Opondo v Standard Group PLC (Employment and Labour Relations Cause E734 of 2021) [2024] KEELRC 342 (KLR)
The bottom line
#A Kenyan court found Standard Group's probationary dismissal substantively unfair because it lacked evidence of poor performance, awarding the employee KSh 6.77 million.
What this practically means
#Executive summary
#Key legal issues
#Whether the termination of a probationary employee without a hearing was procedurally unfair
Procedurally fair: at the time of termination section 42(1) expressly excluded probationary contracts from section 41, and the declaration of unconstitutionality in Monica Kibuchi was not given retroactive effect.
The court held that retrospective invalidation of reliance on a then-valid statute would produce undesirable consequences, striking a balance between legitimate reliance interests and constitutional evolution. It relied on Chicot County and Attorney General of Canada v Hislop, and noted that in Monica Kibuchi itself the court declined to condemn the employer who relied on section 42(1) as enacted. The Respondent, guided by the prevailing law, could not be held to have terminated unprocedurally.
Whether the termination was substantively fair
Substantively unfair - the Respondent failed to prove valid and fair reason of poor performance.
Section 42(1) ousts only section 41, not sections 43 and 45, so the employer still had to prove reasons for termination and their validity. The Respondent's witness admitted there were no appraisal documents, the supervisor did not testify, and only the termination letter mentioned unsatisfactory performance. No evaluation system, targets or improvement measures were demonstrated, so the burden under sections 43 and 45 was not discharged.
Entitlement to compensation under section 49(1)(c)
Six months' gross salary (Ksh. 6,000,000) awarded, not the twelve months claimed.
The award is discretionary and depends on the circumstances of each case. The court considered the manner of termination, the refusal of gratuity, the short length of service (which minimised the award), the absence of any contribution by the Claimant to the termination, the competitiveness of the media industry and his failure to secure other employment.
House allowance
Ksh. 765,000 awarded, computed at 15% of salary for six months, the contract not showing consolidation of housing.
Section 31(2) exempts only contracts expressly consolidating a housing element in salary or covered by a collective agreement. The appointment letter did not show the salary was inclusive of house allowance and the Respondent tendered no evidence to that effect. The court adopted the 15% benchmark applied in Anna Yonemura, KUDHEIHA and approved by the Court of Appeal in Grain Pro Kenya.
Salary for the unexpired term of the contract
Refused because the contract contained a termination clause with no further obligations.
Section 49 does not provide an exhaustive list of remedies, but the court's role is to give effect to the parties' contract, not rewrite it. Clause 11 permitted termination on three months' notice or pay in lieu without further obligation as to the remainder of the period, and the Court of Appeal authority in Saboke holds such compensation available only absent a termination clause.
Damages for unfair labour practices
Refused for failure to plead the constitutional violation with precision.
A party alleging violation of constitutional rights must plead with reasonable precision the provision infringed and the manner of infringement, as stated in Anarita Karimi Njeru and Julius Meme. Scanning the Memorandum of Claim, the court found the Claimant had not precisely set out how the alleged constitutional right was violated, so no award of general damages could be made.
Legal principles established
#- A declaration of unconstitutionality does not automatically render prior actions void ab initio; actors who relied on the law as it stood at the relevant time should not be punished retrospectively.
- Section 42(1) of the Employment Act ousts only section 41 (procedural fairness) for probationary contracts; it does not oust the substantive fairness requirements of sections 43 and 45.
- An employer alleging termination for poor performance bears a high evidential burden to show a performance evaluation system, appraisal of the employee, communication of shortcomings and opportunities to improve.
- Compensation for the unserved period of a fixed-term contract is only available where there is no termination clause permitting early termination.
Court orders
#- 1.A declaration that the Claimant's termination was procedurally fair but substantively unfair.
- 2.Six months' compensation pursuant to section 49(1)(c) of the Employment Act 2007, Ksh. 6,000,000.
- 3.Unpaid house allowance of Ksh. 765,000.
- 4.Interest on the sums awarded at court rates from the date of judgment till full payment.
- 5.Costs of the suit to the Claimant.
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (sections 41, 42, 43, 45, 49); first-instance claim
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Opondo v Standard Group PLC (Employment and Labour Relations Cause E734 of 2021) [2024] KEELRC 342 (KLR)", Case Analysis (2024). Not stated in the judgment (Memorandum of Claim dated 31st August 2021). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/342/eng@2024-02-16
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.