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ELRCPartially AllowedELRC Appeal No. E021 of 2026· [2026] KEELRC 2480 (KLR)

Walker Industries Kenya Limited v Sammy James Wambua

Employment & Labour Relations Court of Kenya
18 September 2026
6,391 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~26 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ruled that repeatedly renewing a worker's short contracts for six years created a right to notice and reasons before non-renewal.

What this practically means

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Executive summary

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The Employment and Labour Relations Court at Machakos (Jemimah Keli, J) heard Walker Industries Kenya Limited's appeal against the judgment of D. Kuto (SPM) in Mavoko CMEL/MCELRC No. E037 of 2024, which had awarded the respondent, a former employee engaged on continuously renewed short fixed-term contracts from 2017 to 2023, one month's notice pay and 12 months' compensation for unfair termination. The appellant contended that a fixed-term contract expiring by effluxion of time creates no legitimate expectation of renewal and that damages were miscomputed. The court framed five issues. On legitimate expectation, it distinguished Transparency International Kenya v Omondi (where there was no renewal history) and followed Keen Kleeners Limited v Kenya Plantation and Agricultural Workers Union, holding that six years of continuous short-term renewals created a legitimate expectation of renewal or at least notice of non-renewal. Consequently, notice was due, and because the employer relied solely on effluxion of time without giving any reason for stopping the renewals, the termination was unfair. On quantum, the court held that notice pay and compensation must be computed on basic salary plus house allowance (Kshs. 16,780.80), excluding variable overtime and bonus, and reduced the excessive 12-month compensation to 6 months (Kshs. 100,684.80) under section 49(4) of the Employment Act, considering the respondent's length of service, clean record and promotion. The trial judgment was set aside and substituted accordingly, with costs of the suit to the claimant, interest at court rates, each party bearing its own costs of the appeal, and a 30-day stay of execution granted.

Key legal issues

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01

Whether periodic renewals of fixed-term contracts created a legitimate expectation of renewal

Holding

Yes - six years of continuous short-term renewals created a legitimate expectation of renewal or at least notice of non-renewal, distinguishing Omondi where there was no renewal history

Reasoning

The court applied the Court of Appeal decision in Keen Kleeners, finding the facts materially similar: continuous issuance of short fixed-term contracts from 2017 to 2023. It distinguished Transparency International Kenya v Omondi, where the employee had no history of continuous renewals. The contract had no renewal clause, but the established practice of renewal sufficed to found the expectation.

p. 21
02

Whether notice of termination was owed on a fixed-term contract

Holding

Yes - having upheld legitimate expectation of renewal or notice of non-renewal, notice of termination was due and the notice award was upheld

Reasoning

The court reasoned that once the legitimate expectation of renewal or at least notice before termination was upheld, it followed that notice of termination was due. However, it corrected the quantum, holding notice pay should be computed on basic salary plus house allowance (Kshs. 16,780.80), excluding variable overtime and bonus.

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Whether the termination was unfair

Holding

Yes - the employer gave no reason for stopping the renewals beyond effluxion of time, so termination was unfair

Reasoning

Following Keen Kleeners, once legitimate expectation was established the burden shifted to the employer to prove valid reasons for termination. The appellant relied only on effluxion of time and gave no reason for the non-renewal. The court upheld the trial court's finding of unfair termination.

p. 24
04

Whether the damages assessment was erroneous

Holding

Partially - notice pay was miscalculated at Kshs. 26,556; correct gross salary was Kshs. 16,780.80; the 12-month compensation award was excessive and reduced to 6 months

Reasoning

The payslip showed basic salary of Kshs. 14,592.00 and house allowance of Kshs. 2,188.80, with variable overtime and bonus. Since overtime and bonus were not automatic, gross salary for section 49 purposes was Kshs. 16,780.80. Considering the respondent's six years of service, clean disciplinary record and promotion, the maximum 12-month award was reduced to 6 months under section 49(4).

p. 26

Legal principles established

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  • Continuous renewal of short fixed-term contracts over a long period can create a legitimate expectation of renewal or at least notice of non-renewal, distinguishing cases with no history of renewals
  • Where legitimate expectation of renewal exists, the employer bears the burden of proving a valid reason for non-renewal; reliance on effluxion of time alone renders termination unfair
  • Notice pay under section 49 of the Employment Act is computed on basic salary plus house allowance, excluding variable overtime and bonus
  • An appellate court will not interfere with the exercise of discretion by an inferior court unless the decision is clearly wrong

Court orders

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  1. 1.Judgment and decree of the trial court in Mavoko CMEL/MCELRC No. E037 of 2024 set aside and substituted with judgment for the claimant of notice payment of Kshs. 16,780.80
  2. 2.Compensation for unfair termination equivalent to 6 months' gross salary (basic and housing) totalling Kshs. 100,684.80
  3. 3.Costs of the suit in the trial court awarded to the claimant
  4. 4.Interest at court rates on all the above
  5. 5.Each party to bear their own costs in the appeal
  6. 6.30 days' order of stay of execution granted
On appeal from
Mavoko Chief Magistrate's Court (CMEL/MCELRC)
Mavoko CMEL/MCELRC No. E037 of 2024
Jurisdiction invoked
First appellate jurisdiction over the subordinate court's employment judgment (Employment and Labour Relations Court Act; appeal from Magistrates' Court)

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, "Walker Industries Kenya Limited v Sammy James Wambua", Case Analysis (2026). ELRC Appeal No. E021 of 2026. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/2480/eng@2026-09-18

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