Thande v National Environment Trust Fund (Netfund) (Cause E868 of 2022) [2025] KEELRC 2572 (KLR)
The bottom line
#A Kenyan court ruled that refusing to renew a fixed-term work contract is not unfair termination, and employers owe no duty to explain or justify that refusal.
What this practically means
#Executive summary
#Key legal issues
#Whether the Human Resource Manual created an obligation to renew the Claimant's contract and a legitimate expectation of renewal
No. The Manual's terms were not incorporated into the contracts, and clause 2.6.1 imposed a notification duty on the employee without a corresponding duty on the employer to renew. No legitimate expectation arose.
The court found none of the three contracts incorporated the Human Resource Manual, so its terms did not form part of the Claimant's terms of service. Even assuming the Manual applied, clause 2.6.1 merely required an employee wishing renewal to notify the CEO six months in advance; it left renewal to the employer's discretion. The Claimant also notified her request only four months before expiry. The requirement to give advance notice was not a promise to renew, so no legitimate expectation arose.
Whether the Respondent breached section 45(3)(e) of the Public Service Commission Act by not responding to the renewal request within three months
No. The provision requires concurrence of the Public Service Commission or parent Ministry to a proposed extension at least three months before lapse; it does not oblige an employer to respond to a renewal request within three months.
The court interpreted section 45(3)(e) as concerned with the concurrence required from the appointing or concurrence-granting authority for extensions of public service contracts, not with imposing a response deadline on the employer vis-à-vis an employee's renewal request. Accordingly the provision did not assist the Claimant.
Whether the Principal Secretary had authority to direct reinstatement
No. The power to appoint and reinstate vested in the Respondent's Board of Trustees, with terms and conditions of service for State Corporation staff vested in the Public Service Commission under Article 234(2)(f) of the Constitution.
Under the State Corporations Act, Boards appoint staff, with the only constraint being that terms and conditions must be approved per the constitutional scheme. After the 2010 Constitution, power over terms and conditions moved to the Public Service Commission, so section 5(3) must be read with modifications under section 7 of the Sixth Schedule. The Principal Secretary therefore lacked mandate; moreover, his representative sat on the Board that made the decision, making his attempted reversal paradoxical.
Whether the non-renewal amounted to unfair termination
No. The contract lapsed by effluxion of time; the employer was under no obligation to renew or justify non-renewal, and in any event gave reasons (lack of requisite academic qualifications and missing 'O' Level certificate).
The court reiterated that a fixed term contract ends on its sunset date without creating renewal expectancy. The Respondent, though not obliged to justify non-renewal, explained the decision by reference to the Claimant's lack of degree proof and failure to provide her High School certificate despite reminders; the Claimant conceded in cross-examination the position required a degree. Non-renewal was therefore lawful and not unfair termination.
Legal principles established
#- Terms of a Human Resource Manual are not automatically incorporated into individual employment contracts absent an express incorporation clause
- A fixed term contract expires on its sunset date through effluxion of time and creates no expectancy of renewal absent express agreement
- An employer has no obligation to justify refusal to renew a fixed term contract
- Parent Ministries have no power to appoint staff or direct reinstatement for State Corporations; appointment powers vest in the Boards, with terms and conditions of service now vested in the Public Service Commission under Article 234(2)(f)
Court orders
#- 1.The suit is dismissed
- 2.The Respondent is directed to issue the Claimant with a Certificate of Service in terms of section 51 of the Employment Act
- 3.Each party to bear own costs of the suit
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction over employment disputes (Employment Act; ELRC Procedure Rules referenced)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Thande v National Environment Trust Fund (Netfund) (Cause E868 of 2022) [2025] KEELRC 2572 (KLR)", Case Analysis (2025). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2572/eng@2025-09-25
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.