The Kenya Employment Act, 2007 (Employment Act), was enacted to declare and define the fundamental rights of employees and to provide basic conditions of employment to employees among other things. Employment laws and regulations in Kenya, govern the termination and dismissal of employees to ensure fairness and protect the rights of both employers and employees.
Unfair termination and summary dismissal (dismissal) can have legal consequences for employers. The employer must ensure that the dismissal was both substantively and procedurally fair and proper. This means that the reason for dismissal/termination ought to be valid and the procedure followed to dismiss/terminate the employee was fair and proper. The reason for dismissal/termination could be considered fair if it is related to the employee’s conduct, capacity and/or compatibility or where it is based on the operational requirements of the employer.
This piece by the law firm, will focus on the dismissal and unfair termination of employees in Kenya and some legal principles governing it.
At this point, it would be important to define Summary Dismissal as per the Employment Act. Section 44(1) of the Employment Act states that, “summary dismissal shall take place when an employer terminates the employment of an employee without notice or with less notice than that to which the employee is entitled by any statutory provision or contractual term”.
Employers are required to follow certain procedures and meet specific conditions when terminating or dismissing employees. Here are some key aspects to consider:
Fair grounds for Dismissal/Termination:
Dismissal/Termination of an employee should be based on fair and justifiable grounds.
Employment Contract
Employment contracts in Kenya can be either oral or written, but it is advisable to have a written contract that meets the basic criteria provided in the Employment Act. The contract should clearly outline, among others, job description, the period of employment, terms, and conditions of employment, including grounds for termination and notice periods.
Collective Bargaining Agreements (CBAs)
If there is a collective bargaining agreement in place, it may provide additional or modified provisions related to termination or dismissal that both the employer and employees must adhere to.
Notice Period
Employers are required to provide notice to terminate an employee’s contract or pay in lieu of notice. The length of the notice period may be specified in the employment contract or outlined in relevant labour laws in Kenya.
The notice period is based on the terms agreed in the employment contract. However, where there is no express agreement, section 35(1) of the Employment Act, provides that notice shall be issued:
Close of day without notice: Where the contract is to pay wages daily;On a periodic basis when payment is due where the contract to pay wages is less than a month: For instance, if wages are paid every fortnight, the notice issued shall at least be for the same period; andTwenty-eight days: Where the contract is to pay wages every month.Due Process
Employers must follow due process when terminating employees. This includes giving the employee an opportunity to be heard, presenting evidence, and allowing the employee to defend themselves against any allegations that may be levied against them. Employees should also be made aware of, among other things, their right to present witnesses, adduce evidence in support of their position, have their chosen representative present during the hearing and their right to appeal if they are aggrieved by any decision.
Retrenchment and Redundancy: If a termination is due to redundancy or retrenchment, employers must follow specific procedures outlined in the Employment Act of Kenya, including but not limited to, consultation with affected employees and the payment of severance pay.Reporting to the Labour Office
The employer is responsible for notifying the labour office in the district in which the employee was working. Specific information ought to be included, such as but not limited to, circumstances leading to the dismissal and period of notice.
Compensation
An employee is entitled to compensation as agreed in the contract of employment and/or the CBA. This includes severance pay, service pay and gratuity, where applicable.
Certificate of Service
The employer must ensure that the employee receives a Certificate of Service upon termination of employment.
Dispute Resolution
Kenya has various mechanisms for resolving labour disputes, including the Courts of competent authority or arbitration. Employees who believe they have been unfairly terminated can file a complaint with the relevant bodies for resolution.