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ELRCPartially AllowedCause No. E739 of 2023

Isaiah Okoth v Africa Biosystems Limited

Employment and Labour Relations Court of Kenya
25 September 2026
4,759 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~19 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled a CEO resigned voluntarily, not constructively dismissed, but his employer must still pay admitted pension dues of USD 41,590.56.

What this practically means

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Executive summary

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The Claimant, employed as CEO and Managing Director of the Respondent under a renewable five-year contract from 1st October 2021, sued claiming constructive dismissal. He alleged that a show cause letter dated 6th February 2023, a disciplinary hearing invitation dated 17th February 2023 (which dropped one charge and added a new one), and harassment forced him to resign on 21st February 2023. He sought twelve months' compensation, pension contributions of USD 41,590.56, leave underpayment of USD 1,488.10, payment for the unexpired contract term (USD 900,680), general damages, costs and interest. The Respondent denied constructive dismissal, asserting the Claimant resigned voluntarily to scuttle disciplinary proceedings, and counter-claimed for breach of non-compete and confidentiality clauses, later withdrawing the counter-claim on 29th September 2025 with costs at the lower scale. The court framed two issues: constructive dismissal and reliefs. Applying the Court of Appeal's test in Coca Cola v Ligaga, it held that issuing a show cause letter and inviting the employee to a disciplinary hearing in conformity with Section 41 of the Employment Act does not create intolerable working conditions; the Claimant resigned before the hearing and partly participating in the process removed the legal sting from a constructive dismissal claim. He was found to have resigned voluntarily under a contract allowing six months' notice. The court awarded the admitted pension sum of USD 41,590.56 (exempt from statutory deductions under Section 49(2)), with interest from filing and costs on the higher scale, but declined compensation, leave underpayment (unproved special damages), remainder-of-contract payment (not a Section 49(1) relief) and general damages.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the Claimant was constructively dismissed by the Respondent.
  2. 2.Whether the reliefs sought by the Claimant are deserved.

Key legal issues

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01

Whether the Claimant was constructively dismissed

Holding

No; the Claimant resigned voluntarily by giving six months' notice as per his contract.

Reasoning

The court applied the Coca Cola Ligaga test: the employer's conduct must be heinous and without reasonable or proper cause, likely to destroy or seriously damage the employment relationship. The Respondent merely issued a show cause letter and invited the Claimant to a disciplinary hearing with rights of accompaniment, conforming to Section 41 of the Employment Act. The Claimant resigned before the hearing without demonstrating intolerable working conditions.

p. 28
02

Whether the pension contribution of USD 41,590.56 was payable

Holding

Yes; awarded as admitted by the Respondent in pleadings and evidence.

Reasoning

The Respondent admitted the pension claim both in its pleadings and through RW-1, who confirmed the Respondent agreed to pay the pension contribution inclusive of both employer and employee portions as at 1st March 2023. The court awarded the admitted sum and exempted it from statutory deductions under Section 49(2) of the Employment Act.

p. 29
03

Whether the Respondent's counter-claim survived

Holding

The counter-claim was withdrawn with costs at the lower scale before trial judgment.

Reasoning

The Respondent sought to withdraw its counter-claim on 29th September 2025, seeking injunctions and declarations regarding non-compete and confidentiality clauses. The court marked it withdrawn with costs at the lower scale, payable after the outcome of the main suit. The court confirmed that position in the final orders.

p. 16

Legal principles established

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  • Issuance of a show cause letter and invitation to a disciplinary hearing in conformity with Section 41 of the Employment Act does not amount to constructive dismissal.
  • An employee who initiates and partly participates in disciplinary proceedings before resigning weakens a claim of constructive dismissal.
  • A claim for underpayment of leave days is special damages that must be specifically pleaded and strictly proved.

Court orders

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  1. 1.Judgment entered for the Claimant against the Respondent for USD 41,590.56 being pension contribution.
  2. 2.The awarded sum shall not be subjected to statutory deductions pursuant to Section 49(2) of the Employment Act.
  3. 3.Interest on the awarded sum at Court rates from the date of filing suit until payment in full.
  4. 4.Costs of the suit to the Claimant, to be taxed on the higher scale.
  5. 5.Costs of the withdrawn counter-claim to the Claimant, to be agreed or taxed at the lower scale, as previously ordered on 29th September 2025.

The bench

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One judgment of the whole court — no separate or dissenting opinions.

Wrote the judgment

Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment and Labour Relations Court Act over employment disputes (Employment Act claims)

Relief refused

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USD 249,996 being 12 months' compensation for constructive termination

Claimant did not demonstrate constructive dismissal

p. 29

USD 1,488.10 underpayment of leave days

Not specifically pleaded and strictly proved as special damages

p. 29

USD 900,680 payment for remainder of contract term

Not a relief provided for under Section 49(1) of the Employment Act

p. 30

General damages

No breach of the employment contract established

p. 30

Costs

Claimant awarded costs of the suit to be taxed on the higher scale; costs of the withdrawn counter-claim to be agreed or taxed at the lower scale (as ordered 29th September 2025).

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

Issuance of a show cause letter by an employer to an employee requiring the employee to show cause why disciplinary action should not be taken against him or her for alleged misconduct or poor performance cannot be equated with creation of working conditions that leave an employee with little or no choice but to resign.
p. 23show cause letter not constructive dismissal
Waiting for commencement of disciplinary proceedings and partly participating in them before resigning removes the legal sting from any accrued right to resign and to plead constructive dismissal.
p. 27effect of partial participation in disciplinary process
In sum, and having considered written submissions filed on behalf of both parties, Judgment is hereby entered for the Claimant against the Respondent for USD 41,590.56.
p. 30final orders - judgment sum
The Claimant is awarded interest on the awarded sum at Court rates, to be calculated from the date of filing suit until payment in full.
p. 30final orders - interest
The Claimant is awarded costs of the suit, to be taxed on the higher scale.
p. 30final orders - costs

Issues in the judgment

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minor

Resignation date inconsistency between pleadings and testimony

minor

Director's name spelled 'Alexis Claude' in pleadings but 'Alexis Caude' in quoted letters

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, "Isaiah Okoth v Africa Biosystems Limited", Case Analysis (2026). Cause No. E739 of 2023. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/2697/eng@2026-09-25

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