Baya & another v Antoneta (Appeal E009 of 2022) [2023] KEELRC 2280 (KLR)
The bottom line
#Kenya's Employment Court confirmed that paying notice and giving written reasons for ending fixed term contracts protects employers from unfair termination claims.
What this practically means
#Executive summary
#Key legal issues
#Whether termination by notice under a fixed term contract constitutes unfair termination
No, where the underlying reason (operational requirement from sale of premises) is lawful and legitimate and due process under Section 40(1) was followed
The Employment Act, 2007 abolished termination at will; even with notice under Sections 35 and 36, the employer must give reasons under Sections 40, 43, 44 and 45. Here the respondent gave reasons in writing - the sale of Kipepeo House - which amount to redundancy/operational requirement, with notice and payment in lieu. Notice issued on 28 June 2021 taking effect 30 June 2021, and terminal dues including a bonus month's wage were paid.
Entitlement to severance pay
Severance pay is not due where service under the fixed term contract is under one year and is not prorated
The appellants were employed under annual fixed term contracts; the last contract ran from 1 January to 31 December 2021 and was terminated on 28 June 2021, less than a year of service. Under the redundancy provisions (Sections 2 and 40 of the Employment Act), severance pay attaches to years of service; service under a year does not attract prorated severance pay. The bonus of one month's wage paid was also not due.
Claim for unexpired term of the fixed term contract
Not payable where termination is due to a lawful operational requirement and due process under Section 40(1) is followed
Termination arising from sale of the work premises is an operational requirement which is lawful and legitimate, provided the employer undertakes due process under Section 40(1), i.e. issuance of notice or payment in lieu, which was done. The court also considered the employer's procedures and payment of terminal dues under Section 45(5)(a) in deciding justness and equity.
Legal principles established
#- A fixed term contract of employment does not create a legitimate expectation of renewal.
- Even where notice or payment in lieu issues, the employer must still give reasons for termination and follow the Employment Act procedures.
- Failure to give an employee reasons for termination results in both procedural and substantive unfairness.
- On a first appeal the court must re-evaluate the entire record and arrive at its own findings.
Court orders
#- 1.The judgment of the learned magistrate in Malindi CM ELRC No. E43 of 2021 delivered on 24 August 2022 is confirmed
- 2.The appeal is dismissed
- 3.Each party to bear own costs
- On appeal from
- Malindi Chief Magistrate's Court (ELRC)
- Malindi CM ELRC No. E43 of 2021
- Jurisdiction invoked
- First appeal from the trial court (ELRC appellate jurisdiction over subordinate court employment decisions)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Baya & another v Antoneta (Appeal E009 of 2022) [2023] KEELRC 2280 (KLR)", Case Analysis (2023). Malindi CM ELRC Appeal (from Malindi CM ELRC No. E43 of 2021). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/2280/eng@2023-09-21
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.