Enos Otieno Auch v East African Portland Cement Company Limited [2019] KEELRC 2024 (KLR)
The bottom line
#A Kenyan court ruled employers can refuse to renew a fixed-term contract, but cannot end one early without telling the employee why and hearing their side.
What this practically means
#Executive summary
#Key legal issues
#Whether non-renewal of the fixed-term contract violated due process
Non-renewal was a valid exercise of the employer's prerogative and did not require reasons
The contract provided for renewal only on agreed terms. The Petitioner complied with the application requirement, but the Respondent was entitled to decline renewal based on its needs. Legitimate expectation to renewal was therefore not made out, and the Respondent could not be faulted for the decision not to renew.
Whether early termination of the contract was based on valid reasons and due process
The early termination was unfair and unjustified
The Respondent terminated the contract 3½ months before expiry on the strength of a forensic audit report never supplied to the Petitioner. He was not invited before the Board, not given the minutes, not informed of the reasons, and had no chance to be heard, contrary to section 41 of the Employment Act and Articles 47 and 50 of the Constitution and the Fair Administrative Action Act.
Whether remedies were due notwithstanding settlement of the earlier claim
Yes; settlement of the wages claim did not cure the unfairness
The consent in Claim 1228/2017 resulted in payment of the balance of the contract period, but that did not compensate the Petitioner for the unfairness of the early termination. The court awarded 4 months' salary, one month's salary in lieu of notice, and KShs. 2 million for breach of constitutional rights.
Legal principles established
#- Termination of a fixed-term contract before its expiry without reasons and without a hearing offends section 41 of the Employment Act and Article 47 of the Constitution
- An employee terminated early without being informed of reasons or given an opportunity to be heard is condemned unheard, and his constitutional and statutory rights are breached
- An employer is not obliged to renew a fixed-term contract; renewal depends on mutual agreement
Court orders
#- 1.Compensation of 4 months' salary for unfair termination (4 x 513,962.50 = KShs. 2,055,850.00)
- 2.One month's salary in lieu of notice (KShs. 512,962.50)
- 3.Damages of KShs. 2,000,000.00 for breach of constitutional rights
- 4.Total award of KShs. 4,569,812.50 subject to statutory deductions
- Jurisdiction invoked
- Section 12 of the Industrial Court Act; Article 162(2) of the Constitution (jurisdiction to enforce fundamental rights in employment disputes as argued by the Petitioner citing United States International University vs Attorney General)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Enos Otieno Auch v East African Portland Cement Company Limited [2019] KEELRC 2024 (KLR)", Case Analysis (2019). Petition arising out of Employment Claim; consolidated with ELRC Cause 1228 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/2024/eng@2019-03-06
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.