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ELRCPartially AllowedCause No 998 of 2016· [2022] KEELRC 937 (KLR)

Dennis Asenji v Standard Group Limited [2022] KEELRC 937 (KLR)

Employment and Labour Relations Court
2 February 2022
MOMaureen Onyango
2,477 words in judgment
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The bottom line

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Kenya's Employment Court ruled that even fixed-term contracts cannot be ended without a valid reason and a fair hearing, awarding the employee eight months' salary.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent on 29 November 2011 as Manager – Broadcast Creative on a four-year fixed term contract, sued after his employment was terminated on 12 July 2013 without reasons or a hearing. He sought a declaration of unfair dismissal, reinstatement, salary arrears for the unexpired contract term, special damages, and maximum compensation of 12 months' salary. The Respondent admitted the employment and termination but maintained that under the contract's termination clause it was not obliged to give reasons, and that notice pay and terminal dues were paid. The Respondent closed its case without calling any witness and filed no submissions. The court framed two issues: the validity of the termination procedurally and substantively, and entitlement to reliefs. Relying on Sections 41, 43 and 45 of the Employment Act, the court held that fixed term contracts attract the same statutory requirements and found no valid reason was given and no hearing accorded, rendering the termination both substantively and procedurally unfair. On remedies, the court declared the dismissal unfair and awarded 8 months' salary (Kshs.3,117,512) as compensation under Section 49, considering length of service and the Respondent's non-participation. Reinstatement was refused as time-barred under Section 12(3)(vii) of the ELRC Act, and salary arrears for the unexpired term were refused as unjust enrichment, following Elizabeth Wakanyi Kibe and D.K. Njagi Marete. Costs and interest from judgment were awarded to the Claimant. Judgment was delivered virtually at Nairobi on 2 February 2022.

Key legal issues

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01

Whether the termination was substantively valid

Holding

No valid reason was given for the termination; the employer relied only on the contractual termination clause

Reasoning

The termination letter invoked only the contract's termination clause permitting termination with notice or pay in lieu. Section 43 of the Employment Act applies equally to fixed term contracts and requires a valid reason. The Respondent pleaded it was not obliged to give reasons, but the court held this did not exempt it from the statutory requirement.

p. 4
02

Whether the termination was procedurally fair

Holding

Section 41 procedure was not followed as the Claimant was not accorded a hearing

Reasoning

The Claimant testified, and the Respondent's defence confirmed, that no disciplinary hearing was conducted; the Respondent simply exercised its contractual right to terminate. Section 41's mandatory procedure applies and was not followed, rendering the termination procedurally unfair.

p. 4
03

What remedies flow from the unfair termination

Holding

Declaration of unfair termination plus 8 months' salary as compensation; reinstatement and salary arrears refused

Reasoning

Considering length of service (about one and a half years), the manner of termination, and the Respondent's failure to call any witness or file submissions, 8 months' salary was reasonable compensation under Section 49. Remuneration for the unexpired contract term was refused as unjust enrichment, and reinstatement was time-barred.

p. 5

Legal principles established

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  • Fixed term contracts are subject to Sections 41 and 43 of the Employment Act like any other employment contract unless the contract has lapsed
  • For a termination to pass the fairness test there must be both substantive justification and procedural fairness
  • An employee is not entitled to remuneration for the unexpired period of a terminated fixed term contract as that would amount to unjust enrichment

Court orders

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  1. 1.A declaration that the Claimant's termination was unfair and unlawful
  2. 2.Eight (8) months' compensation for unfair termination in the sum of Kshs.3,117,512.00
  3. 3.Costs of the suit to the Claimant
  4. 4.Interest from the date of judgment until settlement in full

Authorities

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Legislation

  • Employment Act, 2007Sections 41, 43, 45, 45(2), 49, 49(4)
  • Fair Administrative Action ActSection 4
  • Constitution of Kenya, 2010Articles 47, 48, 159(2)(d)
  • Employment and Labour Relations Court ActSection 12(3)(vii)
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B

Cases cited (6)

  • Idris Omar Abdi v Garissa Water and Sewerage Company Limited
    (2021) eKLR
  • Onesmus Mbithi Muia v David Engineering Limited
    (2021) eKLR
  • Jacob Omondi Guma v East African Portland Cement; Japheth Ombogo (Interested Party)
    (2020) eKLR
  • Walter Ogal Anuro v Teachers Service Commission
    (2013) eKLR
  • Elizabeth Wakanyi Kibe v Telkom Kenya Limited
    [2014] eKLR
  • D.K. Njagi Marete v Teachers Service Commission
    [2013] eKLR
Jurisdiction invoked
Employment and Labour Relations Court Act; Employment Act, 2007

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, "Dennis Asenji v Standard Group Limited [2022] KEELRC 937 (KLR)", Case Analysis (2022). Cause No 998 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/937/eng@2022-02-02

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