Marketforce Technologies has been ordered to pay KES 2.1 million to a former employee for wrongful termination.
Tom Maina Chege, a former product manager who worked at Marketforce from January 2022 to August 2023, filed the case in October 2023. Chege, whose monthly gross salary was KES 200,000 ($1,550), was laid off in July 2023, with his termination taking effect in August.
Chege argued that the redundancy was unlawful, as “the notice period of 30 days did not lapse before the redundancy took effect”. Also, Marketforce failed to notify the Labour Office, a requirement under Section 40 of the Employment Act, 2007.
Chege sought KES 1,560,870 in compensation for unpaid leave, notice pay, severance pay, salary arrears, and general damages, according to court documents seen by TechCabal.
After Marketforce failed to defend the suit, Judge C.N. Baari ruled that the redundancy was procedurally and substantively unfair. The court awarded Chege KES 1,316,547 in terminal dues and KES 800,000 in compensation and legal costs.
“[Marketforce] did not attempt to comply with the seven steps set out in Section 40(1) of the Employment Act, 2007,” the ruling stated.
The judgment sheds light on Marketforce’s internal troubles, which three former employees say began with mass staff exits in late 2022 and 2023. The company lost key employees, which affected operations and strained relationships with major distributors.
At the same time, Marketforce faced severe cash flow problems, resulting in salary delays and pay cuts of up to 50% for non-tech employees. Despite raising over $40 million from investors such as Reflect Ventures, Greenhouse Capital, and Century Oak Capital, the company’s abrupt exit from the B2B e-commerce space in 2024 left its current status unclear.
While the startup’s fate hangs in the balance, co-founder Tesh Mbaabu has shifted his focus to Chpter, a platform helping businesses sell via social media.
In September 2024, Chpter closed a $1.2 million pre-seed round led by Pani, an Africa-focused investment firm co-founded by former Cellulant CEO Ken Njoroge. The company is also part of the Safaricom Spark and Norrsken Accelerators.