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ELRCPartially AllowedCause No. 2248 of 2014· [2016] KEELRC 964 (KLR)

James O Oloo v Tana and Athi River Development Authority [2016] KEELRC 964 (KLR)

Employment and Labour Relations Court of Kenya
11 July 2016
3,259 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court ruled an employee whose six-month probation lapsed without confirmation was a full employee, and his dismissal without a hearing earned him over Kshs 1.2 million.

What this practically means

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Executive summary

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The Claimant, employed as Chief Manager Finance and Accounts from 1st November 2011 on a six-month probationary term, was dismissed with effect from 29th June 2012 by letter citing non-confirmation and gross misconduct (altered bank signatories and irregular withdrawals) and failure to prepare board papers. He sued for declarations of wrongful termination, reinstatement, unpaid salaries, allowances, notice pay, severance, costs and interest. The Respondent raised a preliminary objection that under Section 42 of the Employment Act a probationary employee has no unfair termination cause of action, and argued the dismissal was justified. The court framed four issues: probation status, validity of reasons, due process, and remedies. It held the six-month probation expired on 30th April 2012 and was never validly extended with the Claimant's agreement as Section 42(2) requires; the dismissal letter was therefore a disguised dismissal of a confirmed employee. It further found that Section 41 hearing requirements were breached, making the termination unfair and unjustified. However, because the Claimant had served only eight months, below the thirteen-month threshold in Section 45(3), he could not complain of unfair termination. Reinstatement was refused as impracticable after three years. The court awarded one month's salary in lieu of notice (Kshs 165,432), pro-rata leave of Kshs 110,288, six months' salary as compensation for breach of contract (Kshs 992,592), totalling Kshs 1,268,312, a Certificate of Service, and costs of the suit. The claim thus partially succeeded.

Key legal issues

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01

Whether the Claimant was still on probation when dismissed

Holding

He was not; the six-month probation lapsed on 30th April 2012 and was never validly extended with his agreement

Reasoning

The appointment letter provided a six-month probationary period running from 1st November 2011, expiring 30th April 2012. Section 42(2) of the Employment Act caps probation at six months and permits extension only with the employee's agreement. No confirmation letter was issued and no agreed extension was communicated, so at dismissal on 29th June 2012 the Claimant was off probation and the letter of non-confirmation was a disguised dismissal.

p. 6
02

Whether due process was followed before dismissal

Holding

No; Section 41 of the Employment Act was not adhered to, rendering the termination procedurally unfair

Reasoning

The Respondent assigned reasons for non-confirmation and dismissal but never subjected the Claimant to the explanation and hearing mandated by Section 41 of the Employment Act. Section 41 would have enabled the employer to test the veracity of the misconduct allegations and allowed the Claimant to defend himself. Its breach means the fairness requirements of Section 45(2) were not met.

p. 7
03

Whether the Claimant can sustain a complaint of unfair termination

Holding

No; having served only 8 months, he fails the 13-month continuous employment threshold in Section 45(3)

Reasoning

Although the court found the termination unfair and unjustified for want of due process, Section 45(3) restricts the right to complain of unfair termination to employees with not less than thirteen months' continuous service. The Claimant served only eight months, so his statutory unfair termination claim fails, limiting his remedies to contractual entitlements.

p. 7

Legal principles established

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  • A probationary period under Section 42(2) of the Employment Act may not exceed six months and any extension requires the employee's agreement; failure to confirm or expressly extend probation means the employee is deemed off probation
  • Failure to notify an employee of confirmation or of an extension of probation does not keep the employee on probation; dismissal in such circumstances is a disguised dismissal

Court orders

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  1. 1.Payment of 1 month gross salary in lieu of notice of Kshs 165,432
  2. 2.Reinstatement declined; payment of 8 months pro-rata leave being 8/12 x 165,432 = Kshs 110,288
  3. 3.Compensation for breach of the employment contract equivalent to 6 months salary = Kshs 992,592
  4. 4.Total award of Kshs 1,268,312
  5. 5.Issuance of a Certificate of Service
  6. 6.Costs of the suit

Authorities

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Legislation

  • Employment ActSection 42
  • Employment ActSection 41
  • Employment ActSection 45
  • Employment ActSection 35
  • Employment ActSection 36
  • Employment ActSection 44
  • Constitution of KenyaArticle 27
  • Constitution of KenyaArticle 28
  • Constitution of KenyaArticle 47
  • TARDA Code of RegulationsSection 2.1.5 / 2.15
  • Public Service Disciplinary Manual2008
  • ISO9001:2008
  • Civil Service Code of Regulations2006

Cases cited (9)

  • Shankar Saklani vs. DHL Global Forwarding (K) Limited
    [2012] eKLR
  • Jane Wairimu Machira vs. Mugo Waweru and Associates
    [2012] eKLR
  • Kenya Science Research International Technical and Allied Workers Union (KSRITAWU) vs. Stanley Kinyanjui and Magnate Ventures Ltd
    Industrial Court Case No. 273 of 2010
  • Danish Jalang'o & Another vs. Amicabre Travel Services Ltd
    Cause [2014] eKLR
  • Abraham Gumba vs. Kenya Medical Supplies Authority
    [2014] eKLR
  • Clendon Lewis v Howick College Board of Trustees
    [2010] NZCA 320
  • Lawrence Onyango Oduori vs. Kenya Commercial Bank
    [2014] eKLR
  • Kenya Ports Authority versus Edward Otieno
    MSA Civil Appeal No. 120 of 1997
  • George Kangethe Kinani Versus Associated Steel Limited
    HCC No 775 of 1987
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act and Labour Relations Act (cause filed as unfair and wrongful termination)

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "James O Oloo v Tana and Athi River Development Authority [2016] KEELRC 964 (KLR)", Case Analysis (2016). Cause No. 2248 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/964/eng@2016-07-11

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