Technical University of Kenya (Formerly The Kenya Polytechnic University College) v Odeck (Civil Appeal 443 of 2018) [2024] KECA 525 (KLR)
The bottom line
#Kenya's Court of Appeal confirmed employees become permanent if kept on probation past six months, but capped compensation at twelve months' wages, not the full contract term.
What this practically means
#Executive summary
#Key legal issues
#Whether the Respondent's employment was constructively confirmed by operation of law upon expiry of the initial six-month probationary period without express extension, confirmation or termination
Yes. The six-month probationary period lapsed on 14th October 2011; the Employment Act caps probation at six months extendable only by agreement of the employee for a further six months, and prohibits probation beyond twelve months in aggregate. The letter of 18th April 2012 could not constitute an implied extension, and the employer's inaction could not be visited upon the employee.
Section 42(2) and (3) of the Employment Act are mandatory: probation may not exceed six months, extension requires the employee's agreement, and aggregate probation may not exceed twelve months. The Appellant did not extend or waive probation in October 2011 and relied only on its internal transitional challenges a year later. The Terms of Service required confirmation upon successful completion of probation. The trial Judge's findings to this effect were sound and were upheld.
Whether the termination of the Respondent's employment was unfair and in breach of contract
Yes. Once employment was constructively confirmed, termination had to follow Clause 12 of the Terms of Service and section 45 of the Employment Act; Clause 11 applied only to resignation by a confirmed employee, and the summary termination without notice, warnings, interdiction, suspension or a full disciplinary hearing was unfair.
Having found constructive confirmation, the Court held that Clause 9.2.1 (probationary termination on three months' notice or pay in lieu) was inapplicable. Clause 11 governs termination after confirmation by resignation only. The safeguards in Clause 12 (warnings, interdiction, suspension, disciplinary procedure) and section 45 of the Employment Act were not observed, so the procedure breached the contract and was unfair. The trial Judge did not err in these findings.
Whether the award of salary and allowances for the unexpired 26 months of the 3-year contract was lawful
No. The correct statutory measure under section 49 of the Employment Act is notice pay, proportionate wages and compensation not exceeding twelve months' gross wages; an award of the full unexpired residue of a fixed-term contract has no basis in statute or common law and was set aside.
Section 49(1)(a) codifies the common law measure of damages for breach of an employment contract: wages and benefits that would have been earned had due notice been given. Section 49(1)(c) provides relief for consequential loss capped at twelve months' gross wages. Since the employer had already paid three months' pay in lieu of notice, the Court considered six months' gross pay and allowances reasonable compensation and substituted that figure for the trial award.
Whether allowances form part of wages for the purposes of compensation on termination
Yes. Allowances constitute part of the consideration for services rendered and fall within the statutory definition of remuneration and the ordinary meaning of wages, and must be included in computing dues and compensation on termination.
The Court noted that the Employment Act defines remuneration as the total value of all payments in money or in kind arising from employment, and section 49(1) refers to salary and wages. Relying on Black's Law Dictionary, wages encompass every form of remuneration payable for personal services, including salaries and similar advantages. Sections 17(3) and 40 of the Employment Act specifically contemplate allowances in payment of dues, so allowances were included in the substituted six-month award.
Legal principles established
#- A probationary period shall not exceed six months, and may only be extended for a further period of not more than six months with the agreement of the employee; an employee cannot be kept on probation for more than twelve months in aggregate, after which employment is constructively and automatically confirmed
- Where an employer fails to communicate the status of employment before the end of the probationary period, the employer is estopped from alleging that the probation period still subsists
- Allowances constitute part of the consideration for services rendered by an employee and fall within the definition of wages; they must be included in computing dues and compensation payable on termination
- The normal measure of damages for breach of a contract of employment is the wages and benefits the employee would have earned had due notice been given; compensation under section 49(1)(c) is capped at twelve months' gross wages and does not extend to the unexpired residue of a fixed-term contract
- A first appellate court will not depart from the findings of the trial court unless they are not based on evidence on record, the court acted on wrong principles of law, or its discretion was exercised injudiciously
Court orders
#- 1.The appeal is partially allowed, only to the extent of setting aside the order awarding the Respondent salary and allowances for the remainder of the 26 months of his 3-year contract (Kshs 8,734,600/-)
- 2.Substitution of the said order with an order awarding the Respondent a total sum of Kshs 2,032,400/= as compensation, being his gross wages for 6 months (salary Kshs 1,296,600; responsibility allowance Kshs 78,000; leave travelling allowance Kshs 6,000; passage and baggage allowance Kshs 9,000; car allowance Kshs 108,000; entertainment allowance Kshs 54,000; housing allowance Kshs 390,000; utility allowance Kshs 64,800; furniture allowance Kshs 26,000)
- 3.No order as to the costs of the appeal
- On appeal from
- Employment and Labour Relations Court at Nairobi
- ELRC Cause No. 604 of 2014
- Jurisdiction invoked
- First appellate jurisdiction over the Employment and Labour Relations Court (the judgment does not state the specific constitutional/statutory provision; appeal as of right on facts and law)
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (1)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Kwale International Sugar Company Ltd v Mbaya (Civil Appeal E059 of 2022) [2024] KECA 795 (KLR)[2024] KECA 795 (KLR)12 Jul 2024applied
Cite this brief
#Cite this brief
Caselaw, "Technical University of Kenya (Formerly The Kenya Polytechnic University College) v Odeck (Civil Appeal 443 of 2018) [2024] KECA 525 (KLR)", Case Analysis (2024). Court of Appeal Civil Appeal (not numbered in judgment; arising from ELRC Cause No. 604 of 2014). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2024/525/eng@2024-05-09
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.