https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/2383

**REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT** **APPEALS DIVISION** **ELRC NO. E059 OF 2025** **(CONSOLIDATED WITH APPEALS NOS: E005 and E058 OF 2025)** BETWEEN CALE INFRASTRUCTURE COMPANY LIMITED………..APPELLANT AND JOHN WANGILA SITATI …………………………1ST RESPONDENT HENRY ONGANYO AMBATA …………………..2ND RESPONDENT WILFRED ONKEO NYABUTO………………….…3RD RESPONDENT (Being an appeals from the Judgments delivered by Hon. P.A Olengo, T.M Olando and Hon. H.M Ng’ang’a in Milimani Commercial Chief Magistrate’s Court in MCELRC/E398 /2023, E1791 of 2022 and E112 of 2022, delivered on 30th January, 2025, 17th December, 2024 and 14th February, 2025) JUDGMENT *(Before Hon. Justice Abuodha Jorum Nelson)* 1. Through the Memorandum of Appeals dated 25th February, 2025, 9th January, 2025 and 25th February, 2025 the Appellant appeals against the whole of the Judgments delivered by the above trial courts raising the grounds in summary that the trial court erred in finding that John Wangila was employed up to August 2022 when his contract expired on April 2022, the trial court erred in finding that the Respondents were unfairly terminated and awarding them their reliefs sought. 2. The Appellant prayed that the judgements of the subordinate courts be set side and the orders vacated and the Appellant be awarded the costs of this Appeal. 3. The court on 25th February, 2026 directed that this appeal be consolidated with Appeal numbers E058 and appeal number E005 of 2025 with Appeal E059 of 2025 being the lead file. The Appeals were disposed of by written submissions. **APPELLANT’S SUBMISSIONS** 1. The Appellant’s Advocates Mutuohoro Gakuru Company Advocates filed written submissions dated 12th March, 2026 and counsel submitted that from the onset that this court has the jurisdiction. Counsel relied on the case of **Owners of the Motor Vessel “Lillian S” v Caltex Oil (Kenya) Ltd [1989] KLR 1,** where Justice Nyarangi pronounced himself that jurisdiction is everything and the same ought to be raised at the earliest opportunity. Counsel also relied on the case of **Macharia & another v Kenya Commercial Bank Limited & 2 others (Application no 2 of 2012) [2012] KESC 8 (KLR) (23 October 2012),** where it was held that a court’s jurisdiction flows from either the constitution or legislation or both. 2. Counsel submitted that the appeals were first appeals against the judgments of trial court magistrates and this court has the duty of re-assessing the evidence and reaching its own conclusions on matters of fact and law while relying on the Court of Appeal for East Africa in **Peters vs Sunday Post Limited [1958] EA 424**. 3. On the issue of whether the learned magistrates erred in facts in reaching their decisions counsel submitted that in the case of MCELRC/E1791/2022 HENRY ONGANYO AMBATA VERSUS- CALE INFRASTRUCTURE COMPANY LIMITED the learned magistrate made a finding that the Appellant never tendered any evidence in support of its response. That this finding is factually incorrect and contrary to the record of appeal. The Appellant filed: statement of response; list of witnesses; witness statement; list of documents; and written submissions. 4. It was submitted that the record of appeal clearly demonstrated that the Appellant participated in the proceedings and placed its case before the trial court. That by stating that no evidence was tendered, the learned magistrate misapprehended the record and thereby arrived at a conclusion not supported by any facts in the proceedings. 5. Counsel submitted that in the case of MCELRC/E398/2023 JOHN WANGILA SITATI – VERSUS- CALE INFRUSTRUCTURE COMPANY LIMITED, the Hon. Magistrate held that the Claimant was terminated in August 2022.In his judgement, the magistrate relied on the Claimant’s NSSF statement. Counsel invited the court to look at the Claimant’s NSSF statement. That the Claimant’s monthly contribution was for the period between 1999 to 2022. All through these years there were monthly contributions. 6. It was submitted that the Respondent herein stated he was employed by the Appellant on 12th May 2022 which the Hon. Magistrate agreed with however, the court disagreed with the Appellant when it clearly provided that the Respondent’s employment lapsed on 5th April 2022. The Hon. Magistrate stated, that Appellant did not explain why the Claimant's contribution to NSSF was remitted up to the month of August 2022. 7. Counsel submitted that by the argument of the court, then the court ought to have as well questioned the NSSF monthly contributions from 1999 to 12th May 2022 which were clearly not made by the Appellant. Simply put, the NSSF contribution document showed that the Claimant was employed from 1999 to August 2022. It did not mean that he was exclusively employed by the Appellant during this period. 8. Counsel submitted that in the case of MCELRC/E112/2022 WILFRED ONKEO -VERSUS-CALE INFRASTRUCTURE COMPANY LIMITED, the learned magistrate held that the basic salary of the Respondent was Kshs 37,000 yet the Appellant produced copy of the Respondent’s payslip clearly showing the basic pay was Kshs 21,447.48. 9. On the issue of whether the learned magistrates erred by finding that the Claimants were unfairly terminated counsel submitted that the Appellant in all circumstances acted as per the law. The Appellant in the cases terminated the Respondents lawfully through redundancy. That under Sections 43 and 45 of the Employment Act, the burden of proof lies upon an employee to prove unfair termination. The Respondents did not discharge this burden to the required legal standard. That the learned magistrates failed to analyse whether there existed a valid reason for termination and whether due process was followed. 10. On the issue of whether the earned magistrates erred by finding that the Claimants were entitled to the orders sought counsel submitted that in the case of MCELRC/E1791/2022 HENRY ONGANYO AMBATA VERSUS- CALE INFRASTRUCTURE COMPANY LIMITED the learned magistrate awarded the Respondent Kshs 227,500/=. That the award was unmerited as the learned magistrate did not consider the Appellant’s evidence in arriving at the award. 11. In the case of MCELRC/E398/2023 JOHN WAGILA SITATI – VERSUS- CALE INFRUSTRUCTURE COMPANY LIMITED the court made a finding that the Respondent was not paid housing allowance and overtime and payment in lieu of notice yet the Appellant provided the Claimant’s payslip showing the same was paid and employment contract clearly showing the date for the end of contract. 12. In the case of MCELRC/E112/2022Wilfred Onkeo -Versus- Cale Infrastructure Company Limited, the Learned Magistrate awarded Kshs 250,000/= for wrongful and unfair termination. Counsel submitted that the Employment Act, section 49(1)(c) provides that compensation for unfair termination shall not exceed twelve months’ gross salary and must be assessed based on specific statutory factors. That the awarded sum of Kshs 250,000 had no basis. The learned magistrate did not provide how he arrived at that figure. 13. On the issue of whether the learned magistrates erred and thus arrived at wrong decisions counsel submitted that from the above submissions, the learned magistrate failed to properly evaluate the documentary and oral evidence tendered by the Appellant and thereby arrived at an erroneous finding. 14. On the issue of whether in all the circumstances of the case, the learned magistrates failed to render justice to the Appellant counsel submitted that from the above, the learned magistrates failed to render justice to the Appellant. **RESPONDENTS’ SUBMISSIONS** 1. The Respondents’ Advocates Bizimana Associates Advocates filed written submissions dated 25th March,2026 and counsel relied on the case of **Peters v Sunday Post Limited (1958) EA** **424** on the role of the first appellate court and on grounds 1, 2 and 3 counsel submitted that the grounds were without merit and represent a desperate attempt by the Appellant to re-litigate facts that were properly determined by Hon. P.A. Olengo in his judgment dated 30th January, 2025. That the magistrate carefully evaluated the Respondent’s NSSF statement which showed that the Appellant made monthly contributions for the Respondent from March 2022 up to and including August 2022. 2. It was submitted that employers only remit NSSF contributions for active employees. That the documentary evidence coupled with the Respondent’s testimony overwhelmingly proved continued employment until August 2022. That the Appellant’s claim of automatic contract expiry on 5th April, 2022 was correctly rejected as contradicted by its own actions of continuing remittances. That the magistrate did not err on this issue to justify appellate interference. 3. Counsel submitted that the finding of unfair termination was equally unassailable because the Appellant terminated the Respondent without any termination letter, without giving reasons, without affording him an opportunity to be heard and without following any redundancy procedure. That sections 41, 43 and 45 of the Employment Act were blatantly violated. That the Appellant produced no evidence of genuine operational reasons for redundancy, no consultation, no fair selection criteria and no involvement of the labour officer. 4. It was submitted that the magistrate properly held that the Appellant failed to discharge its statutory burden. Counsel relied on the case of **Florence Wanjiru Githatu v Kenya Association of Manufacturers (2016) eKLR** that records of NSSF constitute strong prima facie evidence of employment duration which the Appellant failed to rebut. That the decision on both employment duration and unfair termination was correct and should be upheld. 5. Counsel submitted that the grounds raised by the Appellant were nothing more than a general dissatisfaction with a judgment that went against it. That the magistrate analyzed all evidence tendered including the Appellant’s payslips and contract documents but found them insufficient to override the NSSF proof of continued employment and the total absence of procedural fairness. 6. It was submitted that appellate courts do not interfere merely because the Appellant wishes the facts had been decided differently while relying in **Peters V Sunday Post Limited (1958) EA 424** that the facts and credibility of the trial court must be respected unless they are found perverse which was not in this case. 7. On grounds 4& 5 on notice pay and overtime counsel relied on section 35 of the Employment Act which provides for notice pay or payment in lieu of notice. In this case, the Appellant terminated the Respondent’s employment on or about 13th August 2022 without issuing any termination letter, without providing any notice, and without paying any salary in lieu of notice. The learned magistrate correctly found that the Respondent was entitled to one month’s notice pay after evaluating the Respondent’s witness statement which detailed the abrupt termination without any procedural safeguards. The Appellant failed to produce any documentary proof of notice having been given or paid. This finding was firmly grounded in law and the uncontroverted by facts. The magistrate did not err but properly applied the clear provisions of the Act to protect the Respondent’s rights. 8. It was submitted that similarly, the award of overtime was fully justified and supported by credible evidence. The Respondent testified that he worked from Monday to Sunday between 7:30 a.m. and 6:30 p.m. or 7:30 p.m., far exceeding the statutory 52-hour weekly limit prescribed under the Regulation of Wages (General) Order. This evidence was corroborated by the length of service established through the Appellant’s own NSSF contributions up to August 2022. The Appellant’s payslips tendered in court did not comprehensively cover the overtime worked during the entire period of employment, particularly in the terminal months. 9. That the learned magistrate properly exercised judicial discretion by accepting the Respondent’s un-rebutted testimony on this issue and awarding appropriate overtime compensation. There was no error in fact or law. The Appellant’s bare denial and reliance on incomplete payslips could not displace the Respondent’s credible account. 10. It was submitted that the Appellant’s written submissions on these issues were duly considered by the magistrate but could not cure the glaring evidential deficiencies in its defence. Submissions are arguments, not evidence, and cannot override primary documentary proof such as the NSSF statement or the Respondent’s consistent testimony. The magistrate rendered a balanced and just decision by awarding only those terminal benefits that were properly proved on a balance of probabilities. 11. These findings on notice and overtime are neither perverse nor unsupported by the record. Interfering with them would undermine the protective purpose of the Employment Act. The combined grounds lack any merit and represent nothing more than the Appellant’s dissatisfaction with a correct and well-reasoned judgment. This Honourable Court should uphold the magistrate’s findings on these issues in their entirety. SUBMISSIONS IN RESPECT OF HENRY ONGANYO AMBATA (ELRCA/E005/2025 – Original trial Case MCELRC/E1791/2022) 1. On ground 1 counsel submitted that the learned magistrate carefully considered the entire record including the Respondent’s evidence of employment and termination without due process and the Appellant’s filings. The judgment demonstrates a clear application of Sections 43 and 45 of the Employment Act which place the burden on the employer to prove both a valid reason and fair procedure for termination. The Magistrate found that the Appellant failed to discharge this burden, a conclusion fully supported by the lack of any termination letter, hearing or proper redundancy documentation. 2. It was submitted that the Appellant’s generalized complaint fails to pinpoint any specific error. A thorough reading of the judgment reveals a detailed analysis of the facts, the Respondent was terminated abruptly without notice or opportunity to be heard, contrary to Section 41. That the decision aligns with established jurisprudence such as **Kenya Power & Lighting Company Ltd v Aggrey Wasike [2017] eKLR,** where the Court emphasised that employers cannot evade liability through vague assertions. The magistrate’s findings are logical, evidence-driven and just. This ground must fail. 3. On ground 2 counsel submitted that the magistrate did not state that the Appellant tendered “no evidence” in an absolute sense but correctly observed that the evidence tendered was insufficient to prove fair termination. Filing pleadings and lists of documents does not equate to adducing probative evidence capable of discharging the statutory burden. The Appellant’s documents were largely generic and did not address the core issues of valid reason or procedural fairness. 4. It was submitted that a fair reading of the record shows the magistrate considered the Appellant’s statement of response and attachments but found them inadequate. No witness testified effectively to support redundancy claims, and no documentary trail of consultation, selection criteria or Labour Officer notification was produced. The magistrate’s observation was a fair comment on the quality and sufficiency of the evidence and not an error. 5. Counsel submitted that this complaint is a misrepresentation designed to distract from the Appellant’s failure. Counsel relied on the case of **Postal Corporation of Kenya v Andrew Kimtai [2014] eKLR**, where the court held that an employer must adduce credible cogent evidence proving fairness. Mere presence of documents on the record does not suffice. The Magistrate properly exercised judicial discretion. This ground lacks merit and should be dismissed. 6. On ground 3 counsel submitted that the magistrate did take the Appellant’s evidence into account but found it deficient. The documents filed did not demonstrate compliance with the mandatory procedures under the Employment Act. Redundancy required genuine operational justification, fair selection, consultation, and payment of benefits -none of which were proved. That the judgment explicitly references the Appellant’s response and explains why it was insufficient. The Appellant cannot now claim non-consideration simply because the outcome was unfavorable. 7. On ground 4 counsel submitted that the learned magistrate did not fail to take into account the Appellant’s written submissions. A proper reading of the judgment reveals that the magistrate explicitly considered the Appellant’s arguments but correctly found that they could not cure the fundamental evidential gaps in the Appellant’s case. Written submissions are merely legal arguments and advocacy; they do not constitute evidence. They cannot substitute for the mandatory requirement under sections 43 and 45 of the Employment Act that the employer must prove a valid reason for termination and that a fair procedure was followed. 8. Counsel submitted that if submissions alone could override insufficient evidence, employers could routinely evade liability through clever lawyering rather than compliance with the law. The magistrate’s approach is fully supported by **Walter Ogal Anuro v Teachers Service Commission [2013] eKLR** and **Kenfreight (E.A.) Ltd v Benson K. Nguti [2016] eKLR,** which emphasise that the employer’s burden under section 43 cannot be discharged by submissions alone. The judgment demonstrates intellectual honesty and fidelity to the record. This ground is without merit and should be dismissed outright. 9. On combined grounds 1, 5 & 6 counsel submitted the combined grounds are vague, repetitive and lack any specific particularity that would enable this Honourable Court to identify an actual error. The learned magistrate delivered a comprehensive well-reasoned judgment on 17th December 2024 after meticulously analyzing the Respondent’s Memorandum of Claim, verifying affidavit, witness statement, list of documents and the Appellant’s statement of response together with its attachments. The Magistrate correctly applied the mandatory provisions of Sections 43 and 45 of the Employment Act which unequivocally place the burden of proof on the employer to demonstrate both a valid reason for termination and strict adherence to fair procedure. The Appellant failed woefully to discharge this burden. 10. Counsel submitted that the magistrate cannot be faulted for arriving at the correct legal conclusion that the termination was unfair. Appellate courts are not required to re-hear the matter as if it were a trial de novo. Reliance was placed in **Peters v Sunday Post Limited [1958] EA 424** and **Selle & Another v Associated Motor Boat Co. Ltd [1968] EA 123**, that this court should not disturb the trial Magistrate’s findings unless they are perverse-a threshold the Appellant has not come close to meeting. The decision was logical, evidence-based and consistent with the record. SUBMISSIONS IN RESPECT OF WILFRED ONKEO NYABUTO (ELRCA/E058/2025 – MCELRC/E112/2022) 1. On combined grounds 1 & 2 counsel submitted that the learned principal magistrate committed no error by finding that the Claimant earned a monthly salary of Kshs. 37,000. This finding was based on consistent, unchallenged evidence from the Claimant, including the memorandum of claim, verifying affidavit, witness statement and the demand letter dated 9th October 2021. The payslip produced further supported earnings at or around this level. 2. It was submitted that the Appellant failed to produce any employment contract, payroll records, or other documentary proof to rebut the Claimant’s evidence despite being put on strict proof. Kenyan courts have repeatedly held that an employer who fails to maintain or produce statutory records cannot benefit from such failure. Reliance was placed on among another the case of **Timothy Asudi Malwa v E-Gap Solutions Limited [2016] eKLR**, on this assertion that the employee’s word stand as credible evidence. 3. It was submitted that the Appellant’s general assertion of error does not demonstrate any perversity in the magistrate’s finding. The trial court evaluated all evidence on record and arrived at a conclusion supported by the preponderance of evidence. Appellate courts are slow to interfere with findings of fact by a trial magistrate unless shown to be based on no evidence or wholly unreasonable. Here, the salary finding was reasonable and grounded on the record. The combined ground on this issue therefore, lacks merit and ought to be dismissed. 4. On combined ground 3 & 4 counsel submitted that the Magistrate did not err in law or fact by awarding Kshs. 250,000 as compensation for unfair termination. The evidence established both procedural and substantive unfairness: the Claimant was summarily terminated without a hearing, without a termination letter, and without terminal dues. The Appellant’s redundancy defence was unsupported by any notice or proof of compliance with Section 40 of the Employment Act. 5. Counsel submitted that Section 49(1)(c) of the Employment Act grants the court discretion to award compensation up to 12 months’ salary, considering factors under Section 49(4). The award of approximately 7 months’ equivalent salary was modest, reasonable, and took into account the short service period while addressing the Appellant’s violations. Reliance was placed on the case of **Wenani v Comply Industries Limited (Cause 745 of 2019) [2025] KEELRC,** where the court awarded 10 months’ salary for unfair termination after considering similar procedural breaches. The magistrate exercised discretion judiciously and did not fail to render justice. 6. Counsel submitted that far from failing to render justice, the magistrate delivered a balanced judgment that upheld constitutional protections under Article 41 while remaining proportionate. The Appellant’s claim of injustice ignores its own failures -lack of contract, denial of leave and non-payment of dues. That the judgment aligns with the protective intent of the Employment Act. Appellate intervention is unwarranted in the absence of demonstrated miscarriage of justice. In all circumstances, substantial justice was rendered and this combined ground must fail. 7. Counsel also submitted on distinguishing the three Appeals. That although the three consolidated appeals arise from the same Appellant and share fundamental similarities — namely, claims of unfair termination without issuance of a termination letter, denial of opportunity to be heard, failure to prove a valid reason or fair procedure under Sections 41, 43 and 45 of the Employment Act and unsubstantiated redundancy defences — each case presents distinct factual and legal issues. In Henry Onganyo Ambata’s appeal (ELRCA/E005/2025) the core dispute centred on the total absence of any termination process whatsoever, with the magistrate correctly finding that the Appellant failed to adduce any credible evidence of fair termination. 8. In John Wangila Sitati’s appeal ELRCA/E059/2025, the main contention was the duration of employment, where NSSF contribution records conclusively proved continued employment until August 2022 contrary to the Appellant’s claim of automatic expiry of the contract in March 2022, together with entitlements to one month’s notice pay and overtime for work beyond statutory hours. 9. In Wilfred Onkeo Nyabuto’s appeal ELRCA/E058/2025, the appeal challenged the finding on the Claimant’s monthly salary of Kshs. 37,000/ and the reasonableness of the Kshs. 250,000 compensations awarded for unfair termination. Despite these factual distinctions, the Appellant’s consistent failure to discharge its statutory burden renders all three appeals equally lacking in merit. **DETERMINATION** 1. The court has considered the grounds in the respective Memorandum of Appeal, the Record of Appeal and the submissions filed by the parties herein and authorities relied on in the respective appeals and notes that the court on 25th February, 2026 consolidated this appeal with Appeal number E058 and Appeal E005 of 2025 with Appeal number E059 of 2025 being the lead file where the outcome in this file would affect the other appeals. 2. It is now settled law that the duty of the first appellate court is to re-evaluate the evidence in the subordinate court both on points of law and facts and come up with its own findings and conclusions as held in **Abok James Odera t/a A.J Odera & Associates v John Patrick Machira t/a Machira & Co. Advocates [2013] eKLR,** the same stated with regard to the duty of the first appellate court; *“This being a first appeal, we are reminded of our primary role as a first appellate court namely, to re-evaluate, re-assess and reanalyze the extracts on the record and then determine whether the conclusions reached by the learned trial Judge are to stand or not and give reasons either way”* 1. The Judgment of the trial court in appeal number E059 of 2025 was that the trial court found that the Respondent was an employee of the Appellant from March 2022 to August 2022 and he was unfairly terminated. He was awarded notice pay of Kshs 14,362.40/=, overtime of Kshs 83,936.10/=, compensation for unfair termination at 6 months***’*** salary of Kshs 86,174.40/= and three months house allowance of Khs 6,463.98/= totalling to Kshs 193,935.98/= 2. On appeal number E058 of 2025 the judgment of the trial court was that the dismissal of the Respondent was unfair and he was awarded his terminal dues totalling to Kshs 250,000/= at a salary of Kshs 37,000/= per month. In Appeal number E005 of 2025 the judgment of the trial court was that the Respondent’s termination was unfair and he was awarded one month-notice pay of Kshs 35,000/=, severance Kshs 17,500/= and 5 months’ salary as compensation for unfair termination of Kshs 175, 000/= totalling to Kshs 227,500/=. 3. The Appellant was aggrieved by the above judgments delivered by different magistrates with Appeal E059 of 2025 appealing the judgment delivered on 30th January, 2025 by Hon. P.A. Olengo, Appeal E058 of 2025 judgment delivered on 14th February, 2025 by Hon. HM. Ng’ang’a and Appeal E005 of 2025 judgment delivered on 17th December, 2024 by Hon. T.M Olando. This court from the pleadings and record finds that the issues for determination are as follows: - 4. Whether the trial magistrate erred in finding that the Respondent in lead file that is John Wangila Sitati was employed from March, 2022 to August 2022 as per the NSSF statement. 5. Whether the trial Magistrates erred by finding that the Respondents were unfairly terminated 6. Whether the trial Magistrates erred in awarding the Respondents the reliefs sought. **Whether the trial magistrate erred in finding that the Respondent in lead file that is John Wangila Sitati was employed from March, 2022 to August 2022 as per the NSSF statement.** 1. The Appellant alleged that the Respondent was employed as a labourer from 6th March, 2022 to 5th April, 2022 where his contract ended by effluxion of time. They attached the letter of employment, the letter of lapse of the contract and the payslip. First the letter of lapse of the contract was not even necessary since fixed term contracts end at their end date with no need of issuing any notice to the employee. 2. The trial court relied on the NSSF statement which showed that the Appellant made deductions on behalf of the Respondent from March to August 2022. The Appellant as the custodian of employment records under section 74 of the Employment Act ought to have produced attendance registers or muster rolls showing that the Respondent stopped attending work on the end of the contract on 5th April, 2022. 3. The failure to produce any records this court takes the Respondent’s word as true that he continued working past the fixed term contract given by the Appellant as per the NSSF deductions and his testimony. The trial court was therefore justified in finding that the Respondent was employed from March, 2022 to August 2022. 4. This therefore means that his contract was constructively renewed since after expiry of the fixed term contract the parties continued working applying the existing terms without giving the Respondent any new contract or relieving him of his duties. 5. This court takes the view that the Respondent whose fixed term contract ended in April 2022 and he continued working past the expiry of the contract he had legitimate expectation for renewal of his contract. Regarding the considerations to be made when considering whether a legitimate expectation for renewal of a fixed term contract was created, the sentiments of Rika J. in **Teresa Carlo Omondi v Transparency International- Kenya [2017] eKLR** guide this court as follows- “*The burden of proof, in legitimate expectation claims, is always on the Employee. It must be shown that the Employer, through regular practice, or through an express promise, leads the Employee to legitimately expect there would be renewal. The expectation becomes legally protected, and ought not to be ignored by the Employer, when managerial prerogative on the subject is exercised. Legitimate expectation is not the same thing as anticipation, desire or hope. It is a principle based on a right, grounded on the larger principles of reasonableness and fair dealing between Employers and Employees. The Employee must demonstrate some rational and objective reason, for her expectation. The representation underlying the expectation must be clear and unambiguous. The expectation must be induced by the decision maker. The decision maker must have the authority to renew. Repeated renewals, extended service beyond the period provided for in the fixed term contract, and promise of renewal, are some of the elements that would amount to objective reasons underlying expectation of renewal. The presence of these elements however, is not to be taken as conclusive proof of legitimate expectation.”* 1. In the case of **Otiende v Ligawa & another (Petition E052 of 2022) [2023] KEELRC 3363 (KLR) (13 December 2023) (Judgment)** the court observed as follows: - *In the Court’s view, the conduct of the Respondents not only created a legitimate expectation on the Petitioner but also led to an inference that he was still an employee until released formally in terms of clause 1(iv) of the contract*. 1. The conduct of the Appellant in this case where it continued paying the Respondent his salary and it never objected to the Respondent’s continuation of work amounted to the Respondent’s legitimate expectation. The parties were presumed to be bound by the terms of the existing contract. 2. This court finds that going by the Appellant’s assertions that the Respondent was engaged as a labourer as claimed converted him to term employee under section 37 of the Employment Act . 3. The Respondent had converted to a term employee and therefore enjoyed the protections of the law as provided under section 37 of the Employment Act. The trial court did not err in finding that the Respondent worked for the Respondent from March 2022 to August 2022 as per the NSSF statement. **Whether the trial magistrates erred in finding that the Respondents were unfairly and unlawfully terminated.** 1. As for the first Respondent this court notes that courts have held severally that where an employer and employee continue the employment relationship after expiry of fixed term contract such an employee who is paid month to month converts to an employee to be only released with notice as per section 35(1) (c) of the Employment Act. 2. This position was emphasized by this court in **Stella Mukwana Siboko & another v Style Industries Limited [2022] KEELRC 769 (KLR)** where the court held as such: \_ *In the upshot, the court does not agree with the Respondent that at the time of termination of the Claimant’s employment, the latter had been working under respective fixed term contracts, which lapsed at their appointed dates, hence the termination. However, I am prepared to agree with the Claimants that after their initial fixed term contracts herein before mentioned that lapsed after expiry of their lifespans, they were not placed under any other fixed term contracts, but they continued to work for the Respondent.* *As a consequence, I hold that the employee-employer relationship that was between the Respondent and the Claimants was a month to month employment contract terminable as stipulated under section 35 (1)(c) of the Employment Act.* 1. This means therefore the Respondent could only be released upon notice as required by the law. This means John Wangila was unfairly terminated on gist of his contract having lapsed yet he continued working past the contract period as observed earlier. Henry Onyango was terminated on March 2022 as per termination letter and the reason was redundancy. There is a letter to county labour office dated 3rd February, 2022 received the same date. There is also another redundancy termination letter dated 24th December, 2021 where the Appellant had again notified the labour office on 1st November, 2021. There is also the letter dated 11th April, 2022 on lapse of the contract which was to expire on 12th April, 2022. This was the last termination on behalf of this Respondent. 2. From the records the Appellant was issuing redundancy notices but still continue engaging the services of the Henry hence the Appellant abandoned the redundancy notices and now the termination was based on lapse of contract on 12th April, 2022 past the period stated in the redundancy notices. To this court there was a cycle of the Appellant issuing redundancy notices, the redundancy not taking place, the employee continues working hence the conduct of the Appellant had made the Respondent have legitimate expectation that his contract would still go on. He was to be terminated with the required notice under the law. 3. As for the Wilfred Nyabuto he was terminated on 17th April, 2021 under redundancy grounds without there being any notice to the Respondent or to the Labour office. The Appellant ought to prove the reasons given for redundancy were fair and valid. This court agrees with the trial court that the Respondents discharged their burden of proof that termination which was unfair had occurred and it was upon the Appellant to justify the termination under section 47(5) of the Employment Act. 4. Courts have spoken severally to the issue of termination on account of redundancy while stating that termination of an employee on account of redundancy and retrenchment without justification is procedurally wrong amounting to unfair termination. On substantial justification, the employer is mandated to prove the reason for termination under section 43 of the Employment Act which if not proved amounts to unfair termination under section 45 of the said act. The Appellant maintained that the Respondents were terminated on account of redundancy. 5. Whereas the employer is given power under section 40 of the Employment Act to restructure its business to stay afloat the reason for retrenchment must be valid. As to the procedure of the redundancy the court finds that Section 40 of the Employment Act caters for the procedure to be adopted by an employer who intends to terminate an employee on account of redundancy. Particularly Section 40(1) (b) of the Employment Act provides that the employer must notify the employee personally and in writing of the reasons and the extent of the redundancy at least one month before the date when the redundancy is to take effect. 6. In this case the Respondents were terminated without notice since Wilfred was given no notice, Henry was said to be terminated due to lapse of contract since the redundancy notices given in November 2021 and February 2022 had since expired and the Respondent continued working. The Respondents were therefore not given any required notice of 30 days. 7. On the requirement for consultation, the Appellant never proved that the Respondents were consulted since they were terminated immediately on account of redundancy. Unless the circumstances are such that it would be an utterly futile exercise to hold any meaningful negotiations, consultation has to be real and not cosmetic. The New Zealand Chief Judge succinctly expressed this point in the case of **Cammish v. Parliamentary Service12:** *“Consultation has to be a reality, not a charade. The party to be consulted must be told what is proposed and must be given sufficiently precise information to allow a reasonable opportunity to respond. A reasonable time in which to do so must be permitted. The person doing the consulting must keep an open mind and listen to suggestions, consider them properly, and then (and only then) decide what is to be done*.” 1. The court finds that the requirement of consultation is meant to cause the parties to discuss and negotiate a way out of the intended redundancy, if possible, or the best way of implementing it if it is unavoidable and failure by the Appellant to meet this requirement faults the procedural requirement. 2. On the selection criteria while considering the “seniority in time” in Section 40(1)(c) of the Employment Act, the Appellant did not provide any criteria it used to declare the Respondents redundant. The notices to the labour office did not specify which employees were to be declared redundant and the criteria used. The Appellant did not pay the Respondents their severance pay and leave days as well as the one month’s salary pay in lieu of notice as required by the law. In the case of **Kenya Airways Limited V Aviation & Allied Workers Union Kenya & 3 Others [2014] eKLR**it was held that termination of employment on account of redundancy is justified if there is substantive justification for declaring redundancy and there is procedural fairness in the consequent retrenchment. 3. In this case neither the substantive or procedural fairness was justified. This court therefore upholds the trial court decision that the termination of the Respondents was unfair and unlawful. **Whether the trial courts erred in awarding the Respondents the reliefs sought.** 1. The trial magistrates having found that the Respondents were unfairly terminated was justified in awarding the compensation for unfair termination as they did. The trial courts observed the considerations under section 49(4) and in awarding the compensation. This court will only interfere with the discretion of the trial court in awarding damages if a number of factors are proved as was held in the case of **Kenya Revenue Authority & 2 others v Darasa Investments Limited (2018) eKLR** where the court held; *The court ought not to interfere with the exercise of discretion unless it is satisfied that the Judge misdirected himself in some matter and as a result arrived at a wrong decision, or that it be manifest from the case as a whole that the judge was clearly wrong in the exercise of discretion and occasioned injustice.* 1. This court notes that John Wangila was awarded 6 months’ salary and he had worked for 5 months, while Henry who had worked for around one year two months was awarded 5 months’ salary and Wilfred was awarded a total sum of Kshs 250,000/ without specifying the compensation for unfair termination and he had worked for around 9 months. 2. This court considers the fact that the Respondents had worked for the maximum one year two months and even if the termination was unfair and they did not contribute to their termination the short period served by the Respondents the trial magistrates awarded compensation which was inordinately too high in the circumstances. The Respondents would adequately be compensated by one-month salary as compensation for unfair termination. The awards are therefore varied accordingly. 3. The Respondents were also entitled to one-month salary as payment in lieu of notice since they were terminated without notice as per provisions of section 35 and 36 of the Employment Act. 4. Concerning overtime and house allowance on behalf of John Wangila the same were continuous injuries which ought to be filed within 12 months after cessation of employment as per provisions of section 90 of the Employment Act. In this case the Respondent was terminated in August 2022 and the claim filed in January, 2023 hence within time. 5. This court notes that the Appellant only attached one payslip for April the time it alleged the contract had lapsed which showed that the Respondent was paid overtime and house allowance. The contract of employment provided for basic pay of Kshs 14, 362/= exclusive of house allowance. The trial court used the basic pay in calculation of its dues and awarded the Respondent his house allowance and overtime which were justified. 6. Since the only payslip attached was for April 2022 which does not even reflect the Respondent’s basic pay then the same cannot be relied upon as conclusive evidence and the trial court was justified in awarding the Respondent his dues although the house allowance should be for the 5 months worked not 3. His gross salary could not be discerned necessitating the court to use the known basic pay as per the contracts. 7. As for Henry the trial court based his monthly salary on Kshs 35, 000/ while the contract before the court provided that the basic salary was Kshs 18, 904/= exclusive of house allowance. Instead, the Respondent was entitled to his house allowance since the pay slips provided for unpaid leave, overtime but the house allowance was not corresponding because the basic pay kept changing and were different from the employment contract. 8. The trial court should have relied on the basic pay given in the contract then award the house allowance and severance pay. The amounts in the attached payslips kept changing with the only constant amount being the basic pay as stated above hence the court could not discern the gross pay which is usually used in calculations of dues. 9. As for Wilfred he attached a bank statement which showed he received around Kshs 40,000/= and the gross salary as per the pay slip was Kshs 49, 843/=. The trial court should have used the gross salary in calculation of the terminal dues but it just awarded a lumpsum amount of Kshs 250,000/= despite finding that the Respondent was not entitled to leave pay, house allowance and severance pay since he had not completed one year and the fact that he was paid one-month notice pay. 10. This court notes that the said notice was not one-month salary because it was indicated as 1,890.04/= which cannot be a whole month salary. The Respondent is therefore entitled to one-month notice pay and the one-month compensation for unfair termination. The Appellant alleged that the Respondent’s basic salary was Kshs 21,447/= but courts usually use gross pay where it can be discerned like in this case it was clear the gross salary was Kshs 49,843/=His salary was consolidated and the trial court was justified in not awarding the rest of the prayers sought but erred in relying on Kshs 37,000/= salary without any basis. 11. **In the upshot the Appeal partially succeeds as follows:** **John Wangila Sitati** * + 1. **One-month compensation for unfair termination Kshs 14,362/=** 2. **One-month salary notice pay Kshs 14, 362/=** 3. **5 months house allowance Kshs 10,771.5** **/=** 4. **Overtime Kshs 83,936.10/=** **TOTAL KSHS 123,431.60/=** **Henry Onganyo Ambata** 1. **One-month salary as compensation for unfair termination Kshs 18,904/=** 2. **One-month salary as notice pay Kshs 18, 904/=** 3. **House Allowance 15% of 18,904 x 12 months= Kshs 34,027.2/=** 4. **Severance pay for one year 15 days salary Kshs 9,452/=** **TOTAL KSHS 81,287.20/=** **Wilfred Onkeo Nyabuto** * 1. **One-month salary as compensation for unfair termination Kshs 49,843/=** 2. **One-month Notice pay Kshs 49,843/=** **TOTAL KSHS 99,686/=** 1. **Since the appeal partially succeeds each party share bear their own costs of these appeals.** 2. **It is so ordered.** **Dated at Nairobi this 12th day of August, 2026** **Delivered virtually this 12th day of August 2026** **Abuodha Nelson Jorum** **Presiding Judge-Appeals Division**