https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1287

Ndung’u & 6 others v Plan International Inc (Civil Appeal 76 of 2020) [2026] KECA 1287 (KLR) (10 July 2026) (Judgment) Neutral citation: [2026] KECA 1287 (KLR) Republic of Kenya In the Court of Appeal at Nairobi Civil Appeal 76 of 2020 P Nyamweya, LA Achode & AO Muchelule, JJA July 10, 2026 Between Josephine M Ndung’U 1st Appellant Job Ireri 2nd Appellant Billy Wellington Kinyua 3rd Appellant Jane Wambui Gitau & Millicent Njoki Gitau (Suing as administratrix of the Estate of Maureen Wanjiku Kamenderi) 4th Appellant Hudson Lubang'a Kadagi 5th Appellant Bwibo Adieri 6th Appellant Martin Anthony Njogu Kimemia 7th Appellant and Plan International Inc Respondent (Being an appeal against the judgment of the Employment & Labour Relations Court at Nairobi (Makau J.) dated 11th October 2019 in ELRC No. 1859 of 2014) Judgment 1.Josephine M. Ndung’u, Job Ireri, Billy Wellington Kinyua, Jane Wambui Gitau & Millecent Njoki Gitau (suing as administratrix of estate of Maureen Wanjiku Kamenderi), Hudson Lubang’a Kadagi, Bwibo Adieri and Martin Anthony Njogu Kimemia, the 1st to 7th appellants respectively, are seeking to have a second bite at the cherry, through this appeal brought against the judgment of the Employment and Labour Relations Court in Nairobi, by Makau J. in favour of Plan International Inc, the respondent herein. 2.The suit that culminated in this appeal was provoked by the restructuring of the respondent’s business to reduce the costs of operation. On 30th June 2014, the respondent’s Country Director issued a memo to all staff of the respondent notifying them that the report of a proposed restructuring had been approved. As a result, the staff positions were either downsized or abolished altogether. A total of forty members of staff including the appellants were laid off. 3.Aggrieved by this move, the appellants filed a memorandum of claim dated 16th October 2014 and amended on 25th October 2018 stating that their termination was unfair, wrongful and discriminatory and that the respondent did not comply with section 40 of the Employment Act (the Act). They therefore sought damages as follows:a.The first appellant:i.Compensation for loss of employment (12 months) - kshs.3,304,164;ii.Damages for defamation, loss of reputation and future career growth – Kshs, 2,500,000;iii.Damages for being subjected to discriminatory practice while in employment – Kshs. 5,000,000;iv.Damages for being subjected to unfair performance appraisal – Kshs. 150,985;v.Damages for denial of 3% salary increase – Kshs. 150,195.00,vi.The respondent to withdraw the letters on biased performance from her file.Totaling Kshs. 10,955,149.b.The second appellant:i.Compensation for loss of employment (12 months) – Kshs. 1,200,552;ii.Damages for defamation, loss of reputation and future career growth – Kshs 2,500,000,iii.Damages for being subjected to harsh and discriminatory practices while in employment - Kshs. 5,000,000.Totaling Kshs. 8,700,552.c.The third appellant:i.Compensation for loss of employment (12months) – ksh.1,459,596,ii.Damages for defamation, loss of reputation and future career growth – Kshs. 2,500,000,iii.Damages for being subjected to harsh and discriminatory practices while in employment – Kshs. 5,000,000.Totaling Kshs. 8,959, 596.d.The fourth appellant:i.Compensation for loss of employment (12 months) – Kshs. 2,015,640; damages for defamation, loss of reputation and future career growth – Kshs 2,500,000;ii.Damages for being subjected to discriminatory practices while in employment – Kshs. 5,000,000.Totaling Kshs. 9,515, 640.e.The fifth appellant:i.Compensation for loss of Employment (12 months) – Kshs. 2,236,668;ii.Damages for defamation, loss of reputation and future career growth – Kshs. 2,500,000,iii.Balance of year 2014 performance-based pay bonus– Kshs. 22,367;iv.Damages for being subjected to harsh and discriminatory practices while in employment – Kshs. 5,000,000.Totaling Kshs. 9,759,035.f.The sixth appellant:i.Compensation for loss of employment (12 months) – Kshs. 4,446,228;ii.Damages for defamation, loss of reputation and future career growth – Kshs. 2,500,000;iii.Damages for being subjected to harsh and discriminatory practices while in employment – Kshs. 5,000,000.Totaling Kshs. 11,946,228.g.The seventh appellant:i.Compensation for loss of employment (12 months) – Kshs. 1,328,640;ii.Damages for defamation, loss of reputation and future career growth – Kshs. 2,500,000;iii.Damages for being subjected to harsh and discriminatory practices while in employment – Kshs. 5,000,000.Totaling Kshs. 8,828,640. 4.In rebuttal, the respondent filed a Reply dated 10th November 2014 to the Memorandum of Claim and denied that the employment of the appellants was at any point illegally or unlawfully terminated. It averred that the restructuring/ realignment was carried out in accordance with the law and there was no discrimination, unfairness or specific targeting of employees during the restructuring exercise. The respondent denied that the appellants suffered any loss or damages as sought in the statement of claim. It asserted that the employees affected by the restructuring program were paid handsome redundancy packages, way above the provisions of the Employment Act. 5.When the matter came up for hearing, all the appellants, save for the 7th appellant, whose written statement was adopted in court by consent, testified to support their claims. Scholastica Wangui Ndirangu (RW1) testified in defence of the respondent case. A brief recap of the evidence tendered is necessary to put the appeal into perspective. 6.Josephine Muthoni, the 1st appellant, testified as CW1 and stated that she had served the respondent since 1998 as Administration Manager and head of administration functions. That a new Country Director appointed in 2013 began violating organizational procedures, particularly in procurement and compliance matters and when CW1 raised these concerns, she was sidelined and targeted. She stated that the restructuring process was initiated without her involvement, relied on a consultant irregularly procured, and produced a report that was rejected by the Country Management Team (CMT). She contended that her position was not genuinely abolished but merely renamed and she was replaced while on leave. She further alleged that she was falsely accused of corruption, subjected to a performance improvement plan without justification. According to CW1 the redundancy was a scheme to remove her for insisting on adherence to procedures and the process was flawed, discriminatory, and not a genuine redundancy. 7.Bwibo Arieri (CW2), the 6th appellant, testified that he held the position of Head of Programs and that the restructuring process was irregular and unnecessary. That the consultancy process was procedurally flawed and the resulting reports were rejected by the CMT. He contended that his role was redistributed to newly created positions designed to edge him out and he was excluded from management functions, denied access to his office, and subjected to a hostile work environment after receiving the redundancy notice. He eventually resigned due to these intolerable conditions, which he attributed to discrimination and victimization. 8.Billy Wellington Kinyua (CW3), the 3rd appellant, testified that his redundancy was predetermined as he had been informed in advance that he would lose his job. He stated that his position was not abolished but was replaced with a similar role given to a junior employee with less qualifications. Defamatory statements were published about him, damaging his reputation and employment prospects. He maintained that the restructuring process was flawed, lacked transparency, and was used to unjustly remove him from employment. 9.Hudson Lubanga Kadagi (CW4), the 5th appellant, testified that he was serving as a Senior Accountant. His position was not abolished. It was downsized and he was advised to apply for a new position but he declined, believing that his existing contract remained valid. He stated that the redundancy notice he received had inconsistent dates and he was removed as a bank signatory, which he perceived to be discriminatory treatment. He maintained that his position continued to exist under another individual and that he was unfairly targeted and underpaid on certain benefits. 10.Millicent Njoki Gitau (CW5), testifying on behalf of the estate of the 4th appellant, stated that the deceased had been employed as a Disaster Preparedness and Response Coordinator until she was declared redundant. That although there were comparable positions, only the deceased was declared redundant. That she had been unwell and receiving the redundancy notice worsened her condition, eventually leading to her death. She denied that the redundancy was justified and maintained that the deceased had been unfairly treated and defamed. 11.Job Ireri (CW6), the 2nd appellant, testified that he served as Procurement Coordinator and his role continued under a different title after the restructuring. He stated that he was targeted for questioning procurement irregularities by the Country Director, and was subjected to disciplinary proceedings based on allegations of corruption that were later cleared. It was his claim that the redundancy was not genuine, that he was excluded from the restructuring process, and that the changes were merely cosmetic renaming of positions to justify his removal. 12.Martin Anthony Njogu Kimemia, the 7th appellant, stated through a written statement that he was the Project Officer until his termination on grounds of redundancy. He further stated that he was unfairly selected for redundancy without being informed of the criteria used, and that he was the only employee affected within his unit, despite others holding similar roles and the redundancy was procedurally and substantively unfair. 13.In response, Scholastica Wangui Ndirangu (RW1), the respondent’s Human Resource Manager, testified that the redundancy process arose from a genuine organizational restructuring and was conducted lawfully and procedurally. Her evidence was that in 2013 staff members raised concerns regarding the management and operational structure of the organization, including issues relating to reporting lines, authority levels, organizational structure, and job designations. 14.RW1 stated that in response to the concerns of the employees, the respondent engaged consultants to undertake a rapid structural assessment review focused on the Kenya Country Office. She denied allegations that the consultants were irregularly procured and stated that several consultants applied and were considered before one was appointed. The consultant’s review established that the respondent’s organizational structure required realignment to achieve operational efficiency, growth, and sustainability. 15.According to RW1, the restructuring process was also necessitated by a substantial reduction in donor funding and the need to reduce operational costs. That the Country Management Team (CMT), which included some of the appellants, participated in the restructuring process and employees were invited to contribute through questionnaires and consultations conducted by the consultants. 16.RW1 testified that employees were kept informed throughout the restructuring exercise through various memoranda issued by the Country Director. All affected employees including the appellants, were advised of the outcome of the review process, informed of the positions affected and notified of the intended redundancies. Approximately forty positions were affected through abolition, amalgamation, or downsizing, and the employees occupying those positions were encouraged to apply for newly created or reorganized positions within the new structure. 17.It was RW1’s evidence that the restructuring exercise was not intended to target the appellants, or replace local staff with foreigners as alleged. That the exercise was a legitimate organizational realignment aimed at streamlining operations and improving efficiency. Some positions were abolished altogether, while others were enlarged, amalgamated, or downsized. Specifically that the 1st appellant’s position was converted from Administration Manager to Administration and Logistics Manager with expanded duties; the 2nd appellant’s role became Senior Logistics and Procurement Coordinator with additional responsibilities; the 3rd appellant’s Office Administrator role and that of the 4th appellant were abolished; the 5th and 7th appellants’ positions were downsized; the 6th appellant’s position was abolished and replaced with a new managerial role. 18.RW1 further testified that all affected employees received redundancy notices and were advised to apply for the available positions within the reorganized structure, but the appellants declined to do so. Some of the appellants instead tendered resignation letters before expiry of the redundancy notice period. She maintained that the respondent complied with the applicable redundancy procedures, including notifying the Labour Office through a letter dated 7th July, 2014 and paying all terminal dues due to the appellants. 19.During cross-examination, RW1 acknowledged that she joined the respondent after the redundancy exercise had already occurred and that her testimony was based on the records and documents filed by the organization. She nevertheless asserted that the redundancy process was lawful and justified. She confirmed that the Labour Office had been notified and that the restructuring was prompted both by staff concerns and financial constraints affecting the organization. Further that after the restructuring, some job titles changed while core functions remained substantially similar, although additional duties were introduced in several positions. 20.RW1 further admitted that she was unaware whether individual appellants specifically gave their views on the restructuring of their positions and confirmed that no apology was issued to the 1st and 2nd appellants after they were cleared of corruption allegations. That nonetheless, the restructuring and redundancy exercise complied with the Employment Act and the respondent’s internal procedures. 21.O.N. Makau J. considered the matter, and in a judgment dated 11th October 2019, found that the termination of the appellants’ employment was not unfair or unlawful and that the appellants had failed to prove that they were discriminated against and defamed by the respondent. He dismissed the suit and ordered each party to bear their own costs. 22.Aggrieved by the judgment, the appellants filed the present appeal. In the memorandum of appeal dated 17th February, 2020 they raised twelve grounds. In sum they assailed the learned trial Judge for:i.Finding that the appellants’ redundancy and termination were fair, lawful, and justified.ii.Failing to find that the respondent breached its internal procurement and operational procedures during the restructuring process.iii.Failing to find that the redundancy process violated section 40 of the Employment Act, including lack of proper notice, consultation, and application of selection criteria.iv.Failing to appreciate that the appellants’ positions were not genuinely abolished, as their duties continued under renamed or re-advertised positions filled by other employees.v.Finding that the redundancy was necessitated by operational and financial reasons despite insufficient evidence.vi.Failing to properly consider the appellants’ evidence on discrimination, defamation, and unfair treatment.vii.Breaching the appellants’ right to a fair hearing by relying on matters not properly before the court and admitting late submissions without granting a right of reply 23.The firm of M/s Chamwada & Company Advocates filed submissions dated 16th October 2020 on behalf of the appellants, and compressed their grounds of appeal into two issues. These were whether the appellants’ termination on the ground of redundancy was unfair and whether the appellants were discriminated against. 24.The appellants submit that their employment relationship was governed not only by the Employment Act and their contracts of employment, but also by the respondent’s Personnel Policy Manual, Global Operations Manual, and applicable international labour standards. They urge that the restructuring and redundancy exercise ought to have been carried out strictly in accordance with those procedures and policies. 25.They assert that the respondent fundamentally breached its procurement and operational procedures in engaging Active Engagement Consultants to undertake the restructuring process. According to the appellants, the Country Director single-sourced the consultant without complying with mandatory procurement requirements relating to preparation and approval of terms of reference, competitive bidding, tender evaluation, procurement committee participation, and conflict- of-interest safeguards. They argue that the consultant lacked the requisite qualifications and had been improperly engaged through a flawed process controlled solely by the Country Director. 26.The appellants also contend that the trial Judge disregarded uncontroverted evidence showing that the consultancy reports underpinning the restructuring exercise had been rejected by the Country Management Team (CMT). That the trial court therefore erred in concluding that the restructuring had been lawfully approved by the CMT, the Regional Director, and the Regional Operations Management Team. 27.In addition, they submit that the learned Judge improperly relied on internal memoranda allegedly indicating that staff had raised concerns regarding organizational structure and management. According to the appellants, there was no evidence that staff had raised the concerns relied upon by the respondent, or that the memoranda had been properly circulated to employees. They urge that the alleged operational and financial reasons for the restructuring lacked evidentiary support. 28.The appellants challenge the learned Judge’s reliance on the doctrine of managerial prerogative. They argue that the court was required to intervene where an employer acts contrary to statute, or its own internal procedures. They rely on the case of Geoffrey Mworia v Water Resources Management Authority & 2 Others [2015] eKLR, for the proposition that managerial prerogative must be exercised within the confines of the law, contractual terms, and internal procedures. 29.It is contended that the redundancy was not genuine because the appellants’ positions were not in fact abolished. That the evidence demonstrated that their functions continued to exist under altered job titles and were subsequently performed by other employees, including junior staff and externally recruited persons. They rely on evidence showing that they were required to train or hand over duties to incoming employees, which in their view confirmed that the positions remained operational. 30.The appellants draw reference to specific examples including evidence that the 1st appellant’s role was advertised while she was on leave and she was instructed to orient her replacement; the 2nd appellant’s role merely changed titles while retaining substantially similar functions; the 3rd appellant’s duties were assigned to a receptionist; the 5th appellant’s accounting role continued under another employee; and, the 6th appellant’s functions were reassigned to a consultant and the Country Director. 31.They appellants posit that the redundancy process violated section 40 of the Act because they were not individually notified in advance of the intended redundancy and because the Labour Office was notified only after the redundancy process had already commenced. They argue that the respondent failed to apply the statutory selection criteria relating to skill, ability, reliability, and disciplinary record, notwithstanding their long years of service and experience. They urge that the trial Judge erred in concluding that they had been adequately involved in the restructuring process when no meaningful consultation took place, and the respondent merely communicated decisions that had already been finalized. 32.The appellants point out that the respondent’s own witness admitted that she was unaware whether the appellants were consulted regarding the restructuring of their positions. Further, that the trial court failed to properly consider their evidence concerning discrimination, unfair treatment, and victimization. They urge that they were selectively targeted, humiliated, excluded from meetings, and replaced by junior or preferred employees. 33.The firm of M/s Igeria & Ngugi Advocates filed submissions dated 8th December 2020 on behalf of the respondent in support of the judgment of the trial court. The respondent contends that the redundancy exercise was both substantively and procedurally fair. It posits that since the appellant submitted on two issues, namely whether the termination of the appellants on account of redundancy was unfair and unlawful, and whether the appellants had been discriminated against, the other grounds of appeal are deemed to be abandoned. 34.The respondent argues that the appellants’ services became superfluous following a legitimate restructuring and realignment exercise aimed at improving efficiency, streamlining reporting structures, and addressing reduced funding levels. It contends that redundancy constitutes a lawful ground for termination, where it is based on the operational requirements of the employer. In support of this proposition, it relies on sections 2, 43, and 45 of the Act and Article 4 of the International Labour Organization (ILO) Convention No. 158. 35.The respondent further, relied on the New Zealand Court of Appeal decision in Aoraki Corporation Limited v Colin Keith McGavin CA 2 of 1997 [1998] 2 NZLR 276, where the court held that redundancy is a special situation in which employees may lose their jobs because the positions have become superfluous to the employer’s operational requirements. The respondent also relied on Kenya Airways Limited v Tobias Oganya Auma & 5 Others (2007) eKLR, for the proposition that an employer is entitled to reorganize its business and adopt more efficient operational structures provided the relevant legal requirements are observed. 36.In addition, the respondent urges that the restructuring process was justified by genuine operational concerns that had been raised internally by staff members. It referred to several internal memoranda circulated to employees between 2013 and 2014 concerning organizational structure, reporting lines, management inefficiencies, and reduced donor funding. According to it, the memoranda demonstrated that employees had been kept informed of the restructuring process and that the realignment exercise was neither arbitrary nor malicious. 37.In answer to the appellants’ allegation that the consultants had been unlawfully procured, the respondent argues that the restructuring process involved third-party consultants as part of a legitimate organizational review exercise. It urges that several consultants applied for the assignment and the selected consultant underwent a competitive recruitment process. Additionally, the appellants’ complaints concerning procurement procedures related to internal administrative matters rather than labour relations issues and therefore, could not invalidate the redundancy process. 38.Regarding procedural fairness, the respondent asserts that it fully complied with section 40 of the Act. That the appellants, who were not unionized employees, were issued with redundancy notices and the Labour Office was duly notified. In support of the adequacy of the notices, the respondent relied on Judy Lisiet Indolo v Fatumah Ali Dabaso v First Community Bank Limited [2018] eKLR where the court emphasized that the evidential value of a notice depends on proof that the employee acknowledged receipt. The respondent urges that the appellants received and acknowledged the notices and were therefore properly notified. 39.The respondent urges that there was adequate consultation before the redundancies were implemented. It contends that employees were updated continuously through office memoranda and meetings from as early as August 2013 regarding the ongoing restructuring process, the involvement of consultants, the proposed organizational review, and the likely positions to be affected. The respondent contends that the 2nd 3rd and 4th appellants specifically attended meetings where they were informed that their positions would be affected by the restructuring. 40.The respondent further argues that the redundancy exercise complied with the applicable selection criteria under section 40(1) (c) of the Act and Article 23 of International Labour Organization (ILO) Recommendation 166. That the restructuring exercise resulted in abolition, downsizing, and realignment of positions held by the appellants. According to the respondent, the affected employees were given priority and an opportunity to apply for newly created or reorganized positions, but several of the appellants declined to do so, while the 6th and 7th appellants voluntarily resigned. 41.The respondent disputes allegations that the appellants’ positions continued to exist unchanged after the restructuring.It submits that the positions advertised after the realignment differed substantially from the previous positions held by the appellants, and formed part of a new organizational structure. The respondent points to the evidence showing that some of the affected positions were abolished entirely, while others were expanded or redesigned. 42.Concerning allegations of discrimination, the respondent denies that the appellants were singled out unfairly. It contends that the restructuring exercise affected multiple positions across the organization and that the appellants were treated in the same manner as other affected employees. The respondent argues that some of the positions previously held by the appellants were genuinely abolished, while others were substantially reorganized into different positions with altered duties and responsibilities. It further argues that the appellants could not claim discrimination after declining opportunities to apply for available positions. 43.During the hearing of the appeal, Mr. Chamwada learned counsel appeared for all the appellants and relied on the written submissions. Counsel urged that the findings of the trial court were not backed by evidence and no reasons were given for redundancy. Further, that the redundancy was premeditated because the staff could not have complained to a new person just arriving on the scene. There was no appearance for the respondent although their advocates M/S Igeria and Ngugi Advocates had been duly served. 44.This being the first appeal, we are cognizant that it is our duty to reappraise the evidence and draw inferences of fact in the matter as provided under Rule 31(1) of the Court of Appeal Rules, 2022. This mandate of the first appellate court was well captured by this Court in Kenya Ports Authority v Kuston (Kenya) Limited (2009) 2 EA 212 as follows:“On a first appeal from the High Court, the Court of Appeal should reconsider the evidence, evaluate it itself and draw its own conclusions though it should always bear in mind that it has neither seen nor heard the witnesses and should make due allowance in that respect. Secondly that the responsibility of the court is to rule on the evidence on record and not to introduce extraneous matters not dealt with by the parties in the evidence.” 45.Having considered the record of appeal, the law and the rival submissions, we are of the view that determination of the two issues identified by the appellants and on which both parties submitted will resolve the dispute. The two issues are: whether the appellants’ termination on the ground of redundancy was unfair and unlawful; and, whether the appellants were discriminated against. We shall quote the trial court in extenso on each issue to establish whether or not the court erred in its reasoning. 46.Redundancy is defined under section 2 of the Act as the loss of employment through no fault of the employee where the services of the employee become superfluous due to operational requirements of the employer. However, even where redundancy is founded on legitimate operational reasons, the employer must demonstrate substantive justification and strict compliance with the mandatory procedural safeguards set out under sections 40, 43, and 45 of the Act. 47.Section 40 of the Act which deals with termination of employment on account of redundancy provides as follows:“(1)An employer shall not terminate a contract of service on account of redundancy unless the employer complies with the following conditionsa.here 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 extend 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; andg.the employer has paid an employee declared redundant severance pay at the rate of not less than fifteen days’ pay for each completed year of service.” 48.The burden placed upon the employer to prove the reasons for termination are found in section 43 (1) of the Act. The section provides that:“(1)In any claim arising out of termination of a contract, the employer shall be required to prove the reason or reasons for the termination, and where the employer fails to do so, the termination shall be deemed to have been unfair within the meaning of section 45.(2)The reason or reasons for termination of a contract are the matters that the employer at the time of termination of the contract genuinely believed to exist, and which caused the employer to terminate the services of the employee.” 49.In the present case, the appellants challenge both the substantive and procedural validity of the redundancy. They contend that the restructuring process was not genuine but rather a scheme orchestrated to remove them from employment following disagreements with the Country Director. They argue that the positions allegedly abolished continued to exist under altered titles and were subsequently occupied by other employees. 50.On the contrary, the respondent maintains that the restructuring and redundancy exercise was prompted by operational inefficiencies, excessive reporting lines, and reduced donor funding. That the Memoranda circulated between 2013 and 2014 indicated that organizational reviews had been undertaken with the objective of increasing efficiency and reducing operational costs. The respondent asserts that the appellants’ positions became redundant following a legitimate restructuring process. 51.The learned trial Judge found that redundancy was substantially justified and had this to say:“74.In view of the evidence by the respondent that the staff had raised issues with the management and running of the organization, organizational structure, reporting lines, levels of authority, job designations among others and the fact that there was reduced funding, I find that the respondent was justified to undertake the organizational, programme and logistics & administration review. Cw3 admitted during cross examination that the Country Director notified all the staff by a Memo Dated 24.2.2014 that donor funding had gone down. He further admitted that the Director had issued an earlier Memo in August 2013 about the complaints by staff regarding reporting structure75.I further find that the exercise of restructuring and realignment was lawful because Cw3, who was the head of procurement, admitted in evidence that the consultant who was contracted was picked from among several consultants who had applied for the job. I further find the exercise lawful because the report was approved by the majority of CMT, the Country Director, the Regional Director and the ROMT. Even if the CMT had rejected the report, the Country Director alone could sanction the report and validate the restructuring/ realignment exercise. The foregoing view is based on the admission by Cw2 during cross examination that under the CMT Charter, the Country Director can overrule the decision of the CMT.77.It is without dispute from the evidence tendered that the restructuring exercise resulted in abolition, amalgamation, and downsizing of some positions including those previously held by the claimants. It is also common knowledge that all the claimants among the other affected staff were advised to reapply for the new and also the downsized positions upon their advertisement or exit through redundancy. It is also clear that the claimants declined to apply for the said vacancies within the set timelines and they were served with six months’ redundancy notice.78.In this courts view, the employer was justified to lay off the claimants after failing to show any interest in serving in available positions under the new organizational structure. The employer could not continue to employ them in non-existent positions which had been phased out or realigned in an effort to ensure efficient and effective management of the organization. The court cannot interfere with the employer’s managerial prerogative which is lawfully done with the aim of achieving strategic business sustainability and efficiency and especially where the employer deems that there is bloated workforce, blurred chain of command and control, and high operational cost.” 52.For the redundancy test, we turn to the decision of this Court in Kenya Airways Ltd v Aviation & Allied Workers Union Kenya & 3 others [2014] KECA 404 (KLR) where the Court held as follows:“It is not necessary to consider all the reasons that the learned Judge gave for his decision that the Airline did not act reasonably. What the learned Judge essentially decided was that redundancy was not commercially necessary and that more consultation was necessary. This was a wrong test. As long as the employer genuinely believed that there was a redundancy situation, any termination was justified and it was not for the court to substitute its business decision of what was reasonable. The Court has no supervisory role. (Emphasis added)” 53.Additionally, we have in mind the decision of the Court of Appeal of New Zealand in Aoraki Corporations Limited V. Collin Keith McGavin; CA 2 of 1997 [1998] 2 NZLR 278 for the proposition that a declaration in relation to redundancy depends on the commercial judgment of the employer. In that decision the Court held that:“…It is convenient in other termination cases, and essential in redundancy cases, to consider whether the dismissal was substantively justified. Thus if dismissal is said to be for a cause it may be substantively unjustified in the sense of a cause not being shown or being subject to significant procedural irregularity as to cast doubt upon the outcome….Redundancy is a special situation. The employees have done no wrong. It is simply that in the circumstances the employer faces, their jobs have disappeared and they are considered superfluous to the needs of the business. Where it is decided as a matter of commercial judgment that there are too many employees in the particular area or overall, it is for the employer as a matter of commercial judgment to decide on the strategy to be adopted in the restructuring exercise and what position or positions should be dispensed with in the implementation of that strategy and whether an employee whose job has disappeared should be offered another position elsewhere in the business.It cannot be mandatory for the employer to consult with all potentially affected employees in making any redundancy decision. To impose an absolute requirement of that kind would be inconsistent with the employer’s prima facie right to organize and run its business operation as it sees fit. And consultation would often be impracticable, particularly where circumstances are seen to require mass redundancies. However in some circumstances an absence of consultation where consultation would reasonably be expected may cast doubt on the genuineness of the alleged redundancy or its timing. So, too, may a failure to consider any redeployment possibilities.” 54.What is to be understood is that an employer retains the managerial prerogative to reorganize its operations and restructure its workforce for purposes of efficiency and sustainability, provided the law is complied with. 55.In the present case, the appellants challenge the legality and propriety of the process through which Active Engagement Consultants were engaged to undertake the respondent’s restructuring and realignment exercise. Their contention is that the consultancy process violated the respondent’s own procurement and operational procedures and consequently tainted the entire redundancy exercise. 56.The respondent, on the other hand, contends that the consultancy process was competitive and legitimate. That several consultants applied for the assignment and Active Engagement Consultants were selected following interviews and evaluation. The respondent urges that the procurement issues raised by the appellants were internal administrative matters that did not affect the legality of the redundancy exercise itself. 57.Upon consideration of the evidence, it is clear that there were procedural concerns surrounding the sourcing of the consultants. The appellants produced evidence suggesting that Active Engagement Consultants may not have been formally prequalified before the award and that aspects of the procurement process were handled directly by the Country Director. There was also evidence indicating dissatisfaction by some members of the Country Management Team regarding the consultant’s appointment and the restructuring reports produced. 58.However, the question before the Court is not merely whether there were imperfections in the internal procurement process, but whether such irregularities rendered the redundancy exercise unlawful. The answer must be found within the context of the Act and the scope of judicial intervention in managerial decisions. In Kenya Airways Ltd and Aoraki Corporations Limited supra it is acknowledged that employers retain the managerial prerogative to reorganize their operations provided the restructuring is undertaken in compliance with the law. Further, that restructuring decisions are fundamentally commercial judgments made by employers in response to their operational needs. 59.We observe that the respondent undertook an organizational restructuring exercise following concerns relating to operational inefficiencies, reporting structures, bloated management systems, and reduced donor funding. Internal memoranda circulated to employees between 2013 and 2014 informed staff of the intended organizational review and the anticipated realignment of positions. In addition, there was evidence that several consultants expressed interest in the assignment and that the restructuring process involved consultations and organizational reviews extending over several months. 60.While we note that the procurement process may not have been flawless, the appellants did not establish that the alleged procedural irregularities fundamentally invalidated the restructuring exercise, or that the consultant lacked the technical competence to undertake the assignment. More importantly, the determinative question under sections 40, 43, and 45 of the Act remains whether there existed valid operational reasons for redundancy, and whether the mandatory procedural safeguards applicable to employees were observed. 61.We therefore find that the procedural shortcomings, or internal disagreements regarding the sourcing of Active Engagement Consultants, did not displace the evidence demonstrating that the respondent had operational reasons for restructuring. The redundancy was substantially justified according to section 40 and 43 of the Act. 62.On procedural fairness, the appellants argue that notice to the Labour Office was belated because the redundancy process had already commenced, but the respondent asserts that it complied with section 40(1) (b) of the Act. 63.The learned trial Judge found that section 40 (1) (b) of the Act was complied with and held thus:“80.The Claimants like all the other staff were notified of the intended redundancy the Memo dated 30th June 2014. The 1st, 2nd ,3rd,4th ,6th and 7th Claimants were further individually notified of the redundancy of their respective positions vide the letters dated 30th June 2014 while the 5th Claimant was informed vide the letter dated 3rd July 2014. The letters provided that the redundancy was to be effective on 31st December 2014 and 31st January 2015 respectively. The Respondent in her letters dated 10th September 2014 and 24th September 2014 shortened the notice period and informed the Claimants that they would not serve the full redundancy notice period and that they would be redundant on 12th September 2014 and 30th September 2014.81.In that respect the 5th Claimant avers that his redundancy letter was backdated and informed that he would be declared redundant from 1st August 2014, and the explanations for this as given in the emails sent on 20th August 2014 and 11th September 2014 stated that the reason for this was that he had not reapplied for a new position.85.In respect of the notice to the labour officer, the Respondent in her letter dated 7th July 2014 and received on 14th July 2014, the Respondent informed the Cabinet Secretary, Ministry of Labour, Social Security and Services of the redundancy. She outlined the redundant positions as Strategic Program Manager, Research and Documentation Manager, WASH Advisor, Learning Advisor, Emergency Response Coordinator, Grants Manager, Grants Officer, Administration Manager, Office Administrator, Procurement Coordinator (Nairobi Based) and Project Officer (end project). It further informed the Cabinet Secretary of the downsized positions and that the staff occupying the downsized positions would be given the first priority to apply for the new jobs”. 64.This Court has held in numerous decisions that it is mandatory for the employer to comply with section 40 of the Act in the process of declaring redundancy. In Kenya Airways Ltd supra it was held that:“Though contractual, employment relations have some sort of statutory underpinnings. Part VI of the Employment Act 2007 in a nutshell outlaws unreasonable or unjustified termination of employment. Though it requires an employee to prove that the termination of his employment was unlawful, in my view, it places a heavier burden of proof upon the employer to justify any termination of employment. Section 40(1) of the Employment Act, which provides for the implementation of the redundancy decision, provides in mandatory terms that “[a]n employer shall not terminate a contract of service on account of redundancy unless … [he] complies with the … conditions” therein stipulated. As this is the central provision in the second issue of fair play in redundancy that we need to determine in this this appeal, I need to set it out verbatim.” 65.On the length of notice prior to termination on account of redundancy under section 40 (1) (b) of the Act, we refer to the decision of this Court in Africa Nazarene University v David Mutevu & 103 others [2017] KECA 381 (KLR) where it was held as follows:“We agree with that construction as well as the observation that subsection (b) says nothing about the length of the notice or the contents. In our view, however, the only difference in both sub-sections is whether an employee is a member of a trade union or not. A proper construction of both subsections would show that the phrase:"...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."…is common to both kinds of employees. So that, whether an employee belongs to a trade union or not, the reasons and period of notice should be spelt out. 66.In the case before us, the record shows that redundancy notices were issued to the appellants on 30th June, 2014 and 3rd July, 2014, while the Labour Office was notified by letter dated 7th July, 2014. The appellants’ termination dates were 12th September, 2014 and 30th September, 2014, respectively. We therefore agree with the learned trial Judge that the respondent complied with section 40 (1) (b) of the Act. 67.The appellant also assails the learned trial Judge for holding that all the restructured positions were advertised and that the appellants declined to apply. It is stated that the 3rd appellant’s position was not advertised and that at the time of advertising other positions, the 1st appellant was on leave and other appellants’ contracts were still subsisting. In response, the respondent urges that, save for the position of the 5th appellant, all other appellants’ positions were abolished. That section 40 (1) (3) of the Act was therefore inapplicable, as the appellants were advised to apply for the new positions advertised by the respondent. 68.The learned trial Judge considered whether section 40 (1) (3) of the Act was properly applied in relation to the process of redundancy and held that:“92.In respect of the selection criteria the Respondent does not dispute that the claimants were senior employees of long service including the 1st Claimant who served for 16 years, the 2nd Claimant for 17 years, 3rd Claimant for 7 years, 4th Claimant for 5 years, 5th Claimant for 20 years and the 7th Claimant for 12 years. The Respondent advertised all new and downsized positions after the restructuring exercise and as already observed herein above, the claimants declined to apply despite express advice from the employer. As a result, other people applied including the claimants’ juniors in the organization and they were appointed. I agree with the Respondents case that the refusal to apply for the new or downsized positions by the Claimants meant that they had opted to exit through redundancy and as such they could not be considered for the jobs. The employer could also not force appointment on the 6th and 7th claimants who tendered resignation letters dated 1.8.2014 and 27.8.2014 after being served with redundancy notices.93.It follows that had the claimants expressed interest in the available positions by reapplying as advised, the employer would have been bound to use the criteria set out in the statute to select the best suited candidate including length of service, skill and ability. In my view, where restructuring has been done to ensure operational efficiency, it is in order for the employer to select the people for redundancy by requiring the employees in the affected positions to reapply for the new and downsized positions. In that case, the failure to apply means one has chosen to exit through redundancy. I therefore return that section 40 (c) was complied with.” 69.We observe that most of the positions held by the appellants were abolished, save for the 5th respondent’s position that was downsized. We agree with the respondent that the criteria under section 40 (1) (c) of the Act was not applicable in this circumstance. We hasten to add that nothing prevented the appellants from applying for the new structured positions as advised by the respondent. We therefore, find that this section was not contravened by the respondent. 70.Turning to the second issue, the appellants allege that they were discriminated against during the restructuring and redundancy exercise. They contend that they were selectively targeted, excluded from meetings, subjected to hostile treatment, and unfairly replaced by junior or preferred employees. The respondent on its part urges that it fully and sufficiently discharged its burden of proof in confirming that it did not discriminate against the appellants during their tenure of employment or in the declaration of redundancy. 71.On this the trial court had this to say:“96.In view of the finding that the restructuring and the resulting redundancy was justified and done through a fair procedure and the Employment Act and the respondent’s procedure Manual, I return that the alleged discrimination by the claimants is without merits. The evidence on record shows that the claimants were treated like all the other staff during the restructuring and redundancy exercise. Their views were sought like for the other staff. They were updated through the same Memos by the Country Director and they were served with redundancy notices like the other staff and paid dues computed the same way as the other staff”. 72.Article 27 of the Constitution guarantees equality and freedom from discrimination, while section 5 of the Act prohibits discrimination in employment on grounds such as race, sex, ethnicity, religion, disability, political opinion, and other protected characteristics. Section 5(7) of the Act places the burden upon the employer to disprove discrimination once an employee establishes a prima facie case. 73.In the case of Ol Pejeta Ranching Limited v David Wanjau Muhoro [2017] eKLR, this Court observed that discrimination occurs where an employee is treated differently from other employees similarly situated without reasonable and lawful justification. The Court emphasized that unequal treatment alone does not amount to discrimination, unless it is founded on improper or prohibited considerations. It referred to Article 1 of the Convention No. 111 – Convention Concerning Discrimination in Respect of Employment and Occupation, 1958 where discrimination is defined thus:“For the purpose of this Convention the term discrimination includes;Any distinction, exclusion or preference made on the basis of race, colour, sex, religion, political opinion, national extraction or social origin, which has the effect of nullifying or impairing equality of opportunity or treatment in employment or occupation,” [Emphasis added] 74.It is a timeless rule of the common law tradition (Kenya’s juristic heritage), and one of fair and pragmatic conception, that the party making an averment in validation of a claim, is always the one to establish the plain veracity of the claim. In civil claims, the standard of proof is the “balance of probability”. Balance of probability is a concept deeply linked to the perceptible fact scenario: so there has to be evidence on the basis of which the court can determine that it was more probable than not, that the respondent bore responsibility in whole or in part. (See- Dr Samson Gwer & 5 Others v Kenya Medical research Institute & 3 Others: Petition No. 12 of 2019 SCOK). 75.The appellants in this appeal did not identify any prohibited ground under Article 27, or section 5 of the Act upon which the alleged discrimination was founded. Their complaint was essentially that they were unfairly targeted during the restructuring process. While the evidence suggests that some appellants may have experienced strained working relationships with management, workplace dissatisfaction or managerial disagreement does not, without more, amount to discrimination in law. 76.The evidence before us does not establish that the appellants were treated differently from other employees affected by the restructuring. The record indicates, as noted by the trial court, that they received redundancy notices like other affected staff, were informed of the restructuring process through the same memoranda, and were accorded the same opportunity to apply for reorganized positions. 77.The allegation that some positions were subsequently filled by junior employees does not, in itself, establish discrimination. Organizational restructuring frequently results in redesigning positions, reassignment of duties, or appointment of different personnel under altered operational structures. In the absence of proof that the respondent acted on prohibited or arbitrary considerations, this Court cannot infer discrimination merely because the appellants disagreed with the restructuring outcome. 78.The appellants also alleged victimization arising from their criticism of the Country Director’s procurement and management practices. However, apart from generalized assertions, no cogent evidence was placed before the Court demonstrating that the redundancy exercise was motivated by retaliation or improper personal considerations. The respondent established that the restructuring exercise was organization- wide and driven by operational and financial concerns. 79.In our view, the appellants failed to establish a prima facie case of discrimination capable of shifting the burden of proof to the respondent under section 5(7) of the Act. The evidence does not disclose differential treatment founded on prohibited grounds, nor conduct amounting to arbitrary, or unlawful discrimination as contemplated under Article 27 and section 5 of the Act. Accordingly, we are not persuaded that the appellants proved discrimination on the part of the respondent. 80.For all the foregoing reasons we find that this appeal is lacking in merit and is therefore dismissed with costs to the respondent. 81.It is so ordered. DATED AND DELIVERED AT NAIROBI THIS 10TH DAY OF JULY, 2026.P. NYAMWEYA...................................JUDGE OF APPEALL. ACHODE...................................JUDGE OF APPEALA.O.MUCHELULE...................................JUDGE OF APPEALI certify that this is a true copy of the original SignedDeputy Registrar