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Court of AppealDismissedCivil Appeal 53 of 2018· [2022] KECA 1235 (KLR)

Mungai v Kabuito Contractors Limited

Court of Appeal
4 November 2022
DMD K MusingaHOH A OmondiKLK I Laibuta
1,620 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Court of Appeal confirmed that workers on short, project-based contracts are not permanent employees, so ending their contracts when a project finishes is lawful.

What this practically means

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Executive summary

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The appellant, Daniel Mungai, was engaged by Kabuito Contractors Limited as a roller operator from May 2006 at a daily rate, working intermittently as and when the road contractor secured construction contracts. His engagement ended on May 28, 2011 when the respondent's road project concluded. After a labour office computed his terminal dues at KShs 17,791, he sued in the Employment and Labour Relations Court, which awarded him KShs 30,900 comprising one month's salary in lieu of notice, leave allowance and pay for public holidays worked, plus a certificate of service and costs. Aggrieved, he appealed to the Court of Appeal seeking 12 months' wages as compensation for wrongful and unfair dismissal. The Court, comprising Musinga, Omondi and Laibuta, JJA, framed four issues: the nature of the employment, whether termination was wrongful or unfair, entitlement to relief, and the appropriate orders. It held that the appellant was neither a casual nor a permanent employee but was engaged on short-term contracts tied to the duration of each construction contract. Termination at the end of a contract fell within section 45(2)(b)(ii) of the Employment Act as based on the employer's operational requirements, and was neither wrongful nor unfair. Section 45(3) additionally barred the claim since the last engagement lasted only 10 months. The Court found nothing to fault in the trial court's awards and dismissed the appeal with no orders as to costs, upholding the ELRC judgment.

Key legal issues

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01

Status of employment - permanent, casual or contract

Holding

The appellant was neither a casual employee nor a permanent employee; he was employed on short-term contracts for the duration of each road construction contract.

Reasoning

Wages were computed at daily rates and engagement was conditional on the respondent securing a road construction contract. The evidence did not establish casual employment under section 2 of the Employment Act, nor permanent employment. Engagement was terminable at the end of each contract unless re-engaged under a new one.

p. 3
02

Whether termination was wrongful or unfair

Holding

Termination at the end of the contract was in accordance with section 45(2)(b)(ii) of the Employment Act, being based on the operational requirements of the employer, and was neither wrongful nor unfair.

Reasoning

The appellant's engagement was tied to a particular road construction contract; when that project ended, termination fell within the operational requirements contemplated by section 45(2)(b)(ii). Further, section 45(3) bars unfair dismissal claims for employees continuously employed for 13 months or less, and the last engagement was 10 months.

p. 3
03

Entitlement to relief

Holding

The claims for compensation for unfair dismissal and terminal dues fail; the trial court's awards of notice pay, leave allowance and public holiday pay were unimpeachable.

Reasoning

Section 45(3) bars claims for employees with 13 months or less continuous employment. Having found no fault with the trial court's award of KShs 18,000 in lieu of notice, KShs 8,100 leave allowance and KShs 4,800 for public holidays, the Court found nothing to fault in the decision below.

Legal principles established

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  • On a first appeal the Court of Appeal must analyze and re-assess the evidence and reach its own conclusions, while making allowance for not having seen or heard the witnesses.
  • An employee engaged intermittently on short-term contracts tied to the duration of a specific project is not a permanent employee, and termination at the end of the contract is based on operational requirements under section 45(2)(b)(ii) of the Employment Act.

Court orders

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  1. 1.Appeal dismissed with no orders as to costs
  2. 2.Judgment of the Employment and Labour Relations Court (MN Nduma, J) upheld

Authorities

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Legislation

  • Employment Actsection 2
  • Employment Actsection 37
  • Employment Actsection 40
  • Employment Actsections 41, 43 and 45
  • Employment Actsection 45(2)(b)(ii)
  • Employment Actsection 45(3)
  • Regulation of Wages (General Amendment) Order2011

Cases cited (2)

  • Arthi Highway Developers Limited v West End Butchery Limited and 6 others
    [2015] eKLR

    First appellate court's duty to re-assess evidence and reach its own conclusions

  • Selle v Associated Motor Boat Co
    [1968] EA p 123

    Appeal by way of retrial; appellate court not bound by trial judge's findings of fact where evidence was misappreciated

On appeal from
Employment and Labour Relations Court of Kenya at Nairobi
E.L.R.C Cause No. 1990 of 2011
Jurisdiction invoked
First appeal to the Court of Appeal from the Employment and Labour Relations Court

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Mungai v Kabuito Contractors Limited", Case Analysis (2022). Civil Appeal 53 of 2018. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2022/1235/eng@2022-11-04

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.