Temple Point Resort Limited v Omar (Suing on his behalf and on behalf of 10 others who are the former employees of Temple Point Resort Limited t/a Temple Point Resort) (Appeal E028 of 2023) [2024] KEELRC 1493 (KLR)
The bottom line
#Kenya's Employment Court confirmed that letting fixed-term contracts lapse is not unfair termination, so the resort owed the 11 former workers nothing.
What this practically means
#Executive summary
#Key legal issues
#Whether non-renewal of fixed-term contracts amounted to unfair termination
Non-renewal of fixed-term contracts on lapse is lawful; no notice or reasons required; compensation does not accrue
The court found each respondent signed successive 3-month written fixed-term contracts, the last ending 30 April 2019. Fixed-term contracts are lawful under Section 10(3)(c) of the Employment Act; the end date is infused in the contract, so non-renewal is not termination requiring notice or reasons. Following Transparency International-Kenya v Teresa Carlo Omondi, fixed-term contracts create no legitimate expectation of renewal. The maximum 12 months' compensation was also awarded without reasons.
Whether judgment could be entered for Sang and Mumbo who did not testify
The trial court erred; their claims should have been assessed on the merits rather than allowed by consent
Under Rule 9 of the ELRC Procedure Rules a representative suit is permissible, but the trial court ought to have assessed each claim on its merits. Since the claims of Sang and Mumbo were allowed by consent per the order of 4 October 2023, the court found the trial court should have analysed the responses and records with a finding instead.
Whether the appellant was liable for employment before 2016 and for underpayment
No; records showed prior employment under different entities with redundancy payments, and wages paid exceeded the applicable minimum wage
The appellant was incorporated on 13 October 2010 and only took over management in 2016. Certificates of Service record continuous service, but the court held certificates and contracts serve different purposes and are not contradictory. On wages, the court compared salaries against the Regulation of Wages (General) (Amendment) Orders and found no underpayment for Abdul Omar (mechanic) and Benson Kenga (mason), there being no proof of graded artisan status.
Whether claims pre-dating 20 June 2016 were time-barred
Yes; only claims from 20 June 2016 onwards were actionable under Section 90 of the Employment Act
The claims were filed on 21 June 2019, and Section 90 imposes a three-year limitation period. Claims arising from contracts ending 30 April 2019 could therefore only reach back to 20 June 2016; any claims alleged to have accrued on or before that cut-off date are time-barred.
Legal principles established
#- Fixed-term contracts are a lawful and legitimate mode of employment; an employer need not give notice or reasons for non-renewal upon lapse of the term
- Maximum compensation of 12 months can only be awarded where the court assigns reasons and evaluates the effect of the award
- Employment claims arising from each contract must be filed within three years under Section 90 of the Employment Act
Court orders
#- 1.The appeal is allowed
- 2.Judgment in Malindi CMELRC No. 67 of 2019 is set aside
- 3.Each party bears its own costs
- On appeal from
- Malindi Chief Magistrate's Court (ELRC)
- CMELRC No. 67 of 2019
- Jurisdiction invoked
- First appeal under section 78 of the Civil Procedure Act
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Temple Point Resort Limited v Omar (Suing on his behalf and on behalf of 10 others who are the former employees of Temple Point Resort Limited t/a Temple Point Resort) (Appeal E028 of 2023) [2024] KEELRC 1493 (KLR)", Case Analysis (2024). Malindi ELRC Appeal (from Malindi CMELRC No. 67 of 2019). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1493/eng@2024-04-26
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.