https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/524

**REPUBLIC OF KENYA** **IN THE MAGISTRATE COURT OF KENYA AT LAMU COUNTY** **COURT NAME: LAMU MAGISTRATE COURT** **CASE NUMBER: MCELRC/E001/2026** **VITALIS SEHEMU NYAWA VS MAJLIS MANDA ISLAND RESORT LIMITED A.K.A THE** **MAJLIS LAMU LIMITED** **JUDGMENT** 1. This is a claim commenced by way of memorandum of claim dated 18/2/2026 seeking among other orders a declaration that the termination of employment was unprocedural, and seeks compensation for one month salary in lieu of notice, payment of salary for alleged remaining months on the contract from 1/9/2025- 31/1/2026, severance pay for 4 years, maximum compensation for unfair termination and certificate of service and cost and interest. The claim is opposed by the Respondents. 2. At the hearing the claimant testified as the only witness and adopted his witness statement dated 18/2/32026 and produced the documents per his list dated 18/2/206. 3. The Respondent called John Tobiko who testified by adopting his witness statement dated 12/3/2026 and produced the documents filed per the list dated 12/3/2026 4. Both parties have filed written submission which have been considered. 5. It is the case of the claimant that he was employed by the respondent on 14/6/2021 as a waiter on fixed term contract. That he was issued contract of 2/9/2024 and 2/2/2025 which he signed and returned. That on 31/8/2025 his contract was terminated on ground of end of contract. That at the time of termination he was earning Kshs 26,000 monthly wage. 6. The respondent agrees with the claimant that he was indeed employed but the contract ended on 31/8/2025 . They however denied that the claimant was issued a contract on 1/2/2025. 7. The issue for determination is whether the claimant’s employment was illegally terminated or the contract expired, and what orders to issue in the circumstances. 8. I have looked at the pleadings particularly the claimants own written statement and he agreed that he indeed was employed on fixed term the contract which was expiring on 31/8/2025. He was issued a notice of non-renewal of contract. 9. This was a fixed term contract and unless there was any signed renewal agreement there was no contract upon the lapse of the contract ending on 31/8/2025. His employment was of the nature of a fixed term contract. On 20th August, 2025, the Respondent issued a Notice of Non-Renewal which cited the September 2024 contract and confirming it would not be renewed upon its expiry. The Claimant is said to have cleared with departments of the Respondent, and on 1st September, 2025 was paid his final dues of Kshs. 67,688 as net pay through Equity Bank Cheque No. 000443. The respondent indicated that this payment included a pro-rated service pay of Kshs. 55,361, notwithstanding that the contract reserved gratuity for employees who complete five consecutive years of service. That the claimant signed a confirmation of receipt of all monies due and waived any further claim. 10. That the the Respondent also issued him a Certificate of Service dated 31st August 2025. That that claimants contract came terminated by effluxion of time and not termination by action of the Respondents as per Tobiko Nkuraiyia, who testified that the employment contract expired. 11. The Claimant’s allegation of a second contract dated 1/2/2025, running to 31/1/2026 has been disputed. The respondent denied it and pointed out that the said document bears only the Claimant's signature. That the Respondent's part is not executed on any section. The claimant in cross examination stated that he has record to show how he was issued with the alleged documents but did not avail. The burden of proof of its existence. This contravenes Employment Act, 2007 Section 10(3) requires a written contract, where the engagement is not for an indefinite period, to state the date on which it is to end. 12. A fixed term contract is lawful engagement as a term of employment. I concur with the respondent that a fixed term contract by its nature lapses automatically on its expiry date, without need for any further act to lead to its termination. 13. The claimant has not claimed that the fixed term contract came with legitimate expectation of its renewal. In the circumstances the respondent is right to state that under Sections 41, 43 and 45 Employment Act issues of hearing before termination, proof of reason for termination, and unfair termination does not arise in this particular case. 14. The issue as to the relationship between then 1st and 2nd Respondent is therefore a non-issue in view of the nature of the claims and evidence tendered. 15. Under the Evidence Act Cap 80 Sections 107 and 109 the the burden of proving a fact of a new contract, and that it was terminated as alleged by claimant as opposed to expiry rests on the claimant. 16. I find that the September 2024 contract was the only existing agreement between the parties. It lawfully expired as per its own terms on 31st August, 2025. A fixed term contract that has run its course can’t be held as unlawfully and or unfairly terminated upon its expiry. Such fixed term contract expires by effluxion of time. 17. The Respondent Notice of Non-Renewal issued by the Respondents is a good labor practice and not as legal or contractual requirement. The lack of notice, or a notice for the lesser period of 11 days which less than 30 days as claimed by the claimant here can’t be the subject of a claim for payment of salary in lieu of notice. 18. The claimant has not also availed any evidence to show there was any discussion and agreement or contract to renew his fixed term contract. Furthermore, the claimant has not shown any legal or contractual requirement for a meeting to discuss the non-renewal of the fixed term contract . 19. The decision in ***Transparency International Kenya v Teresa Carlo Omondi, Civil Appeal No. 81 of 2018, [2023] KECA 174 (KLR)***, where the Court held that the general principle is that fixed term contracts carry no rights, obligations, or expectations beyond the date of expiry is the law. *“There was no ambiguity created to create an expectation of contract renewal by the appellant’s issuance of a fixed-term contract. The contract terminated automatically when the termination date arrived. Whether a contract with a renewal clause will be extended or not, is an issue that is at the discretion of the employer and it cannot create a legal right under the doctrine of legitimate expectation.”* 20. The claimant maximum compensation claim for alleged unlawful termination of employment lacks legal, factual and contractual basis. 21. I don’t find any need to delve into issue of the discretion of an Employer to renew or not renew a fixed term contract for above reasons. The authorities cited by the claimant including *Njaramba vs Mombasa Water supply and sanitation Co. Ltd 2025 KELRC 2360 , and Mombasa Coffee Ltd vs Shuke 2024 KELRC 444* are not relevant as they delved on issue of unfair termination of employment which is not the case in the current case. 22. It is now clear that the entire claim is unmerited. a) Notice pay - No notice pay arises, because the contract expired on its own terms rather than being terminated. b) Wages for the remaining contract period - This claim rests entirely on the existence of an alleged contract running to 31st January, 2026 which was never executed by the Respondent and creates no obligation on it. There being no remaining contract period to compensate, the claim fails as noted above. c) Severance Pay - Under clause 6 of the Employment Agreement, gratuity is payable only upon completion of five consecutive years of service. The Claimant served four years and three months. Therefore as rightly submitted by Respondent; strictly and contractually he was not entitled to any service pay. He was Kshs. 55,361 on a pro-rated basis, which he accepted and cannot now claim a second payment for what he was not legally entitled. d) Compensation for unfair termination fails in view of all the above. 1. The suit is dismissed with costs to the respondent. Judgment Read, Delivered and Dated at Lamu Law Courts in open court this …13th ....day of …....August ........... 2026 at…9.05.. am **P.W. Wasike** **Principal Magistrate** In the presence of for plaintiff Ms Sidinyu hold brief for Ms Katu for the 1st and 2nd Respondents Ms Wanjema hold brief for Nthusa