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COVID 19 Layoffs and Redundancies: What are the provisions of the Employment Laws?

The COVID 19 Pandemic caught the entire world off guard, and all the countries have felt its weight. The virus has not spared any business, be it multi-national corporations or small enterprises. Due to the containment measures put in place, many companies have been unable to operate and have been forced to lay off most of their workforce. Kenya has been no different, and many people have lost their jobs. The Government in May stated that the pandemic had caused approximately 300,000 jobs to be lost. The hardest hit is the hospitality sector due to the ban on international flights. In May, the Fairmont Norfolk Hotel laid off all its employees in its Nairobi and Maasai Mara Resorts. The hotel has since reversed its decision. However, it is yet to be known when the employees return to work. In this article, we shall examine the provisions of the various employment laws and analyze the requirements regarding layoffs and redundancies.

Constitution of Kenya, 2010

The Constitution, the supreme law of the land, is the place to begin. Article 41 of the Constitution provides for labor relations. Article 41(1) outlines that everyone has the right to fair labor practices, which essentially means that both the employer and the employee should fairly treat each other in all their dealings. Article 41(2) provides for other rights such as fair remuneration, reasonable working conditions, forming, joining, participating in trade union programs, and going on strike.

The fact that there is a Pandemic does not suspend constitutional rights.

The fact that there is a Pandemic does not suspend the above rights. Employers should ensure that they remunerate their employees fairly considering the circumstances and that their working conditions are safe, enforcing the 2-meter social distancing rule. Even if the pandemic forces the employer to lay off his/her employees or carry out redundancies, it should be in line with the law. Their employee can sue any employer who unduly violates these rights even amid the current health crisis for violation of their rights. In the case of Kenya Hotels & Allied Workers’ Union v Travellers Beach Hotel [2006] eKLR Justice Chemmutut pointed out that even amidst world war 11, employers in Britain could not take advantage of the crisis and undermine employee trade unions. Therefore, this case shows that employees’ rights are not to be threatened, regardless of the situation.

Employment Act, 2007

The Employment Act contains most of the provisions relating to labor relations and labor rights. Regarding layoffs and redundancies, the Act under Section 35 requires the employer to issue a termination notice before laying off any employees. Employers should issue the notification in line with the time when salaries and wages are payable. In Kenya, most employees are paid monthly; therefore, the notice should be issued one month before the employee’s contract is terminated. Employees who receive a one-month termination notice are also entitled to service pay for work every year, the terms of which shall be fixed. Most employees do not usually know of the service pay; hence they end up being disenfranchised. The employer can alternatively terminate the contract by paying the employee’s salary in place of the termination notice. An employer can pay the employee’s one-month salary (which is the money he/she could have earned) instead of issuing the notice. Also, when the employee issues the termination notice and the employer waives the same, the employer is required to pay the employee remuneration equivalent to the notice not served.

All the above provisions are meant to protect the employee and ensure that they do not lose out on any money owed to them. The employee can sue any employer who terminates a contract without notice for summary dismissal under Section 44.

Regarding redundancies, Section 40 provides for compulsory provisions that parties must follow.

When certain circumstances render an employee’s services superfluous without it being the fault of the employee, redundancies occur

When certain circumstances render an employee’s services superfluous without it being the fault of the employee, redundancies occur. For example, since most offices are staying closed, most of the cleaners have been declared redundant, and employers have had to terminate their contracts. During the pandemic, several employers have reported their employees as redundant; unfortunately, many employees are not aware of their rights during redundancy. Section 40 provides for the conditions that parties must follow. They include issuing a one-month notice to the employee’s trade union and the labor officer of the place where the employee is employed. If the employee is not in any trade union, the employer will issue the notice to the employee personally and the labor officer. The employer should also consider seniority, skills, ability, and reliability before terminating any service contract on account of redundancy. The employer should also not put an employee in a disadvantageous position because they are a member of a trade union which has a collective agreement setting out terminal benefits payable upon redundancy. The employer should also pay the employee for leave, as well as severance pay at the rate of not less than fifteen days, pay for each completed year of service. The Employment Act contains numerous provisions that protect employees, which is a huge positive.

Labour Institutions Act, 2007

The Act under Part V provides for labor administration and inspection, which establishes offices of the Commissioner of Labor, Director of Employment, and other officers who ensure that employers comply with all the labor laws. Employees can issue complaints of summary dismissal and unfair termination against the employer to the labor officers per Section 47 of the Employment Act.

Labour Relations Act, 2007

This Act provides for the establishment of trade unions, which play a crucial role in promoting the rights of workers. The Act also encourages collective bargaining, which works towards reducing industrial action and strikes. Employees are encouraged to register with trade unions for better protection of their rights.

In conclusion, employees must know their rights, especially during these times. Employers should desist from depriving their employees of their rights and strive to ensure that their employees are satisfied.

*Cover image credits: reed.com

About the Author

Stanley Gathaga is a law student currently undertaking pupillage at Matemu Katasi & Co. Advocates. He has a soft spot for Intellectual Property, Constitutional Law, and Employment law.

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Stephanie Mulului will be writing about how counterfeiting affects the demand and supply of goods. She will explore the concept of counterfeiting and how high demand for products and low supply leads to the creation of Kenya as a counterfeit hot-spot. Stay tuned.

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