Ochieng v Agricultural Development Corporation (Cause 119 of 2020) [2025] KEELRC 1335 (KLR)
The bottom line
#Kenya's Employment Court confirmed that employers may freely decline to renew fixed-term contracts when the contract itself makes renewal discretionary.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the parties were in a contract of service
- 2.Whether the contract of service was constructively renewed after lapsing of the three years' tenure on 28.02.2019
- 3.Whether the claimant was terminated and, if so, whether the termination was unfair; including whether the 'soft landing' of a one-year renewal was justified and whether there was discrimination
- 4.Whether the claimant had established justification for grant of any of the remedies prayed for
Key legal issues
#Existence and nature of the contract of service
The parties were in a fixed-term contract of service of three years (01.03.2016 to 28.02.2019), which the claimant served successfully
The claimant was engaged on probation per the letter of 16.07.2015, confirmed by letter of 03.03.2016 and emplaced on contractual terms with an attached agreement for 36 months. He served the full three-year term as Complex Manager at the stations to which he was deployed.
Whether the contract was constructively renewed
No constructive renewal; the contract lapsed by effluxion of time, and the one-year non-renewable contract was a discretionary renewal granted as a soft landing
Clause 1(b) of the agreement vested renewal in the respondent's discretion, and clause 3.5.3 required the employee to apply for renewal six months before expiry. The claimant never applied for renewal. The one-year renewal followed a disciplinary process finding him culpable of conflict of interest (planting maize on the respondent's land without authority) and was a valid, genuine and fair exercise of the employer's discretion.
Whether there was unfair termination and whether the soft landing was justified
There was no termination; the claimant unilaterally rejected the soft landing and left employment, so no unfair termination arises
The claimant was given a show-cause letter, replied, attended a disciplinary hearing, was found culpable, and received a one-year renewal as a soft landing. He did not appeal (though he confirmed the option existed) or seek review as advised by the Managing Director, but unilaterally left and sued. The Court distinguished Malachi Ochieng Pire v Rift Valley Agencies, where soft landing was used to conceal poor performance without a disciplinary process; here all disciplinary steps had been taken first.
Discrimination claim
Discrimination fails for want of a due comparator
The claimant alleged other staff involved in similar conflict of interest had their contracts renewed for three years. The Court found the material circumstances of such renewals were not established as substantially similar to the claimant's case.
Legal principles established
#- Renewal of a fixed-term contract is a matter of the employer's discretion where the contract and policy so provide, including discretion over the tenure of the renewal
- A continued contract must lapse by effluxion of time unless a legitimate expectation of constructive renewal is established; renewal provisions that vest discretion in the employer do not create such expectation
- At the end of a disciplinary process, the employer retains wide discretion, including granting a soft landing such as a non-renewable term contract, and a soft landing after due process is justified where the employee is culpable
- Allegations of discrimination fail for want of a due comparator where substantially similar circumstances of treatment of other employees are not established
Court orders
#- 1.Dismissal of the claimant's suit
- 2.Each party to bear own costs of the proceedings
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under Article 162(2) of the Constitution over employment and labour relations disputes (as implied by the suit's framing); no explicit provision recited in the judgment
Relief refused
#Declaration that Sections 5 and 41 of the Employment Act and Articles 10, 27, 28, 41, 47 and 50(1) of the Constitution were violated, making the respondent's actions null and void
No termination was established; the claimant received a one-year renewal and rejected it
Mandatory injunction to pay dues for the remainder of the contractual period (Kshs. 1,572,672/-)
Claimant failed to establish justification for any of the remedies
Order compelling renewal of contract for a further three years under clause 3.5.3 of the Human Resources Policy Manual
Renewal was discretionary and the claimant failed to apply for renewal six months before expiry
Declaration of constructive renewal for three years from 01.03.2020
No legitimate expectation for constructive renewal was founded
Permanent injunction restraining replacement of the claimant as Complex Manager
Suit dismissed
General damages for constitutional violations or, alternatively, maximum compensation for unlawful termination
No violation established; no termination occurred
Costs
Each party to bear own costs of proceedings
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
The Court upholds the submission for the respondent that the claimant's contract was a fixed term contract running for 36 months from 1st March 2016 to 28th February 2019 and the wording of the contract and applicable policy did not in any manner present a legitimate expectation for the renewal of the contract.
the reason for denial of three years renewal and imposition of a one year renewal with a terminal leave were valid, genuine and fair because the reason existed and was fair, relating to the claimant's misconduct and the respondent's operational systems, namely, confiict of interest
The initial three year contract had lapsed by efiuxion of time and the one year renewal contract was running and nothing before the Court has established a termination of contract on the part of the respondent as was alleged or urged for the claimant.
Allegations of discrimination in the circumstances will collapse for want of due comparator.
at the end of a disciplinary process, the employer retains a wide discretion and prerogative ranging from imposition of a punishment, granting a soft landing like an early retirement or in the current case, a non-renewable term contract, and, the employer may as well pardon the employee in favour of a continued contract of employment
In conclusion the suit is dismissed and each party to bear own costs of proceedings.
Issues in the judgment
#OCR artifacts in judgment text ('ofiered', 'efiective', 'confiict', 'thre'), and the paragraph numbering restarts at '1.' after paragraph 14, with a long quoted passage from another judgment embedded within it
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Ochieng v Agricultural Development Corporation (Cause 119 of 2020) [2025] KEELRC 1335 (KLR)", Case Analysis (2025). ELRC Cause (Nairobi) - claim dated 26.02.2020. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1335/eng@2025-05-09
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.