https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/1779

**REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT** **AT NAIROBI** *(Before Hon. Lady Justice Monica Mbarũ)* **APPEAL NO. E328 OF 2025** J**ULIUS MULINGE MBOYA APPELLANT** *VERSUS* **ONIK ENTERPRISE LIMITED RESPONDENT** **[Being an appeal against the entire judgment of Hon. Derrick K. Kuto delivered on 5 September 2025 in Mavoko CMELRC No. E216 of 2024]** **JUDGMENT** The appeal arises from the judgment delivered on 5 September 2025 in Mavoko CMELRC No. E216 of 2024. The appellant seeks that the judgment be set aside and substituted with a judgment awarding the appellant terminal dues. The appeal is that the learned magistrate erred in law and fact by dismissing the appellant’s claim with costs, particularly on the issue of terminal benefits, while ignoring evidence adduced by the appellant and the submissions. The trial court ignored and failed to consider the corroborative evidence adduced in support of the appellant’s claim by **Mutua Malui in MC. ELRC No. E217 of 2024.** The trial court erred in failing to find that the appellant had proved, on the required standard, that he was underpaid by the respondent for the entire period of service as a heavy commercial driver. It is thus entitled to salary arrears, including underpayments. The trial court failed to find and appreciate that the appellant was entitled to a claim for service pay due to irregular and inconsistent contributions/ remittance of social security (NSSF) by the respondent. Another ground of appeal is that the learned trial magistrate misdirected himself and thus arrived at a wrong conclusion by failing to assess and tabulate terminal benefits payable to the appellant, particularly underpayments, service, overtime and unpaid leave. The appellant filed his claim before the trial court, alleging that he was employed by the respondent as a heavy commercial driver on 28 April 2021. He was paid Ksh 22,000 per month without any other benefits, and his salary was below the minimum wages set by the Wages Orders. He was verbally dismissed from employment on 22 December 2023 and was not issued with any termination letter or given any reasons. The claim was that the termination of employment was unlawful for want of substantive justification or procedural fairness. The respondent has also failed to tabulate and pay his terminal dues. The appellant claimed the following: 1. Notice pay Ksh. 37,122. 2. Service pay Ksh. 57,824. 3. Salary underpayments for 14 months Ksh. 211,708. 4. Overtime for 3 hours per day Ksh. 267,706. 5. 5 Accrued leave days Ksh. 7,765. 6. 12 months' compensation Ksh. 445,464. 7. Certificate of service. 8. Costs of the suit. In response, the respondent denied the claims, asserting that the appellant was employed as a driver with his last contract from 3 January 2023 to 31 December 2023. The appellant was neither a heavy commercial driver nor entitled to a salary of Ksh 37,122. The appellant’s last employment contract was entered into on 3 January 2023, and it automatically terminated on 31 December 2023, as expressly stated in the contract. On 21 December 2023, the appellant and other employees were allowed to proceed on the Christmas holiday, and this cannot be termed a termination of employment, as employment terminated on 31 December 2023. The appellant was not entitled to any of the benefits listed. The Respondent asked that the claim be dismissed with costs. The learned magistrate assessed the evidence and held that a fixed-term contract governed the appellant’s employment. Such contracts are permissible at law and terminate upon expiry of the agreed term, without any action required from either party. The Respondent’s evidence that the company closed for the Christmas holiday on 21 December 2023 and released its employees was a plausible explanation for why the appellant ceased working on that date and does not, in itself, constitute termination. The burden of proof rested with the appellant under section 47 (5) of the Employment Act (the Act). The appellant alleged unfair termination but provided insufficient evidence to establish, on the balance of probabilities, that he was dismissed before the expiry of his contract. The appellant has not taken issue with this finding in the appeal or in the submissions. On the contentious issues as to whether the appellant was employed as a commercial driver and was underpaid as per the applicable Wages Orders, the court held that the parole evidence rule dictates that where contract is in writing, extrinsic evidence cannot be admitted to add to, vary or contradict its terms and the court is bound by the written contract and pay slips adduced in court showing the agreed salary of ksh 22,000. The claim for service pay did not arise because there was no evidence of NSSF contributions. The court dismissed the claim for overtime and leave days, holding that the appellant failed to discharge the burden of proof. The court dismissed the claim with costs. On appeal, the appellant submitted that section 10(7) of the Act places the burden of proving or disproving an alleged term of employment on the employer, as held in **Reuben Lucheleli Shikuri v Eldoret Packers Ltd [2015] KEELRC 1369 KLR.** The employer failedto discharge the burden of proof and could have produced the logbook to disprove that the appellant was a commercial driver. The learned magistrate thus erred in law and failed to find that the appellant had proved, on the balance of probabilities, that he was a heavy commercial driver and entitled to terminal dues. On the reliefs, on the salary underpayments, the appellant contended that he produced his pays slip that showed him earning Ksh 22,000 from April 2022 to June 2023, a sum of Ksh 27,273 from July 2023 per month despite being designated as a heavy commercial vehicle driver whose gazetted minimum wage under the Regulation of Wages (General) (Amendment) (Order), 2022 and 2023 within Mavoko was a gross pay of Ksh. 37,122. The appellant submitted that the respondent did not controvert the claim to leave by way of production of the leave records as held in **Victor Sendeu Omwenga v General Timothy Misiani Orwenjo t/a GMT Service [2019] eKLR.** On the service pay, the appellant submits that the respondent's NSSF contributions were erratic, and the appellant’s records show that the respondent did not make any NSSF contributions. From April 2022 to June 2023, for a total of 15 months. In **Elijah Kipkoros Tonui v Ngara Opticians T/A Bright Eyes Limited [2014] e KLR,** the court held that where the NSSF contributions appear to confer inferior social security benefits, the Court is inclined to order that the employee be paid service pay, less any remittances made to NSSF. The appellant submitted that the absence of employment records produced by the respondent to counter his claim on overtime means that the claim by the appellant is to be taken as the true position. In failing to order the issuance of a certificate of service, the learned magistrate fell into error under section 51 of the Act, as held in **Angela Wokabi Muoki v Tribe Hotel Limited [2016] eKLR,** where the respondent was ordered to pay the employee Ksh. 100,000/ after the respondent willfully failed to comply with the mandatory provisions of section 51 of the Employment Act. The appellant submitted that, as to the costs of the appeal before the subordinate court, it is a well-established principle that costs follow the event and are awarded to the successful party. The respondent was served with a demand notice but failed to pay the appellant his dues. There are no submissions on record on behalf of the respondent. **Determination** As this is a first appeal, the court is entitled to review the record, reassess the findings and draw its own conclusions. However, the trial court had the opportunity to hear the witnesses and draw inferences from the evidence. The appellant asserts that the respondent employed him as a heavy commercial driver and that he was underpaid. His employment was terminated without due process, and the trial court erred in failing to assess his claims on the merits. The respondent did not file any written submission. However, in reply to the claim before the trial court, the claims were denied, and various work records, including the employment contract dated 3 January 2023 and ending 31 December 2023, were filed. Under the employment contract, the appellant accepted it and executed it in acknowledgement of the terms and conditions thereof. He was employed as a driver at a gross salary of Ksh. 22,000 per month. The respondent attached payment statements indicating that the appellant was earning a gross wage of Ksh. 27,273.63, which included basic pay and a house allowance. There are statutory deductions. Indeed, the law allows parties in an employment relationship to enter into a fixed-term contract with a start and end date. Section 10(3) of the Act permits parties to have a fixed-term contract. Under such a contract, once the start and end dates are agreed, there is no obligation to issue notice of non-renewal or termination, since this is already addressed. In **Nyaanga v Cabinet Secretary, Ministry of Labour & Social Protection & 2 others [2026] KECA 1107 (KLR)**, the court held that a fixed-term contract terminates automatically. There is no duty to issue notice. In **Gathimba v Kirinyaga Water & Sanitation Company [2026] KECA 1066 (KLR),** the court held that a fixed-term contract does not carry any rights, obligations or expectations beyond the date of expiry, and that where a contract of employment comes to an end by effluxion of time, a claim for wrongful termination cannot be sustained. In such a case, the provisions of sections 41 and 43 of the Act do not apply, since the parties have already addressed the start and end dates of the employment relationship. In this regard, the learned magistrate correctly applied the law and made correct findings. The fixed-term contract bound the parties in this case. It covered the period from 3 January to 31 December 2023. After the appellant took the Christmas break, there was no obligation to return to the shop floor. Notice pay and compensation claims are not justified. With regard to the position held by the appellant, under his fixed-term contract, he was defined as a driver. This position is fundamentally different from that of a heavy commercial driver. However, the position of driver is regulated under the Wages Orders. Even that of a heavy commercial driver is regulated. In this case, as a driver employed at Mavoko, the monthly wages for January to December 2023 total Ksh. 18,936.85, plus a 15% house allowance of Ksh. 2,840.55, for a gross wage of Ksh. 21,777.35. Even for a larger vehicle that is not a heavy commercial, the basic wage in January 2023 is Ksh. 23,716.20, plus the house allowance of Ksh. 3,557.43, for a gross total of Ksh. 27,273.63. The applicant, as a driver, was earning a gross wage of Ksh. 27,273.63, which aligns with a driver's position. The finding is that the written contract for regulated employment binds parties, and the Wages Orders guide this. In any position where the Minister has issued Wages Orders and defined the parameters of the terms and conditions of service, the employer cannot go below the minimum threshold set out therein. The freedom of contracting in an employment relationship is thus regulated. In this case, there was no underpayment as alleged. Under his written contract, the appellant held a defined position as a driver and was paid in accordance with the Wages Orders. Regarding overtime, these claims were left bare. The claims were not particularised as to how they accrued. The learned magistrate analysed the evidence and made correct findings. Regarding the outstanding 5 leave days, the employee has a right to take annual leave days under section 28 of the Act. Upon filing his claim, the respondent, as the employer, should have filed the work records showing how the due leave days were allocated. Without the necessary records as required under section 10(6) and (7) of the Act, the claim for 5 days KSh. 7,765 is justified. There is a claim for service pay on the grounds of intermittent remittances to NSSF. The payment statement filed by the respondent indicates statutory dues deductions, obligations or expectations beyond the date of expiry, and that where a contract of employment comes to an end by effluxion of time, a claim for wrongful termination cannot be sustained. It was the respondent’s position that, as held by the ELRC, sections 41 and 43 of the Employment Act had no application in the circumstances of this case. Turning to the second issue on remedies, the respondent submitted that, having failed to prove that his employment was wrongfully or unlawfully terminated, the appellant was not entitled to the remedies he sought. The respondent further submitted that, having served three months’ notice of intention to terminate the contract with the appellant, there was no basis for payment of three months’ salary in lieu of notice as claimed by the appellant. As regards the underpayment alleged by the appellant, the respondent submitted that, under the Human Resource Policy and Procedure Manual (HR Manual), Salary increments were to be effected by a resolution of the Board of Directors, which was not done. On mileage and telephone service, pay is not prorated. With alleged intermittent remittances, the penalty due is for the respondent to address, and payment of service pay is not due. Under section 51 of the Act, a Certificate of Service is due to the employee at the end of employment, whatever the reason. Under his fixed-term contract, the applicant was entitled to a Certificate of Service. This should be issued. Regarding costs, the appeal, as analysed above, is without merit, save for the due 5 leave days. No costs are due. **Accordingly, judgment in Mavoko MCELRC No. E216 of 2024 is confirmed, and the appeal is dismissed, save for payment of 5 leave days at Ksh. 7,765. Each party to bear its costs for the appeal. Costs for the trial court as awarded.** **Delivered in open court this 29th day of June 2026** **M. MBARŨ** **JUDGE** **In the presence of:** **Court Assistant: Samuel Maruga** **………………………………….…… and ……………………………………..…**