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ELRCDismissedNot stated in judgment

Owade v Jesuit Refugee Service – Eastern Africa Region (Cause 16 of 2019) [2023] KEELRC 1048 (KLR)

Employment and Labour Relations Court
28 April 2023
1,420 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court confirmed that letting a fixed term contract expire is not unfair termination, unless the contract itself promises renewal.

What this practically means

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Executive summary

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The Claimant, employed as a Counselling Coordinator in Kakuma on a three-month fixed term contract running from January 7, 2019 to April 7, 2019 at a gross monthly salary of Kshs 86,000, sued alleging that his termination on April 10, 2019 was unfair, unprocedural and unlawful, based on an undisclosed and incomplete appraisal report, and in breach of the employment contract. He contended that the project and department he worked under remained fully funded and that he had never breached his contract or the Code of Conduct. The Respondent denied the claim, asserting that the contract was fixed term, automatically lapsed on April 7, 2019 by effluxion of time, and that renewal was at its discretion, clause 3.1 providing that the contract could be renewed by agreement or simply terminated. It relied on non-availability of funds and the Claimant's poor appraisal (delayed reports and lack of teamwork) as reasons for non-renewal, communicated by email of April 10, 2019. The Respondent's witness conceded she joined the organisation after the Claimant left and lacked minutes of the contract review and financial statements showing lack of funds. The court held that fixed term contracts carry no guarantee of renewal unless the contract provides otherwise or the parties agree, that such contracts typically concern projects or seasonal employment, and that the Respondent lawfully exercised its contractual option of non-renewal. The claim of unfair termination was found unfounded and the suit was dismissed with costs on April 28, 2023.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the Claimant's employment was unfairly, unprocedurally and unlawfully terminated on April 10, 2019
  2. 2.Whether a fixed term contract that lapses by effluxion of time and is not renewed constitutes unfair termination
  3. 3.Whether the Claimant had a legitimate expectation of renewal of the contract

Key legal issues

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01

Whether non-renewal of a fixed term contract amounts to unfair termination

Holding

No - the three-month fixed term contract expired and the Respondent lawfully exercised its contractual option not to renew

Reasoning

The contract ran from January 7, 2019 to April 7, 2019 and clause 3.1 provided that ten days before expiry it would be reviewed, and subject to availability of funds and performance, could be renewed by agreement or simply terminated. The court held that fixed term contracts, usually tied to projects or seasonal work, carry no guarantee of renewal unless the contract provides otherwise or the parties agree. The Respondent's decision not to renew, communicated by email of April 10, 2019, was an exercise of an option the contract expressly allowed.

p. 4
02

Whether the Claimant had a legitimate expectation of continued employment

Holding

No - a fixed term employee cannot presume continuity of employment absent non-renewal

Reasoning

The Respondent pleaded that renewal was at its discretion and that the Claimant could not presume a legitimate expectation of continuity in the absence of renewal. The Claimant admitted in cross-examination that he did not apply for renewal of his contract. The court's reasoning on the nature of fixed term contracts rejected any presumption of renewal, aligning with the Respondent's position that the contract automatically lapsed on April 7, 2019 by effluxion of time.

p. 2

Legal principles established

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  • Unless a fixed term contract provides to the contrary or the parties mutually agree, there is no guarantee that a fixed term contract will be renewed upon expiry
  • An employer may not be faulted for exercising a contractual option of termination by non-renewal of a fixed term contract

Court orders

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  1. 1.The suit is dismissed with costs
  2. 2.It is so ordered

The bench

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One judgment of the whole court — no separate or dissenting opinions.

Wrote the judgment

Jurisdiction invoked
Employment and labour relations jurisdiction (memorandum of claim under the Employment Act regime); no specific constitutional/statutory article cited

Relief refused

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Claim for unfair, unprocedural and unlawful termination of employment

The Claimant was on a three-month fixed term contract which clause 3.1 allowed to be renewed or simply terminated; the Respondent lawfully exercised the option of non-renewal

p. 4

Costs

The suit is dismissed with costs (costs to the Respondent)

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

unless the contract provides to the contrary or the parties mutually agree, there is no guarantee that a fixed term contract will be renewed upon expiry
p. 3No guarantee of renewal of fixed term contracts
The Respondent opted to exercise its option of terminating the contract by nonrenewal. It could therefore not be faulted for exercising an option which the contract allowed.
p. 4Contractual option of non-renewal lawfully exercised
In conclusion, the Court finds and holds that the allegations of unfair termination of contract are unfounded and without merit. The suit is therefore dismissed with costs.
p. 4Final orders - dismissal with costs
most of fixed term contracts concern projects or seasonal employment which make it unsustainable to retain the relationship beyond a season or upon expiry or conclusion of a project
p. 3Rationale for the fixed term contract doctrine

Issues in the judgment

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minor

Date of filing of the memorandum of claim appears as '2nd My, 2019', an apparent typographical error for May 2019

minor

The Claimant's testimony that he left employment in March 2019 conflicts with his pleadings and the Respondent's case that the contract lapsed April 7, 2019 and was communicated by email dated April 10, 2019

minor

The judgment does not state the case number, the names of the parties, or the specific statutory provisions relied upon

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, "Owade v Jesuit Refugee Service – Eastern Africa Region (Cause 16 of 2019) [2023] KEELRC 1048 (KLR)", Case Analysis (2023). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/1048/eng@2023-04-28

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