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ELRCDismissedNot stated in the judgment as extracted· [2025] KEELRC 160 (KLR)

Nyaboga v Central Electricals Company Limited & another (Cause 581 of 2017) [2025] KEELRC 160 (KLR)

Employment and Labour Relations Court
31 January 2025
JRJames Rika
1,794 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan engineer won on unfair termination but lost everything because he had signed a full-and-final settlement discharge after taking his final dues.

What this practically means

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Executive summary

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The Claimant, an Electrical Engineer employed orally in 2015 by the 2nd Respondent, a Director of the 1st Respondent, sued for compensation for unfair termination, notice pay, severance, medical expenses, vehicle overhaul and 'disturbances' totalling Kshs. 2,875,000 plus general damages, after his contract ended in March 2016. He completed 3 months' probation and worked 8 months in total. He claimed he was terminated without notice and that the Respondents failed to remit his NHIF contributions, forcing him to pay his own medical bills, and that they used his personal vehicle without servicing it. The Respondents admitted employment but asserted the claimant was engaged on monthly periodic contracts which lapsed when the Two Rivers substation project completed in February 2016, and that all dues were paid. The court found the Claimant became a regular employee upon completion of probation, and that termination was unfair and unlawful for want of notice, valid reason and compliance with Sections 41, 43 and 45 of the Employment Act. However, the Claimant had accepted Kshs. 98,680 as full and final settlement and executed a discharge, which the court held was voluntary and binding under Coastal Bottlers v. Kimathi Mithika. Each head of claim was barred by the discharge or otherwise unfounded. The claim was declined with no order on costs.

Key legal issues

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01

Whether the Claimant was a regular employee

Holding

Yes - he completed probation and was confirmed as a regular employee

Reasoning

Although employed orally and without a written contract, it was common ground that the Claimant served 3 months' probation successfully and was retained for a further 5 months, working 8 months in total. The court rejected the Respondents' assertion of monthly periodic engagements, holding that confirmation at the end of probation conferred full statutory protections.

p. 3
02

Whether termination was fair and lawful

Holding

Termination was unfair and unlawful

Reasoning

Both parties agreed termination was at the Respondents' instigation without notice. The Respondents failed to prove the asserted reason - completion of the Two Rivers project - and did not follow the minimum standards of fairness under Sections 41 and 45 of the Employment Act. The reason was not established under Sections 43 and 45.

p. 4
03

Whether the discharge was valid

Holding

Yes - the discharge was voluntary and binding

Reasoning

The Claimant, an educated engineer, accepted Kshs. 98,680 as full and final settlement and discharged the Respondents without expressing compulsion in his pleadings or witness statement. Applying Coastal Bottlers v. Kimathi Mithika, the discharge barred all claims, including compensation for unfair termination. His claim that he needed money for hospital bills was unsupported.

p. 4

Legal principles established

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  • An employee who completes probation becomes a regular employee entitled to full protections under the Employment Act 2007
  • A voluntarily executed full-and-final settlement discharge is a valid and binding agreement

Court orders

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  1. 1.The Claim is declined
  2. 2.No order on the costs
Jurisdiction invoked
Original jurisdiction under the Employment Act 2007

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, "Nyaboga v Central Electricals Company Limited & another (Cause 581 of 2017) [2025] KEELRC 160 (KLR)", Case Analysis (2025). Not stated in the judgment as extracted. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/160/eng@2025-01-31

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