https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/1553

**REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT** **AT MOMBASA** **CIVIL APPEAL NO: E133 OF 2025** **TARMAL WIRE PRODUCTS LIMITED …………..APPELLANT** **VERSUS** **BENARD OHINDO ONGALA……………………………RESPONDENT** ***[Being an appeal from the judgment of the Honourable Kalo delivered on the 8th July 2025 in the Chief Magistrate's Court, ELRC E 328 OF 2023]*** **JUDGMENT** 1. Claiming that at all material times, he was an employee of the Appellant, the Respondent initiated legal proceedings against the Appellant under the forestate suit, claiming compensatory and declaratory reliefs. An order that the Respondent issue a certificate of service to the Claimant. 2. The Appellant challenged the Respondent’s claim in the Memorandum of Response dated 5th July, 2023, alleging that at all material times the Respondent was employed under various fixed-term contracts and that his employment terminated by effluxion of time of the last contract under which he served. 3. Upon hearing the arguments presented by the parties regarding their respective cases, the trial Court concluded that the Respondent was not employed under fixed-term contracts, as claimed by the Appellant. Consequently, the Respondent’s employment was not terminated due to the expiration of a contractual period but was instead terminated at the initiative of the Appellant, in a manner deemed unfair. 4. Pursuant to this Court’s directions, the appeal herein was canvassed by way of written submissions. The parties’ respective submissions are on record for this Court’s consideration. **Respondent’s case** 1. It was the Respondent’s case that he was employed by the Appellant, Tarmal Wire Products Limited, in January 2014 as a barbed wire operator, earning Kshs. 9,664.00 per month. He stated that, despite repeatedly requesting one, he was never issued a written contract of employment. He maintained that he served the Appellant diligently for about four years and never received any oral or written warning during his service. 2. The Respondent stated that on 4th April 2023, while on duty, he and four other employees, namely Sammy, James, Juma, and Omondi, were summoned to the Operations Manager's office, Mr. Osman. They were informed of a shortage of work, directed to return their uniforms and go home, and assured that they would be contacted if work became available. 3. The Respondent claimed that after one week with no contact, he went back to work to check on his employment status but was denied entry without explanation. He also mentioned that when he filed a complaint through his legal representatives, the Appellant falsely stated that his contract ended on April 3rd, 2023. 4. The Respondent therefore contended that his termination was unlawful and unfair, and that the Appellant had refused to pay his terminal dues despite demand and notice of intention to sue. He sought salary in lieu of notice, unpaid leave, underpayment, house allowance, severance pay, gratuity, compensation for unlawful termination, a certificate of service, costs and interest, totalling Kshs. 1, 049,035.88. **Appellant’s case in the lower court** 1. It was the Appellant’s case, through the evidence of Osman Yakub, that the Respondent was first employed in the year 2016, as a general labourer, under a fixed -term contract. After the initial contract expired, he served under various fixed-term contracts, with his last running from 24th March 2023 to 24th April 2023. The Appellant stated that the Respondent worked at its Mazeras yard within Kilifi County and earned a consolidated monthly salary of KShs. 10, 824, which included house allowance. 2. The Appellant further denied that the Respondent’s employment was unfairly terminated. Its position was that the Respondent’s last fixed-term contract naturally expired by effluxion of time on 24th April 2023, thereby bringing the employment relationship to an end. He never worked beyond this appointed date. 3. The Appellant contended that in the circumstances of the matter, the Respondent was not entitled to the remedies that he had sought, considering that he had no cause of action against it. **Judgement** 1. In its Judgment dated as hereinabove stated, the trial court found that the Appellant did not prove that at all material times, the Respondent was in its employment under fixed term contracts, and that his employment came to termination when the last contract under which he served expired. He consequently held that the Respondent’s employment was unfairly terminated by the Appellant, and granted him relief under the various heads of his claim. 2. He was awarded one month’s salary in lieu of notice at Kshs. 15,201.65, unpaid leave limited to three years at Kshs. 45,603, house allowance limited to three years at Kshs. 82,080.90, and eight months’ salary as compensation for unfair termination at Kshs. 121,613.20. **Appeal** 1. Dissatisfied with the decision, the Appellant filed this appeal on the following grounds; 2. THAT the Learned Magistrate erred in law and in fact in entering judgment for the Respondent against the Appellant. 3. THAT the learned magistrate erred in law and in fact in finding and ordering that the Respondent was entitled to; 1. Notice pay 2. Leave pay 3. Damages for unfair termination 4. Cost of suit and interest 4. THAT the learned magistrate erred in failing to appreciate and/or consider the pleadings filed and the documentary evidence placed before him, thereby arriving at a wrong conclusion, particularly as regards the determination of the Respondent's employment. 5. THAT the learned magistrate erred in law and fact in failing to appreciate the duty /burden imposed on the Respondent under section 47(5) of the Employment Act 2007. **Appellant’s submissions** 1. The Appellant contends that, as the first appellate court, the Court is mandated to re-assess the evidence on record and to arrive at its own conclusion, citing the case **Rose Nafula Wanyama v Nusra Nasambu Chibanaga and Another [2020] eKLR**. 2. The Appellant submits that the trial court erred in finding that the Respondent was unfairly dismissed, despite documentary evidence showing that he had been employed as a general labourer under fixed-term contracts, with the last contract ending on 24th April 2023, and that he did not work beyond this date. 3. The Appellant argues that the learned trial Magistrate dismissed its version on the wrong ground, namely that the produced contracts did not bear his name. Yet only one, for the period 20.06 to 20.07.2016, did not, and the anomaly was duly explained by the witness as a typographical error. The last contract under which the Respondent served bore the Respondent’s name and was duly executed by him. 4. Under Section 47(5) of the Employment Act, 2007, the Respondent was to prove that an unlawful termination of employment had occurred. In a situation as was in the matter, where the contract ended by effluxion of time, the Respondent would not discharge the burden by merely denying a contract that he had executed and alleging forgery without proof. 5. The Appellant further submits that the trial court erred in awarding notice pay, leave pay and house allowance. It argues that notice pay was not payable because the contract had a fixed end date; leave had either been taken or paid for, as evidenced by signed leave forms; and house allowance was included in the Respondent’s pay, as shown in the contracts and pay slips. 6. The Appellant further submits that the Respondent executed a disclaimer form on 24th April 2023, acknowledging that he had no claims against the Appellant except for three pending leave days, which were paid. The learned trial Court erred in law in awarding him the relief it awarded. **Respondent’s submissions** 1. The Respondent submits that there was a controversy regarding the nature of the Respondent’s employment. Whereas the Appellant took the position that, from the time the Respondent joined its workforce, he worked under fixed-term contracts, the Respondent maintained otherwise. The learned trial Magistrate did not err in holding that he was unpersuaded by the Appellant’s version. The fact that the Appellant produced in evidence a contract purportedly signed by the Respondent, yet it bore another person’s name, was enough to influence the Magistrate's finding. 2. The forged contracts that the Appellant placed before the trial Court were only convenient, aimed at helping the Appellant escape liability. However, the Court should not lose sight of the fact that although the contracts described the Respondent as a general labourer, the pay slip indicated that he was in the Galvanised category. 3. The Appellant did not place forth any material to fortify their allegation that the respondent first joined them in 2016. In fact, the NSSF statement produced in evidence shows that he joined in 2014. 4. The Respondent further contends that the Appellant’s witness, RW1, lacked reliability and consistency. He first asserted that the Respondent worked continuously for the Appellant during his employment, but subsequently testified that the Respondent did not work during those periods for which there are no contracts. 5. He submits that the Appellant denied his assertion as an employer that he worked up to 4th April 2023. Though the Appellant denied this, he did not produce any documents to establish it. If indeed he worked up to 24th April 2023, the appointed lapse day, nothing would have been easier than producing the work attendance register. In any event, the law obliged it to do so under sections 10 and 74 of the Employment Act; the Appellant ought to have produced attendance records to disprove his case. He relies on **Abigael Jepkosgei Yator & another v China Hanan International Co. Ltd [2018] eKLR.** 6. On termination, the Respondent submits that the trial court correctly found that the termination was unlawful and procedurally unfair. He argues that the Appellant failed to prove the alleged fixed-term contracts and, therefore, that his contract ended by effluxion of time. As such, it was required to comply with the Employment Act before terminating his employment. 7. According to him, the reason for the termination of his employment was a shortage of work, amounting to redundancy. Yet the Appellant did not issue a redundancy notice, apply any fair selection criteria, or pay redundancy dues as required under section 40 of the Employment Act. 8. Alternatively, even if the matter was treated as an ordinary termination, the Appellant failed to prove a valid reason and failed to afford him a hearing as required under sections 41, 43, 45 and 46 of the Employment Act. He relies on **Walter Ogal Anuro v Teachers Service Commission (2013) eKLR,** as cited in **Judith Atieno Owuor v Sameer Agriculture and Livestock Limited [2020] eKLR,** for the principle that termination must satisfy both substantive justification and procedural fairness. 9. Regarding remedies, the Respondent supports the award of one month’s salary in lieu of notice, as he was not given notice before termination. He also supports the award of unpaid leave, arguing that the leave forms produced by the Appellant were invalid because they lacked the Appellant’s stamp or signature and did not show the employer’s approval. 10. The Respondent also submits that the trial court properly awarded an unpaid house allowance under section 31 of the Employment Act, as the Appellant neither provided housing nor proved that his salary was consolidated. However, as with leave pay, he argues that the trial court underawarded the house allowance by capping it at three years. An award for the entire period would be justified. 11. He further argues that the trial court ought to have awarded underpayment, severance pay and gratuity. On underpayment, he contends that his salary was below the applicable minimum wage for a machine attendant. On severance pay, he argues that since he was sent away due to a shortage of work, the termination amounted to redundancy. 12. On gratuity, he submits that, having worked continuously for 9 years, he was entitled to gratuity at the rate of 15 days for each completed year of service. 13. Regarding compensation, the Respondent supports the award of eight months’ salary for unfair termination. He submits that the Appellant acted unfairly by terminating him without notice, a hearing, a valid reason or due process, and by allegedly relying on forged contracts to defeat his claim. He also supports the award of a certificate of service under section 51 of the Employment **Analysis and determination** 1. As this is a first appeal, this Court is required to reconsider and re-evaluate the evidence placed before the trial court and to arrive at its own independent conclusion, bearing in mind that it did not have the benefit of seeing and hearing the witnesses testify. See **Selle & Another v Associated Motor Boat Co. Ltd & Others [1968] EA 123.** 2. I have carefully considered the record of appeal, the judgment of the lower court, the grounds of appeal and the submissions by the parties, and hold that the instant appeal revolves around the following issues: 3. Whether the trial court erred in finding that the Respondent’s employment was unfairly and unlawfully terminated; and 4. Whether the Respondent was entitled to the reliefs awarded by the trial court; and 5. There is no dispute that, at all material times, the Respondent was an employee of the Appellant, and that the Respondent's employment came to an end in April 2023. However, there is significant controversy over the manner of termination. The Respondent contended that the Appellant initiated the termination, while the Appellant asserted that the employment ended by effluxion of time, following the expiration of the fixed-term contract under which the Respondent last served, which had a specified lapse date. The contract ran from 24th March 2023 to 23rd April 2023 and ended by effluxion of time. 6. The way they are designed and as contemplated under Section 10(3)(c) of the Employment Act, fixed-term contracts which in nature are not intended to be indefinite, must have a specific commencement date and lapse date. In **Mutisya v Machakos County Assembly Service Board [2022] KEELRC 12953 (KLR),** the court stated ***“The law on fixed-term contracts is well settled in this Country. Fixed-term contracts have a definite start date and a definite or ascertainable end date in line with the provisions of Section 10(3)(c) of the Employment Act, 2007.”*** 1. The legal effect of a valid fixed-term contract is that it lapses automatically on the date agreed by the parties, unless there is evidence of renewal, extension, or a legitimate expectation of renewal. 2. Having stated thus, I now turn to consider whether, at the time of separation from employment, the Respondent had been serving the Appellant under the fixed-term contract hereinabove stated. 3. Before the trial court, the Appellant produced the Respondent’s employment documents, including the last contract for the period between 24th March 2023 and 23rd April 2023. I have carefully considered the contract of employment and note that it was executed by three parties: the employee [Benard Ohindo], someone acting on behalf of the Appellant, and a witness. The Respondent denied signing the contract and alleged that the signature was forged. This Court notes that, upon being served with the Appellant’s response and the documents intended to be tendered in evidence, the Respondent filed a Reply to the Memorandum of Response dated 28th September 2023. I have carefully considered the pleading; the Respondent did not deny that the signature on the contract was his or allege forgery. 4. In my view, an allegation of forgery against a person is a grave matter, as it carries criminal implications. If a party needs to rely on it to bolster its case or defence, it is a material fact that must be expressly and unambiguously pleaded. If, indeed, the signature was forged as alleged, nothing could have been easier than for the Respondent to plead it in his last filed pleading. I am of the view that the allegation was an afterthought. 5. In light of the foregoing, I conclude that the Respondent's denial of the contract and his execution of it were an afterthought. He executed the contract and cannot be permitted to evade it. 6. On focus before the trial, the Court was the last contract under which the Respondent served. It bore the name of the Respondent. Yet, the learned trial Magistrate’s finding gives an impression that it did not. A wrong conclusion, which prejudicially influenced his decision. I have not lost sight of the fact that the other contract produced as evidence bore the name Benard Otieno instead of Benard Ohindo, an anomaly that I see no reason to hold was anything other than a typographical error, as explained by the Appellant’s witness. The learned trial Magistrate considered an irrelevant matter to the prejudice of the Appellant. 7. In the upshot, I find that the Respondent last employed the Appellant under fixed-term contracts, which expired on 23rd April 2023. The employment relationship therefore came to an end by effluxion of time, not by unfair termination or redundancy. The learned trial Magistrate erred in holding otherwise. 8. Since the contract expired automatically upon its term completion, the Appellant was not obliged to issue a termination notice pursuant to section 35 of the Employment Act, nor was it necessary to conduct a disciplinary hearing under section 41. These provisions would have been applicable had the Appellant terminated the employment prior to the agreed expiry date. See **Registered Trustees De La Salle Christian Brothers t/a St. Mary’s Boys’ Secondary School v Julius DM Baini[2017]Eklr.** 9. The trial court therefore erred in finding that the Respondent’s employment was unfairly and unlawfully terminated. The finding that the Respondent was entitled to compensation for unfair termination and to one month’s salary in lieu of notice cannot stand. 10. Having found as I have hereinabove that the Respondent was employed under the aforementioned fixed-term contract, and noting that the contract included a provision for a house allowance, it is therefore apparent that the award of the allowance by the learned trial Magistrate lacked a proper legal foundation. 11. In conclusion, the Appellant’s appeal is largely successful. The award of notice pay, compensation for unfair termination, and house allowance are hereby set aside. **Read Signed and Delivered this 28th Day of May 2026.** **OCHARO KEBIRA** **JUDGE**