UNFAIR TERMINATION IN KENYA: UNDERSTANDING EMPLOYEE RIGHTS AND EMPLOYER OBLIGATIONS
Employment relationships in Kenya are regulated by various laws intended to protect the rights and obligations of both employers and employees. One of the most common disputes arising in the workplace is unfair termination of employment. Employees who are dismissed without lawful justification or without adherence to the proper legal procedure may seek legal redress before the Employment and Labour Relations Court.
This article discusses unfair termination in Kenya, the laws governing employment relationships, the obligations imposed on employers, and the remedies available to employees.
What Constitutes unfair termination?
Unfair termination occurs where an employer dismisses or terminates the employment of an employee without a valid and fair reason and/or without following the procedure established under Kenyan employment law.
Under Section 45 of the Employment Act, 2007, an employer must prove both the reason for termination and the fairness of the procedure followed.
What amounts to unfair termination?
Below are some of the common grounds that may amount to unfair termination under Kenyan law:
- Termination Without a Valid Reason
An employer is required under Sections 43 and 45 of the Employment Act to provide a genuine and justifiable reason for terminating an employee.
Where an employer dismisses an employee arbitrarily or without evidence supporting the reason for termination, the dismissal may be declared unfair.
- Failure to follow due procedure
Even where a valid reason exists, the employer must comply with procedural fairness as provided under Section 41 of the Employment Act.
Section 41 of the Employment Act provides that an employer must:
- Explain to the employee, in a language the employee understands, the reason for which the employer is considering termination
- Allowing the employee an opportunity to respond
- Conducting a disciplinary hearing
- Permitting the employee to be accompanied by a fellow employee or union representative during the hearing
- Discrimination
Termination based on discriminatory grounds is prohibited under Article 27 of the Constitution of Kenya and Sections 5 and 46 of the Employment Act.
An employee cannot lawfully be dismissed on account of Gender, pregnancy, marital status race or ethnicity, Religion, Disability and HIV status.
Discriminatory dismissal constitutes unfair termination and may expose the employer to legal liability.
- Termination Without Notice
Sections 35 and 36 of the Employment Act require employers to issue proper notice before termination unless the circumstances justify summary dismissal under Section 44.
Where employment is terminated abruptly without lawful justification or payment in lieu of notice, the termination may be challenged as unfair.
Remedies Available for Unfair Termination
Where an employee successfully proves unfair termination, the Employment Act, 2007 empowers the Employment and Labour Relations Court to grant various remedies depending on the circumstances of the case. The remedies are intended to compensate the employee for losses suffered and to ensure fairness in employment relationships.
Below are some of the principal remedies available to the employee:
- Compensation for Unfair Termination (not exceeding twelve months)
Under Section 49 of the Employment Act, the court may award an employee compensation of up to twelve (12) months’ gross salary for unfair termination.
The amount depends on factors under Section 49(4), including:
- The employee’s length of service;
- The circumstances leading to the termination;
- The employee’s conduct;
- The employer’s compliance with procedural fairness;
- The employee’s chances of securing alternative employment; and
- The extent to which the employee contributed to the termination.
It is however important to note that this remedy is discretionary and depends on the facts of each case.
- Salary in Lieu of Notice
Where an employer terminates employment without issuing the required notice, the employee may be entitled to payment in lieu of notice pursuant to Sections 35 and 36 of the Employment Act.
The amount payable is usually equivalent to the notice period provided in the employment contract.
- Accrued Leave Days (Unpaid Leave)
Employees are entitled to annual leave under Section 28 of the Employment Act. Where an employee has accrued leave days that were not utilized by the time employment ends, the employer may be required to compensate the employee for those outstanding leave days.
- Unpaid Salary, Overtime, and Employment Benefits
Employees are entitled to annual leave under Section 28 of the Employment Act. Where an employee has accrued leave days that were not utilized by the time employment ends, the employer may be required to compensate the employee for those outstanding leave days.
The court may order payment of, outstanding salary arrears, service and anny other contractual employment benefits due to the employee.
- Reinstatement
In some cases, the court may order reinstatement of the employee to their former position without loss of benefits.
However, reinstatement is usually granted only in exceptional circumstances, particularly where:
- The employment relationship is still workable;
- The dismissal was manifestly unlawful; and
- The remedy is sought within the statutory time limits.
- Re-engagement
The court may also order re-engagement of the employee in comparable or suitable employment within the organization.
This remedy differs from reinstatement because the employee may not necessarily return to the exact previous position.
- Issuance of a Certificate of Service
Under Section 51 of the Employment Act, an employer is legally obligated to issue a certificate of service to an employee upon termination.
Courts always order the issuance of a certificate of service regardless of whether the termination was fair.
- Costs and interests of the Suit
The Courts increasingly award costs where employers ignored statutory processes, or defended claims frivolously.
This helps compensate the employee for expenses incurred while pursuing the claim.
CONCLUSION
Kenyan employment law places a duty on employers to ensure that termination of employment is both substantively justified and procedurally fair. Employers who fail to comply with the law risk legal action and financial liability for unfair termination.
Employees who believe they have been unlawfully dismissed should seek legal advice promptly to safeguard their rights and pursue the remedies available under the law.
Our firm provides legal advice and representation in employment and labour matters including unfair termination claims, wrongful dismissal disputes, disciplinary proceedings, employment contract disputes, and workplace compliance advisory services.
