfair termination.Whether the trial court erred by finding that the Appellant was paid her terminal dues. 30.The trial court found that the Appellant was paid all her terminal dues while dismissing the claim at the trial court. It is not in dispute that the Respondent paid the Appellant Kshs 103,283.35/= on 24th September, 2024 while the Appellant claimed Kshs 148,008/= leaving a balance of Kshs 44,724.65/=. The Respondent claimed that the Kshs 44, 724.65/= was statutory deductions as per section 49(2) of the Act paid to the relevant bodies. 31.Whereas it is true the damages are subject to the statutory deductions there was no evidence like a breakdown of a payslip to show payment to the relevant bodies by the Respondent and bearing in mind the period of separation of the parties herein the Respondent ought to have paid the balance of the claimed amount of Kshs 44,724.65/=. 32.Having overturned the trial court finding that the Appellant was lawfully terminated, the court proceeds to consider commensurate compensation for unfair termination taking into account the parameters set out under section 49 of the Act. The respondent did not follow proper procedure in terminating the appellant’s service on account of redundancy as already found. Further, the respondent never paid the appellant her terminal dues upon redundancy until she filed a suit against the respondent claiming the same yet the dues were her lawful entitlement despite the flawed redundancy and considering the appellant had served the Respondent for seven years before she was unfairly terminated, six months’ salary would be appropriate compensation in the circumstances. The court notes that the appellant had already been paid severance. 33.In conclusion the Appellant's Appeal succeeds with costs to the Appellant while setting aside the trial court’s judgment as follows: -i.Damages for unfair termination 6 months x 25,000…Kshs. 150,000/=ii.Balance of the terminal dues Kshs 44,724.65/=Total: 194,724.65/= 34.It is so ordered. DATED AT NAIROBI THIS 19TH DAY OF JUNE, 2026DELIVERED VIRTUALLY THIS 19TH DAY OF JUNE, 2026ABUODHA NELSON JORUMPRESIDING JUDGE-APPEALS DIVISION