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Case Brief · caselaw.co.ke
ELRCPartially AllowedCause No 30 of 2016· [2018] KEELRC 2253 (KLR)

Abdulrahman Omar v Kenya Red Cross [2018] KEELRC 2253 (KLR)

Employment and Labour Relations Court
20 March 2018
2,109 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 that refusing to renew an injured worker's contract was unfair dismissal, awarding him 12 months' salary.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent NGO as a driver from around 2008 under successive fixed term contracts, suffered a serious back injury on 3rd April 2012 while on duty. His doctor recommended light duty, but the Respondent continued assigning heavy duties and ultimately notified him in November 2013 that his contract, expiring 31st December 2013, would not be renewed. The Claimant sued for 12 months' salary as compensation for unfair termination, severance pay, costs and interest. The Respondent maintained that the Claimant served on donor-funded fixed term contracts, renewal depended on donor funds, and it had no obligation to renew after expiry. The Court applied the principle from Ruth Gathoni Ngotho-Karuiki and the UNAT decision in Frenchon that an employer's discretion not to renew may be challenged where based on improper motive. It found no evidence that renewal was pegged to donor funding or a specific project, the contract having been renewed without fail since 2008, and UNHCR operations at Dadaab continuing. The Court concluded the only reason for non-renewal was the Claimant's injury and diminished productivity, making non-renewal a separation initiated by the employer and unfair termination. The Claimant was awarded the equivalent of 12 months' salary at Kshs. 480,000, with costs and interest at 14% per annum. The severance pay claim failed because severance applies only in redundancy under Section 40 of the Employment Act, and the Claimant, as an N.S.S.F. contributor, was ineligible for service pay under Section 35(6).

Key legal issues

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01

Whether non-renewal of a fixed term contract was unfair termination

Holding

The non-renewal was in substance a termination initiated by the employer, based on the improper motive of the Claimant's work injury and diminished productivity, and was therefore unfair.

Reasoning

The contract had been renewed without fail from 2008. The Respondent did not prove that renewal depended on donor funding or that any project or UNHCR funding ended. The employer could not offer light duty or transfer without a pay cut, and the only plausible reason for non-renewal was the Claimant's impairment through work injury. Following the Frenchon UNAT decision, non-renewal on such grounds is separation initiated by the employer and unfair.

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02

Whether severance or service pay was payable

Holding

Severance pay is only available in redundancy under Section 40 of the Employment Act, and the Claimant was ineligible for service pay under Section 35(6) because he contributed to the N.S.S.F.

Reasoning

The Claimant's position was never declared redundant, so Section 40 severance pay does not arise. If the claim were read as service pay, Section 35(6) excludes employees who are active N.S.S.F. contributors, as the pay slip showed. The claim for Kshs. 140,000 was therefore refused.

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Legal principles established

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  • An employer's discretion not to renew a fixed term contract can be challenged where the decision is based on improper motive, including where non-renewal is a response to service-incurred injury
  • Non-renewal of a fixed term contract informed by the employee's work injury and diminished productivity constitutes termination by the employer and is unfair

Court orders

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  1. 1.Declaration that the Claimant's contract of employment was terminated unfairly
  2. 2.Respondent to pay the Claimant the equivalent of 12 months' salary in compensation for unfair termination at Kshs. 480,000
  3. 3.Costs to the Claimant
  4. 4.Interest at 14% per annum from the date of Judgment till payment in full

Authorities

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Legislation

  • Employment ActSection 40
  • Employment Act 2007Section 35(6)

Cases cited (4)

  • Benard Wanjohi Muriuki v. Kirinyaga Water & Sanitation Company & Another
    [2012] e-KLR
  • Margaret A. Ochieng’ v. National Water & Pipeline Corporation
    [2014] e-KLR
  • Ruth Gathoni Ngotho – Karuiki v. Presbytery Church of East Africa & Another
    [2012] e-KLR
  • Frenchon v. the Secretary-General of the United Nations
    UNAT Case No. 2010 – 125
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over unfair termination claims (Employment Act 2007)

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, "Abdulrahman Omar v Kenya Red Cross [2018] KEELRC 2253 (KLR)", Case Analysis (2018). Cause No 30 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/2253/eng@2018-03-20

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