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ELRCDismissedCause No 1845 of 2014 (lead file, consolidated claim)· [2018] KEELRC 2523 (KLR)

Michael Kareri Mwangi & 3 others v Apex Steel Limited [2018] KEELRC 2523 (KLR)

Employment and Labour Relations Court
19 January 2018
LNLinnet NdoloMOMaureen Onyango
1,417 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~6 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ruled that a fixed term contract ends automatically on its expiry date, and employees cannot claim unfair termination when it simply runs out.

What this practically means

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Executive summary

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Four Claimants sued Apex Steel Limited in consolidated claims for unlawful and unfair termination of employment following the end of their employment on 2nd January 2014, each claiming one month's salary in lieu of notice, house allowance, severance pay, leave pay and twelve months' salary as compensation. The Respondent denied that any termination occurred, averring that the Claimants served on successive fixed term contracts which lapsed on 30th November 2013 by effluxion of time, that they were paid all dues including gratuity and executed releases, that their salary was consolidated with a housing element, that they were never declared redundant, and that they had no outstanding leave balances. The court framed two issues: whether the Claimants made out a claim for unlawful termination, and whether they were entitled to the remedies sought. Adopting the definition of a fixed term contract in Samuel Chacha Mwita v KEMRI and Margaret A. Ochieng v National Water Conservation & Pipeline Corporation, the court held that fixed term contracts terminate automatically on expiry without constituting a dismissal and carry no expectation of renewal. The 2nd Claimant's contention that working a few days in December 2013 evidenced renewal was rejected, the court accepting the Respondent's explanation regarding December work during annual factory maintenance under a separate arrangement. The court found no intention of renewal beyond 30th November 2013 and held that employment ended by effluxion of time, defeating the claims for compensation and notice. House allowance failed as the salary was consolidated; severance failed absent redundancy; and leave pay failed as records showed leave days were paid under each contract. The entire claim was dismissed with each party bearing their own costs.

Key legal issues

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01

Whether the Claimants were unlawfully and unfairly terminated

Holding

No; their employment ended by effluxion of time upon expiry of successive fixed term contracts on 30th November 2013, with no intention of renewal

Reasoning

It was not in contest that the Claimants served on successive fixed term contracts up to 30th November 2013. The court adopted the definition of a fixed term contract in Samuel Chacha Mwita v KEMRI and the holding in Margaret A. Ochieng v National Water Conservation & Pipeline Corporation that fixed term contracts carry no expectation of renewal. The 2nd Claimant's claim that working a few days in December 2013 amounted to renewal was rejected; the Human Resource Manager explained December work was paid separately during annual factory maintenance. Consequently no claim for unlawful termination could lie.

p. 4
02

Whether the Claimants were entitled to notice pay, house allowance, severance pay, leave pay and compensation

Holding

None of the heads was merited: notice and compensation fell away for want of termination; house allowance failed as salary was consolidated; severance failed as there was no redundancy; leave pay failed as leave was paid under each contract

Reasoning

The remedies claims were derivative of the termination claim and fell with it. On house allowance, the documents showed a consolidated salary inclusive of a housing element. Severance pay presupposes redundancy, which was not the case here. The Respondent produced records showing payment for leave days earned under each contract, and the Claimants had also executed acknowledgements, releases and discharges upon receiving their dues.

p. 4

Legal principles established

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  • A fixed term contract terminates automatically on its expiry date and such termination does not constitute a dismissal, as the proximate cause is not an act of the employer
  • Fixed term contracts do not generally carry an expectation of renewal

Court orders

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  1. 1.The Claimants' entire claim is dismissed
  2. 2.Each party to bear their own costs

Authorities

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Cases cited (2)

  • Samuel Chacha Mwita v Kenya Medical Research Institute
    [2014] eKLR
  • Margaret A. Ochieng v National Water Conservation & Pipeline Corporation
    [2014] eKLR
Jurisdiction invoked
Original employment and labour relations jurisdiction of 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, "Michael Kareri Mwangi & 3 others v Apex Steel Limited [2018] KEELRC 2523 (KLR)", Case Analysis (2018). Cause No 1845 of 2014 (lead file, consolidated claim). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/2523/eng@2018-01-19

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