Agalomba (Suing as Personal Representative and Administrator of Grace Muhatia) v Board of Management Lions School (Employment and Labour Relations Cause E027 of 2021) [2025] KEELRC 1893 (KLR)
The bottom line
#A Kenyan employer cannot retire an employee at 60 unless a retirement age is written into the employment contract or policy.
What this practically means
#Executive summary
#Key legal issues
#Whether retirement at 60 years amounted to unfair termination
Termination was unfair for want of a valid reason because the Respondent had no policy or contractual term on retirement age, and retirement at 60 was a unilateral Board decision never communicated to the employee.
The law does not fix a retirement age; it must be set in the appointment letter, contract or another governing document. The Respondent produced no such policy, and the retirement letter referred only to a Board decision. The Claimant's reply letter showed she was taken by surprise, confirming she was unaware of any retirement age. No evidence of prior practice of retiring employees at 60 was adduced, nor when the Claimant turned 60. Attaining 60 without a policy is not a valid reason under section 43, and the termination was unjust and inequitable under section 45.
Whether the 70% salary reduction and unpaid leave were justified
The reduction and unpaid leave were justified given the Covid-19 closure of schools and the Claimant's written acceptance of the pay cut.
The Claimant signed the letter accepting the 70% cutback and could not later challenge it as unlawful. The court took judicial notice that the Respondent is a private learning institution dependent on school fees, which ceased during the Government-directed closure of schools, so the employer's action was justified in mitigating the pandemic's financial effects.
Entitlement to notice pay, gratuity, housing allowance and NHIF dues
Notice pay of one month was as provided by law; gratuity failed for want of a contractual provision and NSSF contribution; salary was consolidated; and the NHIF claim failed for lack of proof of non-remittance.
The claim for three months' notice rested on government terms inapplicable to a private employee. Service pay was barred by her NSSF contribution under section 35. Salary vouchers showed consolidated pay with no evidence of unpaid house allowance or underpayment against statutory minimum wages. The NHIF claim lacked any statement proving deductions were not remitted, and NHIF itself has statutory recovery powers, so the court declined to award it.
Compensation for unfair termination
Compensation of six months' salary (Kshs 86,400) was awarded, considering the 20 years of service and the circumstances of the Covid-19 pandemic.
Having served about 20 years, the Claimant was let off during the pandemic with no salary and no terminal benefits, while on reduced pay and unpaid leave. The Respondent could have waited until schools reopened to retire her after reinstating her salary and giving adequate notice. In these circumstances six months' salary was reasonable, assessed at Kshs 86,400.
Legal principles established
#- The law does not prescribe a retirement age; it must be set by the employer in the contract of employment or governing document, failing which retirement at a particular age is not a valid reason for termination.
- An employer must inform the employee, as part of the employment particulars under section 10 of the Employment Act, of the terms under which employment would cease, including any retirement age.
- An employee who signs a letter accepting a salary reduction cannot later claim the reduction was unlawful.
Court orders
#- 1.Compensation for unfair termination of Kshs. 86,400
- 2.Costs of the suit and interest on the awarded sum at court rates from the date of judgment till payment in full
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction over employment claims (Employment Act; the judgment does not expressly cite the constitutional provision)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Agalomba (Suing as Personal Representative and Administrator of Grace Muhatia) v Board of Management Lions School (Employment and Labour Relations Cause E027 of 2021) [2025] KEELRC 1893 (KLR)", Case Analysis (2025). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1893/eng@2025-06-27
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.