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ELRCPartially AllowedStatement of Claim dated June 23, 2021 (Employment and Labour Relations Cause)· [2023] KEELRC 1370 (KLR)

Cheruiyot v Lutheran World Federation (Employment and Labour Relations Cause E036 of 2021) [2023] KEELRC 1370 (KLR)

Employment and Labour Relations Court
31 May 2023
4,265 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~17 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled that letting a fixed-term work contract simply expire is not dismissal, but withheld allowances tied to the job still had to be paid.

What this practically means

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Executive summary

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The Claimant, engaged by the Respondent as a Finance Officer and posted to its Djibouti programme, claimed Kshs 940,152 comprising one month's salary in lieu of notice, refund of Kshs 50,000/= monthly deductions from April to December 2020, internet costs, and severance pay. His fixed-term contracts ran consecutively from 2018 to December 31, 2020. Due to Covid-19 he returned to Kenya in March 2020 and worked remotely; the Respondent thereafter stopped paying the Kshs 50,000/= field allowance. By a letter of December 7, 2020 the Respondent informed him the contract would not be renewed as the Djibouti programme was ending. The court framed four issues and held that the contract was neither terminated nor the Claimant declared redundant; it expired by effluxion of time on December 31, 2020, and the non-renewal letter was merely informative and courteous. The Claimant's legitimate expectation of renewal failed for want of proof, the burden lying on him who alleges. However, construing the contract, the court found the Kshs 50,000/= monthly allowance was salary enhancement pegged to the Djibouti duty station, payable through payroll, distinct from the USD 20 daily subsistence allowance tied to physical presence; it remained payable while the Claimant worked from Kenya. The claim for notice pay, internet costs and severance was dismissed. The court declared the employment relationship lawfully ended by effluxion of time, awarded Kshs 450,000/= in withheld allowances, denied all other claims, and awarded costs to the Claimant. Judgment delivered virtually at Nakuru on May 31, 2023 by David Nderitu, Judge.

Key legal issues

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01

Whether non-renewal of a fixed-term contract amounts to termination, redundancy or wrongful dismissal

Holding

It does not; the contract expired by effluxion of time and the letter of non-renewal was merely informative and courteous

Reasoning

The court construed the fixed-term contract: it was to run to December 31, 2020 and any extension required express written agreement. The Respondent never promised renewal; prior contracts were independent and established no pattern of automatic renewal. The Claimant knew programmes depended on donor funding. The December 7, 2020 letter was out of courtesy, not a termination notice, so no dismissal or redundancy occurred.

p. 6
02

Whether the Claimant had a legitimate expectation of contract renewal

Holding

No; any such expectation was illegitimate, misplaced and imaginary

Reasoning

Applying the principle that he who alleges legitimate expectation must prove it, the court found no conduct, practice, express or implied promise of renewal. The contracts were independent and distinct, and the Claimant was aware the Djibouti programme was winding up and depended on donor funding.

p. 6
03

Whether the Kshs 50,000/= monthly allowance was payable while the Claimant worked from Kenya during Covid-19

Holding

Yes; it was salary enhancement pegged to the Djibouti duty station, payable through payroll, unlike the USD 20 daily subsistence allowance

Reasoning

The court construed the contract clause plainly: the Kshs 50,000/= was an increment to compensate for relocation costs and inconvenience of a foreign station, processed through payroll, while the USD 20 per diem was for physical presence in Djibouti. Once the Claimant left Djibouti due to Covid-19, only the per diem ceased; the allowance remained due, totalling Kshs 450,000/= for April–December 2020.

p. 8

Legal principles established

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  • A fixed-term contract that is not determined in any other manner comes to its natural end by effluxion of time, and the employer is under no obligation to give notice of non-renewal.
  • The burden of proving legitimate expectation lies on the party alleging it.
  • A field allowance payable through payroll for a foreign duty station is pegged to the duty station, not physical presence there.

Court orders

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  1. 1.A declaration that the employer/employee relationship between the Respondent and the Claimant fairly and lawfully terminated by way of effluxion of time
  2. 2.The Claimant awarded Kshs 450,000/= in salary/allowance arrears unlawfully deducted and/or withheld
  3. 3.All other claims denied
  4. 4.Costs to the Claimant

Authorities

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Legislation

  • Employment Act, 2007Section 25(1)
  • Employment Act, 2007Section 40(1)(g)

Cases cited (4)

  • Stephen M Kitheka V Kevita International Limited
    (2018) eKLR
  • Amatsi Water Services Company Limited V Francis Shire Chachi
    (2018) eKLR
  • Jonathan Kipchoge V Sylvester Kimaiyo & 2 Others
    (2022) eKLR
  • Teresa Carol Omondi V Transparency International-Kenya
    (2017) eKLR
Jurisdiction invoked
Article 162(2) of the Constitution establishing the Employment and Labour Relations Court (employment dispute; no express provision quoted in judgment)

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, "Cheruiyot v Lutheran World Federation (Employment and Labour Relations Cause E036 of 2021) [2023] KEELRC 1370 (KLR)", Case Analysis (2023). Statement of Claim dated June 23, 2021 (Employment and Labour Relations Cause). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/1370/eng@2023-05-31

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