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ELRCPartially AllowedMemorandum of Claim dated 20th November, 2020· [2025] KEELRC 1994 (KLR)

Kenya Engineering Workers Union v East Africa Spectre Limited (Cause E6587 of 2020) [2025] KEELRC 1994 (KLR)

Employment and Labour Relations Court
4 July 2025
3,151 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
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The bottom line

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Kenya's Employment Court ruled that continuing to pay a worker after a fixed-term contract expires converts the job into one that can only end with proper notice and a fair hearing.

What this practically means

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Executive summary

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The Claimant Trade Union, suing on behalf of grievant Gilbert Ooro Owuor, claimed that the grievant, employed from 2014 as a general labourer and from January 2019 on a one-year fixed-term contract, had his employment terminated on 28th April/5th May 2020 on account of his union affiliation, in breach of Articles 27, 36 and 41 of the Constitution and Section 46(2) of the Employment Act. It sought service pay, three months' notice, twelve months' compensation and house allowance arrears totalling Kshs.507,464/=. The Respondent denied the claim, contending the grievant was a casual labourer from 2016, placed on a fixed-term contract that expired on 31st December 2019 and was not renewed due to unsatisfactory performance; that fixed-term contracts confer no renewal rights; that the grievant was an NSSF contributor not entitled to service pay; and that the CBA produced had expired. The court found that although the Respondent was not obliged to renew the contract, it retained the grievant for over three months after expiry with monthly pay, so termination required notice under Section 35(1)(c). The CBA, still in force (clause 40), entitled the grievant to three months' notice under clause 18; only one month's pay in lieu was given, and no Section 41 hearing preceded the termination on grounds of underperformance, rendering the termination substantively and procedurally unfair, applying Walter Ogal Anuro v TSC. The court awarded two months' salary as compensation (Kshs.45,639/=) and a further Kshs.45,639/= to complete three months' notice pay, total Kshs.91,278/= subject to statutory deductions, plus Kshs.40,000/= litigation reimbursement under Rule 70(4) of the ELRC (Procedure) Rules 2024. Claims for house allowance arrears and service pay failed. Judgment entered for the Claimant.

Key legal issues

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01

Whether the grievant's employment was terminated and whether the termination was fair

Holding

The employment was terminated; the termination was both substantively and procedurally unfair because no valid reason was proved under Section 45(2)(a) and Section 41 hearing requirements were not met, and the 3 months' notice under clause 18 of the CBA was not given

Reasoning

Although the Respondent was not obliged to renew the fixed-term contract, its continued retention of the grievant for over three months after expiry meant termination required notice under Section 35(1)(c). The CBA, still in force, entitled the grievant to three months' notice or pay in lieu, but only one month was paid, rendering the termination procedurally unfair. Further, allegations of underperformance were never put to the grievant at a hearing as Section 41 requires, and validity of reasons was not proved under Section 45(2)(a).

p. 6
02

Whether the reliefs sought are deserved

Holding

Two months' salary as compensation and two months' additional notice pay awarded; house allowance arrears and service pay declined

Reasoning

Compensation of two months' gross salary (Kshs.45,639/=) was awarded for unfair termination, and a further Kshs.45,639/= to make up three months' notice pay. House allowance failed because gross salary was inclusive of it; service pay failed because the grievant was an NSSF contributor, precluded by Section 35(6)(d) of the Employment Act.

p. 6

Legal principles established

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  • Fair termination requires both substantive justification and procedural fairness
  • Where a fixed-term contract expires but the employee continues working for over three months with monthly pay, termination thereafter requires appropriate notice under Section 35(1)(c) of the Employment Act
  • A CBA that continues in force until amended by both parties binds the employer at termination, including on notice entitlements

Court orders

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  1. 1.Compensation for unfair termination of employment of Kshs.45,639/=
  2. 2.Payment in lieu of notice of Kshs.45,639/= (being two months' salary to make up three months' notice, one month already paid)
  3. 3.Total judgment of Kshs.91,278/= against the Respondent, subject to statutory deductions pursuant to Section 49(2) of the Employment Act
  4. 4.The Respondent to pay the Claimant Trade Union Kshs.40,000/= as reimbursement of litigation expenses pursuant to Rule 70(4) of the ELRC (Procedure) Rules 2024

Authorities

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Legislation

  • Constitution of KenyaArticle 36 (freedom of association)
  • Constitution of KenyaArticle 27 (non-discrimination)
  • Constitution of KenyaArticle 41 (labour relations)
  • Labour Relations ActSection 62
  • Employment ActSection 46(2)
  • Employment ActSection 74(1)(f)
  • Employment ActSection 35(6)
  • Employment ActSection 35(1)(c)
  • Employment ActSection 41
  • Employment ActSection 45(2)(a)
  • Employment ActSection 35(6)(d)
  • Employment ActSection 49(2)
  • Employment Act and the Employment and Labour Relations Court (Procedure) Rules 2016Rule 11(2)
  • Employment and Labour Relations Court (Procedure) Rules 2024Rule 70(4)

Cases cited (1)

  • Walter Ogal Anuro – vs – Teachers Service Commission
    [2013] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act and Labour Relations Act (trade dispute reported under Section 62 of the Labour Relations Act)

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, "Kenya Engineering Workers Union v East Africa Spectre Limited (Cause E6587 of 2020) [2025] KEELRC 1994 (KLR)", Case Analysis (2025). Memorandum of Claim dated 20th November, 2020. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1994/eng@2025-07-04

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