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ELRCPartially AllowedCause No E1051 of 2024· [2025] KEELRC 1181 (KLR)

Lusuli v Nuclear Power & Energy Agency (NUPEA) (Cause E1051 of 2024) [2025] KEELRC 1181 (KLR)

Employment and Labour Relations Court
24 April 2025
BMB. O. M. MANANI
4,296 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~17 min to read original · ~4 min brief

The bottom line

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A Kenyan employer that reverses a decision to reinstate an employee, without consulting them, must pay damages for unfair termination.

What this practically means

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Executive summary

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The Claimant, employed as Supply Chain Manager, held a three-year fixed term contract effective 6th June 2023. The Respondent issued a retirement notice on 12th January 2024 on the basis that the Claimant had attained the mandatory retirement age of 60, and relieved him of duties on 13th June 2024. The Respondent later reinstated him on 2nd September 2024 following a Public Service Commission advisory, but rescinded the reinstatement by letter dated 29th October 2024 after concluding the advisory was premised on incomplete documents. The court framed three issues: the propriety of the termination, legitimate expectation, and entitlement to reliefs. The parties produced conflicting versions of the contract, one subjecting the term to the retirement age and one not; the court held that neither document was proved or disproved since the contested page was not countersigned. However, the Standing Orders clause in both documents incorporated the Respondent's Human Resource Manual, whose clause 13.3 set retirement at 60, though in discretionary terms. The court held that the reinstatement generated a legitimate expectation of continued service, and that rescinding it following a meeting held without inviting the Claimant violated section 4 of the Fair Administrative Action Act, article 47 of the Constitution, and natural justice. Termination was therefore illegitimate. Reinstatement was refused; the court awarded three months' gross salary as compensation (Ksh. 1,570,926.00), unpaid salary for two months (Ksh. 1,047,284.00), gratuity of Ksh. 1,150,664.12, and airtime allowance of Ksh. 21,864.00, with interest and costs, subject to statutory deductions. Claims for medical cover, salary for the unexpired term, and lost employment opportunities were declined. Judgment delivered on 24th April 2025 by B. O. M. Manani, Judge.

Key legal issues

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01

Whether the fixed term contract was subject to the mandatory retirement age of 60 years

Holding

The court could not authenticate either of the two conflicting contract documents, but the Standing Orders clause in both incorporated the Human Resource Manual, whose clause 13.3 set the retirement age at 60 years

Reasoning

Both versions of the 2023-2026 contract contained a Standing Orders clause incorporating the Respondent's Human Resource Manual into the contract. Clause 13.3 of that Manual provided for retirement at 60 years. However, the clause was not mandatory ('an employee can retire'), and the Respondent had power under section 80(2) of the Public Service Commission Act to retain officers beyond retirement age.

p. 5
02

Whether the rescission of the reinstatement was lawful

Holding

The rescission was illegitimate because it generated legitimate expectation and was done without consulting the Claimant

Reasoning

By reinstating the Claimant on 2nd September 2024 and allowing him to work for two months, the Respondent aroused a legitimate expectation of continued service beyond 60. Rescinding the reinstatement through a letter of 29th October 2024, following a meeting of 24th September 2024 at which the Claimant was not invited, breached section 4 of the Fair Administrative Action Act as read with article 47 of the Constitution and natural justice.

p. 6
03

Whether the Claimant was entitled to salary for September and October 2024

Holding

Yes; the employer bore the burden of proving payment and tendered no evidence

Reasoning

The Claimant worked in September and October 2024 after reinstatement and contended he was not paid. The Respondent produced no evidence to controvert this. Under section 112 of the Evidence Act, salary payment records are within the employer's special knowledge, so the burden lay on the employer. The court awarded Ksh. 1,047,284.00 for the two months.

p. 7
04

Whether reinstatement should issue

Holding

Reinstatement was declined

Reasoning

Reinstatement requires evidence that the position is vacant and that the parties can resume the relationship without undue friction. Employer-employee relations rest on mutual trust, and reinstatement is granted only in exceptional circumstances after conflict. Neither condition was established on the evidence.

p. 6

Legal principles established

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  • Where parties produce two conflicting documents as a result of manipulation of one without further evidence, the court may hold that neither document has been proved or disproved
  • Reinstatement of an employee by the employer generates a legitimate expectation of continued service which cannot be rescinded unilaterally without observing natural justice and fair administrative action
  • A decision adversely affecting an employee's rights taken without giving him an opportunity to be heard offends the Fair Administrative Action Act and article 47 of the Constitution
  • The burden of proving payment of an employee's salary lies with the employer by virtue of section 112 of the Evidence Act

Court orders

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  1. 1.Declined to grant the primary relief of reinstatement
  2. 2.Awarded compensation for unfair termination equivalent to gross salary for three months, Ksh. 1,570,926.00
  3. 3.Awarded Ksh. 1,047,284.00 as unpaid salary for September and October 2024
  4. 4.Awarded gratuity of Ksh. 1,150,664.12
  5. 5.Awarded airtime allowance of Ksh. 21,864.00
  6. 6.Directed that amounts awarded are subject to applicable statutory deductions
  7. 7.Awarded interest on the amounts awarded at court rates from the date of the decision
  8. 8.Awarded the Claimant costs of the case

Authorities

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Legislation

  • Public Service Commission Actsection 80; section 80(2)
  • Public Service Commission Regulations, 2020Regulation 70
  • Public Service Commission Human Resource Policies and Procedures Manual for the Public Service, 2016Clause D 21
  • Employment Actsections 49, 50
  • Evidence Actsection 112
  • Fair Administrative Action Actsection 4
  • Constitution of Kenyaarticle 47
  • ELRC Procedure RulesRule 28(3)

Cases cited (3)

  • Communications Commission of Kenya & 5 others v Royal Media Services Limited & 5 others
    [2014] eKLR
  • Catherine Misikhu Khatimba v Mt. Elgon Orchards Limited
    [2017] eKLR
  • Ambogo v Sameer Agriculture and Livestock (Kenya) Limited
    (Employment and Labour Relations Cause 199 of 2022) [2023] KEELRC 2257 (KLR) (29 September 2023)
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over employment disputes (Employment Act; ELRC Procedure Rules referenced)

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, "Lusuli v Nuclear Power & Energy Agency (NUPEA) (Cause E1051 of 2024) [2025] KEELRC 1181 (KLR)", Case Analysis (2025). Cause No E1051 of 2024. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1181/eng@2025-04-24

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