https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/2115

**REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT AT ELDORET** **CAUSE NO. E043 OF 2025** *(Before Hon. Lady Justice Maureen Onyango)* **DEWARTS ALEX OTIENO…………..…..........................CLAIMANT** **VERSUS** **SAVORY AGENCIES LIMITED…………………......1ST RESPONDENT** **THOMAS KIPROTICH TALAM..........................2ND RESPONDENT** **JUDGMENT** 1. The Claimant describes himself as a former employee of the Respondents in his Memorandum of Claim. The 1st Respondent is a limited liability company while the 2nd Respondent is described as the 1st Respondent’s sole director. 2. The Claimant avers that he was employed by the 1st Respondent to work as operations/ICT manager at Webuye Weighbridge Station from 13th February 2025 with a monthly salary of Kshs. 250,000. 3. He avers that it was a term of the agreement that the contract would run for a period of 28 months. 4. The Claimant contends that before entering into the employment contract with the Respondent, he had entered into a pre-contractual agreement for the acquisition of the tender for Webuye weighbridge management which entailed preparation of tender documents, facilitation of the tender process, procuring of stationaries and printer for the tender process. 5. The Claimant avers that it was an express term of the parties' agreement that he would be reimbursed for expenses incurred in the course of facilitating the tender process. He contends that he expended a total sum of Kshs. 270,000 towards the tender exercise, including the procurement of stationery and printers required for the preparation and submission of the tender documents. The Claimant further avers that despite the said expenditure having been incurred for the benefit of the Respondents, he had not been reimbursed and the amount remained outstanding. 6. The Claimant avers that throughout his engagement with the Respondent, he performed his duties diligently and faithfully and that his performance met the Respondent's expectations. 7. He further avers that throughout the period of his employment, he was never issued with he never received any warning, complaint or adverse report, either formal or informal, regarding his performance, conduct or capacity to undertake the responsibilities assigned to him, nor subjected to any disciplinary process by the Respondents. 8. The Claimant stated that on 18th March 2025, he received a telephone call from the 2nd Respondent, who informed him that the Respondents had resolved to establish an office in Nairobi from which their operations would be conducted. 9. According to the Claimant, the 2nd Respondent requested him to relocate to Nairobi for purposes of identifying suitable office premises and to report back upon securing an appropriate office space to facilitate the establishment of the Respondents' Nairobi office. The Claimant avers that he complied with those instructions and travelled to Nairobi, where he commenced the search for suitable office premises. He stated that upon identifying an appropriate office space, he informed the 2nd Respondent accordingly. However, to his surprise, the 2nd Respondent informed him that his position had been filled by another person engaged by the Respondents and further indicated that he would communicate the way forward regarding the Claimant's employment. The Claimant avers that no further communication was received from the 2nd Respondent thereafter. 10. The Claimant contends that the Respondents breached both the express and implied terms of his contract of employment in that:- 11. He had no disciplinary or performance-related issues and had consistently discharged his duties satisfactorily to the Respondents' knowledge 12. He was never issued with a warning letter, suspended from duty or subjected to any form of investigation concerning his conduct or performance 13. He was not accorded a fair hearing or afforded an opportunity to respond to any allegations against him prior to the termination of his employment 14. No due process was followed before the Respondents arrived at the decision to terminate his employment, resulting in his being treated in an unfair, degrading and undignified manner 15. He had not breached any term of his contract of employment that would warrant the termination of his employment 16. He was not served with a notice to show cause as required under the Employment Act and the terms of his contract 17. He was never informed of the reasons for the termination of his employment as required by law 18. The Respondents acted hastily and without due regard to his rights and legitimate expectations as an employee 19. The Respondents disregarded the procedural safeguards prescribed by law in effecting the termination 20. The Respondents unlawfully, unfairly and wrongfully terminated his employment without lawful justification. 21. Consequently, the Claimant sought the following reliefs: - 22. Pay in lieu of notice ………………………….… Kshs. 250,000 23. Damages for wrongful termination ……….... Kshs. 600,000 24. Salaries for the remainder of the contract … Kshs. 6,750,000 25. Salary due for 18 days …………………….….. Kshs. 150,000 26. A refund of Kshs. 270,000 being costs incurred in procuring the tender 27. Leave days for 1 year prescribed in the Employment Act 28. General damages 29. Interests on a, b, c, d and e at court rates from the day each payment fell due and payable until payment in full. 30. Certificate of service 31. Costs of this suit 32. Any other relief that this Honourable Court may deem fit and just to grant. 33. The Respondents filed their Statement of Response dated 31st October 2025 and denied that the Claimant was ever employed by the 1st Respondent in any capacity. They averred that no formal or informal offer of employment was ever made to the Claimant and that the Claimant never executed any contract of employment with the 1st Respondent. 34. The Respondents averred that the only relationship that existed between the parties was a consultancy arrangement pursuant to which the Claimant, together with other consultants, provided professional services to assist the 1st Respondent in meeting the eligibility requirements for a tender floated by the Kenya National Highways Authority (KeNHA) for the management, operation and maintenance of the Webuye Weighbridge Station. According to the Respondents, the engagement was limited to the tendering and pre-implementation phases of the project and did not constitute or give rise to a contract of employment between the parties. 35. The Respondents further averred that, as a result of the consultancy services rendered, the 1st Respondent successfully secured KeNHA Contract No. KeNHA/WB/MTCE/4341/2025. They maintained that it was agreed that, owing to budgetary constraints at the commencement of the project, the consultants, including the Claimant, would be compensated once the 1st Respondent began receiving payments under the contract. 36. The Respondents further averred that all expenses incurred in connection with the tender process, including the amounts allegedly expended by the Claimant in facilitating the tender, were to be settled upon the conclusion of ongoing discussions regarding consultancy payments. They maintained that the said discussions, in which the Claimant continued to participate, were still ongoing and that a settlement was anticipated upon their conclusion. 37. The Respondents reiterated that the Claimant was engaged as a consultant for a limited and specific purpose, namely to facilitate the preparation and submission of tender documentation, including the sourcing of stationery and printing materials required for the tender process. According to the Respondents, the engagement was task-specific and time-bound, and the Claimant operated independently, determining his own methods of work, schedule and deliverables. They maintained that he was not subject to the control, direction or supervision ordinarily associated with an employment relationship. 38. The Respondents averred that following the award of the KeNHA contract, the 1st Respondent was required to propose key personnel for approval by KeNHA, including the position of Operations/ICT Manager. It is contended that the Claimant's name was among those proposed following an internal interview process conducted by the 1st Respondent. 39. The Respondents further averred that Clause 5.10.1 of the Terms of Reference forming part of the KeNHA contract vested the authority to approve all proposed personnel exclusively, that KeNHA was mandated to assess their qualifications and suitability. They contended that the said clause further provided that any person previously dismissed from KeNHA weighbridge facilities on account of integrity or disciplinary concerns would not be eligible for approval. 40. According to the Respondents, the 1st Respondent submitted the names of various candidates, including the Claimant, to KeNHA for evaluation and approval after which process, KeNHA approved Mr. Seth Rasugu Ongwae for the position and declined to approve the Claimant. 41. The Respondents averred that the 1st Respondent lacked the authority to appoint or confirm the Claimant to the position in the absence of KeNHA's written approval and that any such appointment would have constituted a breach of the contractual obligations owed to KeNHA, thereby exposing the 1st Respondent to sanctions, including possible disqualification under the contract. 42. The Respondents further averred that notwithstanding the foregoing, the Claimant proceeded to assume duties at the weighbridge station without authorization and outside the scope of the consultancy arrangement. According to the Respondents, KeNHA promptly raised concerns regarding the Claimant's involvement, noting that he had not been approved for the position and directing that only duly approved personnel be retained. KeNHA consequently confirmed the appointment of Mr. Seth Rasugu Ongwae as the Operations Manager. 43. The Respondents further averred that although the Claimant undertook certain duties outside the scope of the consultancy arrangement, the 1st Respondent, acting in good faith, made a one-off payment to him in respect of the days worked. They denied that the payment constituted salary and contended that the Claimant had mischaracterized the payment as evidence of an employment relationship. 44. The Respondents maintained that they subsequently sought reconsideration of the Claimant's proposed appointment by KeNHA but KeNHA maintained its position and declined to grant approval. They contended that the Claimant was fully aware that any appointment was contingent upon KeNHA's approval and that no employment relationship could arise in the absence of such approval. 45. The Respondents further averred that had the Claimant been an employee of the 1st Respondent, any appointment, termination or replacement relating to his position would have required the prior approval of KeNHA pursuant to Clause 4.2 of the principal contract. They contended that the Claimant had not produced any correspondence, approval or communication from KeNHA recognizing him as an employee of the 1st Respondent or relating to the alleged termination of his employment. 46. The Respondents reiterated that discussions regarding consultancy fees payable to the consultants, including the Claimant, remained ongoing and that the Claimant continued to participate in those discussions notwithstanding his assertion that he was an employee of the 1st Respondent. 47. The Respondents maintained that no contract of service existed between the parties capable of attracting the provisions of the Employment Act. They averred that the Claimant had no formal appointment capable of termination and that, consequently, no dismissal, whether actual, constructive or otherwise, could be inferred between the Claimant and the Respondents. 48. The Respondents further averred that in the absence of an employment relationship, no disciplinary process or procedural safeguards under the Employment Act were triggered. Accordingly, they denied any liability for notice pay, terminal dues, compensation for unfair termination or any other remedies available under the Employment Act. 49. The Respondents further averred that the text message relied upon by the Claimant and allegedly sent by one Libra Mutinda did not constitute an offer of employment or a representation capable of binding the 1st Respondent. According to the Respondents, the said Libra Mutinda was neither an employee, agent nor authorized representative of the 1st Respondent but was herself an applicant for the position of Human Resource Officer at the material time. Consequently, any communication emanating from her could not establish an employment relationship between the parties. 50. The Respondents further averred that they were strangers to the Claimant's allegation that he resigned from previous employment in anticipation of joining the 1st Respondent. They maintained that no offer of employment or appointment was ever made to the Claimant and that any decision concerning his prior employment was made independently and without the involvement of the Respondents. They therefore denied any responsibility for the Claimant's alleged inability to secure alternative employment. 51. The Respondents denied that the Claimant was entitled to any of the reliefs sought as they were based on the existence of an employment relationship, which they maintained did not exist. 52. The court was urged to dismiss the Claimant's suit with costs. **The Evidence** 1. The case was heard on 4th February 2026 when the Claimant testified on his behalf as CW1 and called Angeline Achieng Odondi who testified as CW2 while the 1st Respondent testified as RW1 on 16th February 2026. 2. The Claimant adopted his witness statement as his evidence in chief and produced the documents filed together with the Memorandum of Claim. He testified that his pre-contractual consultancy engagement with the 1st Respondent came to an end in December 2024. Thereafter, he applied for the position of operations/ICT manager following an advertisement, attended an interview and subsequently received a text message from the Human Resource Officer directing him to report to work in February 2025. He stated that deductions were made from his salary and that he had not been paid monies due to him under the pre-contractual arrangement. It was his evidence that his employment was not terminated in accordance with the law and that he was entitled to the reliefs sought in the claim. 3. Upon cross-examination, the Claimant testified that he participated in a pre-contractual arrangement with a team of individuals who assisted the 1st Respondent in preparing documents for the tender process. He stated that he was actively involved in the tender process and was familiar with the details of the contract between KeNHA and the 1st Respondent. He testified that he was unaware that KeNHA had the final authority to approve key personnel under the contract. He further stated that, as part of the consultancy team, he participated in proposing names for various positions. He further testified that he accessed the interview report by virtue of his involvement with the 1st Respondent. 4. The Claimant further testified that he resigned from his previous employment after receiving an offer from the 1st Respondent. He stated that employment contracts were issued to the employees engaged together with him on 15th February 2025, approximately nine months later, after his employment had already been terminated. He conceded that he did not sign any written contract with the 1st Respondent. He testified that Mutinda Libra was the Human Resource Officer of the 1st Respondent and that she participated in the recruitment process. According to the Claimant, she joined the company after the award of the tender. He produced a staff payroll and testified that his monthly salary was Kshs.125,000. He acknowledged that although the Memorandum of Claim pleaded a salary of Kshs.250,000 per month, the payment reflected in the payroll related to the month of February 2025 when he had worked for only part of the month. 5. Upon re-examination, the Claimant maintained that the 1st Respondent was his employer and that the payment made to him in February 2025 constituted salary for services rendered. He further testified that the contract was intended to run for a period of twenty-eight months and that the position of Operations Manager was to subsist for the duration of the project. 6. Angeline Achieng Odondi testified as CW2 and adopted her witness statement dated 8th January 2026 as her evidence in chief. She testified that she was an employee of the 1st Respondent and that she met the Claimant during the preparation of the tender documents. She stated that she worked as a computer operator and that one Seth Rasungu joined the 1st Respondent after the Claimant had left. 7. During cross-examination, CW2 testified that she was employed by the Respondents in February 2025 and was involved in the preparation of the tender documents. She stated that the Claimant was an employee of the Respondents and that, to her knowledge, he received salary from the company. 8. Upon re-examination, CW2 testified that she received half salary for the month of February 2025. She further stated that the Claimant served as the Operations Manager. 9. For the Respondents, RW1, the 2nd Respondent, adopted his witness statement dated 24th November 2025 as his evidence in chief and relied on the documents filed on behalf of the Respondents. He testified that the Claimant served as a consultant during the bid and tendering process relating to the contract between the 1st Respondent and KeNHA. According to RW1, the consultancy engagement encompassed the bid process, tender preparation and oversight of the implementation phase of the contract. He stated that the Claimant assisted in the preparation of staff positions and employment contracts and also provided advice on contractual matters. RW1 further testified that the tender requirements obligated the 1st Respondent to submit the names of key personnel to KeNHA for approval and that KeNHA retained the final authority to approve such personnel. He added that the contract expressly provided that all key employees were subject to the client's approval. 10. Upon cross-examination, RW1 testified that the tender process commenced in October 2024 and was concluded in December 2024. He stated that following the award of the tender, the Claimant continued working on the project and was retained as a consultant, although no written contract existed to formalize that arrangement. He further testified that the Claimant was based in Nairobi while undertaking duties connected to the Webuye project. 11. According to RW1, part of the monies due to the Claimant had been paid, while a balance remained outstanding. He maintained that the consultancy arrangement related both to the bid process and the subsequent contract with KeNHA. 12. RW1 further testified that approval by KeNHA was mandatory in respect of all key personnel and that employees of the 1st Respondent were paid through the company's accountant. When referred to the bank statement appearing at page 37 of the Claimant's bundle, RW1 acknowledged that the payment made to the Claimant was described as salary. He however maintained that the payment represented consultancy fees for implementation work undertaken by the Claimant and explained that the description had been inserted by the accountant. He further testified that consultants were remunerated for various services rendered and that the consultancy agreement dated August 2025 was intended to facilitate payment of consultants. According to RW1, some consultants had been paid while others were yet to receive payment. 13. RW1 further testified that the approval of Seth Ongwae as Operations Manager was granted by KeNHA after all proposed names had been submitted for consideration. He stated that the handover process was undertaken on 15th February 2025 and that the handover documents identified Seth Ongwae as the Operations Manager. He nevertheless acknowledged that the Claimant signed the handover documents as Operations Manager. 14. Upon re-examination, RW1 testified that the consultancy engagement was tied to the consultancy phase of the contract and was intended to subsist for the duration of the consultancy period, which he stated was eighteen months. 15. At the close of Respondents’ case, parties were directed to file written submissions. The Claimant’s written submission are dated 1st April 2026 while the Respondents submissions are 25th April 2026. **DETERMINATION** 1. From the pleadings, the evidence before court, the submissions of the parties and the authorities cited therein, the issues for determination are: - 2. Whether the Claimant was an Employee of the 1st Respondent 3. Whether the Claimant's Employment was Unfairly Terminated 4. What reliefs should issue? *Whether the Claimant was an Employee of the 1st Respondent* 1. The Respondents' primary defence is that the Claimant was never their employee but was instead engaged as a consultant during the tendering and pre-implementation stages of the project. 2. The evidence on record show that the Claimant participated in the tendering process that culminated in the award of the contract to the 1st Respondent. From the record, it is also clear that following the award of the tender, the Claimant underwent an interview and was informed that he was successful and had been engaged in the position of Operations/ICT Manager. He subsequently reported to the project site where he commenced performance of his duties as an employee of the 1st Respondent. 3. Among the documents produced in court by the parties is the interview report dated 12th February 2025 in which the Claimant was considered for the position of Operations Manager. The Court has also considered the deployment letter dated 17th February 2025 relating to the deployment of key staff to the project, wherein the position of Operations Manager is expressly identified. 4. Further, in the list of the 1st Respondent’s staff members in the Claimant’s bundle of documents, the name of the Claimant appears as Staff number 100164 and is indicated as earning a gross monthly salary of Kshs.125,000 for the month for February, 2025. Also among the documents on record is a letter dated 18th February, 2025 from the 1st Respondent signed by the 2nd Respondent in his capacity as Managing Director addressed. The letter is addressed to the Resident Engineer Axle Load Enforcement, Kenya National Highways Authority (KENHA). In the letter it is communicated that the Claimant had been selected for the position of Operations Manager and it is proposed therein that the Claimant’s appointment be approved by KENHA for the position. 5. It is therefore my considered view that the interview report, deployment documentation, payroll records and evidence of payment by the 1st Respondent lends considerable credence to the Claimant's contention that he had been recruited into the Respondents' workforce following the award of the tender. These documents demonstrate a degree of integration into the Respondents' organizational structure that is ordinarily associated with an employment relationship rather than an independent consultancy arrangement. 6. While the Respondents contended that the Claimant's appointment remained subject to approval by the contracting authority, the evidence before the Court demonstrates that the Claimant had already reported to work and had been assigned an employee number, had been placed on the staff establishment and had commenced rendering services on behalf of the 1st Respondent. The Court is therefore unable to accept the proposition taken by the Respondents that the Claimant remained a consultant throughout the material period. 7. The Court is therefore satisfied that an employment relationship existed between the Claimant and the 1st Respondent. *Whether the Claimant's Employment was unfairly terminated* 1. The Claimant's evidence was that on 18th March 2025, he received a telephone call from the 2nd Respondent instructing him to travel to Nairobi to identify suitable office premises for the Respondents' operations. According to the Claimant, after identifying and reporting on a suitable office space, he was informed that his position had been filled by another person and that he would be advised on the way forward. He averred that no further communication was subsequently received from the Respondents. 2. The Respondents did not dispute that the Claimant ceased working for them in the manner stated by the Claimant. Their defence was that no employment relationship existed and that the Claimant had been a consultant whose proposed appointment had not been approved by KeNHA. 3. It was the Claimant’s position that the Respondents did not prove the existence of a notice to show cause, invitation to a disciplinary hearing, minutes of a disciplinary hearing, termination letter or any other evidence demonstrating compliance with the mandatory provisions for termination of employment under the Employment Act. 4. The Respondents' on the other hand contend that the Claimant's appointment was subject to approval by KeNHA and that such approval was not forthcoming. 5. Even assuming that KeNHA declined to approve the Claimant for deployment as Operations Manager, that can only constitute a reason affecting his continued engagement. It did not absolve the Respondents from complying with the procedural safeguards prescribed under the Employment Act before bringing the employment relationship to an end. 6. The Court further notes that the Respondents had already subjected the Claimant to an interview process, assigned him an employee number, included him in their staff establishment, deployed him to the project and remunerated him for services rendered. Having engaged the Claimant as an employee, the Respondents could not thereafter dispense with his services without adhering to the statutory requirements governing termination of employment. 7. In the circumstances, the Court finds that the Respondents failed to communicate to the Claimant the reason for the termination of the Claimant's employment as required under the Employment Act. The Court further finds that the Respondents failed to comply with the mandatory procedural requirements set out in Section 41 of the Act. 8. Accordingly, I find and hold that the termination of the Claimant's employment was both substantively and procedurally unfair. *What reliefs should issue?* 1. On the prayers by the Claimant, I find the Claimant is entitled to pay in lieu of notice having found that he was terminated from employment unfairly. It is not contested that the Respondent commenced the operations at the contract site on 15th February, 2025. For that month the Claimant was paid Kshs.125,000. I therefore find the Claimant’s averment that the full month salary was Kshs. 250,000 acceptable and adopt the same for purposes of the reliefs payable to the Claimant. I accordingly award the Claimant Kshs. 250,000 on account of pay in lieu of notice. 2. On the prayer for compensation for unfair termination, the Court has considered the short duration of the employment relationship, the circumstances leading to the termination and the conduct of the parties including all relevant factors under section 49(4) of the Act. The Court is satisfied that an award equivalent to three months' gross salary would constitute fair compensation within the meaning of Section 49 of the Employment Act. I accordingly award the Claimant Kshs. 750,000 as compensation. 3. With regard to the Claimant's claim for salary for the remainder of the alleged twenty-eight-month contract, the general principle in employment law is that damages for unfair termination are governed by the Employment Act which does not recognize payment for the unexpired period of a contract, save in exceptional circumstances, such as where the contract specifically provides for salaries that would have been earned for the remainder of a fixed-term contract. The claim under this head is therefore declined. 4. The Claimant also sought reimbursement of Kshs.270,000 allegedly incurred in facilitating the tender process, including expenditure on stationery, printing materials and other requirements necessary for preparation and submission of the tender documents. In support of this claim, the Claimant produced correspondence between himself and the 1st Respondent’s Director, which demonstrates that he consistently sought reimbursement of the said expenses from the Respondents following the award of the tender I have further considered the Respondents' pleadings and evidence. 5. While the Respondents disputed the existence of an employment relationship, they nevertheless acknowledged that the Claimant participated in the tender process and that discussions concerning consultancy payments and expenses incurred during the tender exercise were ongoing. On a balance of probabilities, I find that the Claimant incurred expenses in furtherance of the Respondents' bid for the tender and that the Respondents assumed responsibility for reimbursing the same upon successful award and implementation of the contract. The claim for reimbursement is consequently proved. 6. Accordingly, the awards the Claimant Kshs. 270,000 being reimbursement of expenses incurred in facilitating the tender process. 7. The Court further finds that the Claimant is entitled to a certificate of service in accordance with Section 51 of the Employment Act, having worked for the Respondents for more than 4 weeks. 8. Consequently, judgment is hereby entered for the Claimant against the Respondents as follows: 9. One month's salary in lieu of notice ................ Kshs. 250,000 10. Compensation for unfair termination equivalent to 3 months' salary ........................................................... Kshs. 750,000 11. Reimbursement of tender expenses ……..…… Kshs 270,000 Total .......................................................... Kshs. 1,270,000 1. The Respondents are directed to issue a Certificate of service to the Claimant. 2. The Claimant is awarded Ccsts of the suit and interest at court rates from the date of judgment until payment in full. 3. Orders accordingly. **DATED, SIGNED AND DELIVERED ON** **THIS 19TH DAY OF JUNE, 2026** **MAUREEN ONYANGO** **JUDGE**