Companies can still be forced to compensate employees they offloaded during the Covid-19 pandemic even if there were genuine reasons for reducing their workforce.
Employment and Labour Relation Court Judge Byram Ongaya noted that failure to take into account the required procedure in Section 40 of the Employment Act for terminating workers on account of redundancy makes such sackings unfair.
He made the ruling in a case where Ms Helen Mary Aluoch, who worked as a human resources manager at Diani Reef Beach Resort and Spa, sued the hotel for sacking her.
The judge said he found the reason for her sacking genuine, considering the impact of Covid-19 on the hospitality industry.
“The court has taken judicial notice of the outbreak and declaration of the Covid-19 pandemic in March 2020 and reckons that the reason for termination was genuine,” the judge said.
But he noted that though the reason for the sacking was valid, it was not properly executed as stipulated in the law.
Section 40 of the Employment Act states that if the employee is a member of a trade union, the latter should be notified together with the labour officer at least one month before the date of termination on account of redundancy.
Justice Ongaya said the hotel did not follow this procedure when it laid off Ms Aluoch.
“The court finds that to that extent the termination was procedurally unfair,” the judge said.
He added: “The respondent will pay the claimant a sum of Sh580,000 by June 1, (or) interest to be payable thereon at court rates from the date of this judgment till full payment.”
Ms Aluoch sued the hotel in July 2020 after being shown the door on April 30 due to reduced earnings following restrictions imposed by the Ministry of Health to contain Covid-19.
She challenged the manner of her sacking, noting that despite demanding the dues promised in the termination letter, she was not paid.
She also said the hotel had failed to settle medical bills on several occasions between April and September 2019, contrary to the terms, rights and obligations spelled out in her letter of employment.
“I was first asked to take a paid annual leave. The facility further imposed unpaid leave. I was then asked to work for eight days in April of the same year,” she said, adding that she was sacked thereafter.
She argued that the termination was unlawful, abrupt and unfair and contravened the law because there was no valid or fair reason for that decision.
“There was neither (a) hearing prior to the termination nor (a) notice. I was not paid accrued dues,” she said.
She also alleged malice, saying it manifested through abrupt eviction from a house provided by the hotel. She also said she was forced to sign documents to deny staff salaries.
The hotel, in response, denied that it employed the woman and that it paid all her dues before releasing her.
Through Chimera & Company Advocates, the hotel said the termination was fair and followed the law.
It also argued that the woman’s employment contract was frustrated following the outbreak of Covid-19, rendering her redundant.