Tarmal Wire Products Limited v Munguti (Appeal E011 of 2024) [2024] KEELRC 1559 (KLR)
The bottom line
#Kenya's Employment Court ruled that a fixed-term contract that simply expires is not unfair termination, and NSSF-registered employees cannot claim service pay.
What this practically means
#Executive summary
#Key legal issues
#Whether non-renewal of a fixed-term contract constituted unfair termination
Non-renewal was lawful; the trial court erred in finding unfair termination under Section 41
Fixed-term contracts are lawful and valid under Section 10(3) of the Employment Act. The respondent's last contract lapsed on 5 November 2020. Although the respondent claimed a legitimate expectation of renewal based on successive renewals, he was on sick leave from 2 November 2020 and produced no medical certificate to justify his absence and support the expectation of renewal. The trial court's reliance on Teresa Carlo Omondi was misplaced as that decision had been overturned by the Court of Appeal, which binds this court.
Whether the respondent was entitled to service pay
Service pay was not payable because the respondent was registered with NSSF
Under Section 35(5) and (6) of the Employment Act, an employee who has enjoyed statutory deductions (NSSF) is not entitled to service pay. The respondent admitted in evidence that he was registered with NSSF, and the record contained evidence of that registration. The respondent also conceded the second ground of appeal. The trial court's finding that the employer had not remitted NSSF dues did not justify the award in these circumstances.
Legal principles established
#- A fixed-term contract does not create any legitimate expectation for renewal; each contract has a start and end date
- An employee who takes sick leave must, upon resuming duty, submit a medical certificate under Section 30 of the Employment Act, 2007
- On a first appeal the court re-evaluates and re-assesses the record while bearing in mind that the trial court heard the witnesses
Court orders
#- 1.The appeal is allowed with merit
- 2.Judgment in Kaloleni CMELRC No. E023 of 2021 is set aside
- 3.Each party bears its own costs
- On appeal from
- Principal Magistrate's Court, Kaloleni (ELRC)
- CMELRC No. E023 of 2021
- Jurisdiction invoked
- First appellate jurisdiction over the trial court's judgment in Kaloleni CMELRC No. E023 of 2021
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Tarmal Wire Products Limited v Munguti (Appeal E011 of 2024) [2024] KEELRC 1559 (KLR)", Case Analysis (2024). Not stated on the face of the judgment (appeal from Kaloleni CMELRC No. E023 of 2021). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1559/eng@2024-06-13
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.