Employment contracts in Kenya often include a probationary period to assess the suitability of a new employee for a given role. The termination of employment during this period is governed by the Constitution of Kenya, the Employment Act, and various court precedents. This article outlines the legal framework and provides insights from relevant case law to guide employers and employees through terminating employment contracts during probation.
Definition of a Probationary Employee
A probationary employee is a worker employed on a trial basis for a specified period, usually to determine their suitability for the position. According to Section 2 of the Employment Act, 2007, a probationary contract is defined as a contract of employment of not more than twelve months’ duration, or part thereof, as the employer may specify, but subject to agreement between the employer and the employee. Typically, a probationary period is for six (6) months. However, it can be extended for six months with the employee’s consent, making the maximum duration one year.
Purpose of a Probationary Period
A probationary period allows the employer and employee to evaluate the suitability of the employment arrangement based on performance, conduct, and overall fit within the organization.
Legal Framework
1. The Constitution of Kenya, 2010
The Constitution guarantees fair labour practices and protection against unfair termination. Article 41 provides the right to fair labour practices, and Article 47 grants the right to fair administrative action. These provisions underscore the importance of fairness and due process in employment matters, including during probation.
2. The Employment Act, 2007
The Employment Act is the primary legislation governing employment relations in Kenya. It outlines the rights and obligations of employers and employees, including the provisions related to probationary contracts.
Key Provisions:
- Section 42: This section explicitly addresses probationary contracts, stating that the provisions of Section 41, which mandate a fair hearing before termination, do not apply to employees on probation. However, probationary periods should not exceed six months and should be extendable to one year with the employee’s consent.
- Section 41: Although Section 42 excludes probationary employees from its provisions, Section 41 generally requires employers to provide reasons for termination on account of gross misconduct and offer employees an opportunity to defend themselves.
Section 42(1) of the Employment Act provides:
“The provisions of section 41 shall not apply where a termination of employment terminates a probationary contract.”
Section 41, referred to above, provides:
“Subject to section 42(1), an employer shall, before terminating the employment of an employee, on the grounds of misconduct, poor performance or physical incapacity explain to the employee, in a language the employee understands, the reason for which the employer is considering termination, and the employee shall be entitled to have another employee or a shop floor union representative of his choice present during this explanation.”
Judicial Interpretation
The Kenyan judiciary has provided various interpretations of how these provisions apply to probationary employees. The jurisprudence from the Employment and Labour Relations Court (ELRC) on the constitutionality and application of Section 42(1) of the Employment Act is divided.
1. Monica Munira Kibuchi & 6 others v Mount Kenya University; Attorney General (Interested Party) [2021] eKLR
In this case, the court held that employees on probation are entitled to fair labor practices as guaranteed by the Constitution in Articles 41 and 47 including being told the reasons for their termination and accorded a fair hearing. Further, the court opined that under Section 2 of the Employment Act, which defines who an employee is, the Act does not segregate an employee on probation from the general definition of an employee. Therefore, the court held that the reading of Section 41 and the implicit provisions of Section 42(2) render the provisions of Section 42(1) illogical. The court further emphasized that labour rights are part of the Bill of Rights by Article 41 of the Constitution.
Accordingly, per the provisions of Article 24 of the Constitution, there was no reasonable and justifiable cause for excluding an employee holding a probationary contract from the procedural safeguards contained in Section 41 of the Employment Act. Subsequently, the court declared Section 42(1) and (2) of the Employment Act unconstitutional, stating that it infringed on the fundamental rights of employees to fair labour practices and administrative action as provided under Articles 24, 41 and 47 of the Constitution.
2. Joseph Kareko Gikonyo v County Government of Lamu & 2 others [2022] eKLR
This case reiterated that while Section 42 excludes probationary employees from the procedural requirements of Section 41, employers must provide substantive reasons for termination. The court ruled that probationary employees are entitled to know the reasons for their termination and that the reasons should be valid and fair. The court thus quashed the termination of the Petitioner and proceeded to award the Petitioner compensatory damages for violating his constitutional and statutory rights.
3. Mwilo v Absa Bank (K) PLC (Cause 31 of 2020) [2022] KEELRC 53 (KLR) (5 May 2022) (Judgment
In this case, the court held that despite the exclusion under Section 42, the principles of natural justice apply. Also, the court held that an employer cannot seek to arbitrarily extend the probationary period through oral notice. The employee is deemed confirmed once a probationary term ends, and the employer does not offer a confirmation letter. Further, the court opined that in terminating probationary contracts the employer must demonstrate that the termination was based on valid reasons related to performance or conduct during the probationary period.
Divergence in Judicial Opinions
The ELRC lacks a uniform stance on the matter of terminating probationary employees. Some judges hold that employees under probation are excluded from the fair hearing safeguards under Section 41 of the Employment Act. Notable cases illustrating this view include:
1. Danish Jalang’o v Amicabre Travel Services [2014] eKLR
Justice Rika held that there is no obligation under sections 43 and 45 for employers to give valid and fair reasons for terminating probationary contracts or to hear such employees at all, according to the rules of fairness, natural justice, or equity. The court emphasized that termination of probationary contracts is strictly regulated by the terms of the contract, and the only question the court should ask is whether the appropriate notice was given or if not given, whether the employee received pay in lieu of notice.
“There is no obligation under sections 43 and 45 for employers to give valid and fair reasons for termination of probationary contracts, or to hear such employees at all, little less in accordance with the rules of fairness, natural justice or equity. The termination of probationary contracts is strictly regulated by the terms of the contract. The only question the court should ask is whether the appropriate notice was given or, if not given, whether the employee received pay in lieu of notice; and whether the employee, during the probationary period, was treated in accordance with the terms and conditions of the probationary contracts. The employee has no expectation of substantive justification, or fairness of procedure outside what the probation clause and section 42 of the Employment Act grants … the law relating to unfair termination does not apply in probationary contracts.”
“The probation law should be retained. Employers should retain a freehand in evaluating Employees’ suitability, and in terminating the relationship during probation, where the Employee is found wanting. Where there is breach, such as unilateral extension of the probationary period by the Employer, or where notice of termination is not given, such breaches can be redressed through contractual damages as done in the case of Catherine E. Nyawira Nyaga, not through statutory compensation for unfair termination. It is not proper that rules of natural, procedural, and substantive justice under Sections 41, 43 and 45 of the Employment Act 2007 are imported into probationary contracts. Section 42 of the Employment Act 2007 is a standalone law, regulating a special, formative, employer-employee relationship, and should be read as a reasonable limitation on the constitutional rights flowing from Article 41 of the Constitution of Kenya, as well as those rights and protections given under the other provisions of the Employment Act 2007”
2. John Muthomi Mathiu v Mastermind Tobacco (K) Ltd [2018] eKLR
Justice Nzioki wa Makau agreed with Justice Rika’s position in the Danish Jalang’o case, stating that the probationary part of a contract of employment is the period where an employee is tested and cannot anticipate the same safeguards available for an employee already confirmed to the position.
“the probationary part of a contract of employment is the period where an employee is tested and he cannot therefore anticipate the same safeguards to be available for him/her like for an employee already confirmed to the position.”
Best Practices for Terminating Employment During Probation
Given the constitutional guarantees and judicial interpretations, employers should adhere to the following best practices when terminating employment during the probationary period:
- Provide Clear Reasons: Employers should provide clear and valid reasons for the termination. This helps demonstrate that the decision was not arbitrary but based on the employee’s performance or conduct.
- Offer an Opportunity to Respond: While not a statutory requirement under Section 42, offering the employee an opportunity to respond to the reasons for termination can help ensure fairness and mitigate potential legal challenges.
- Document the Process: Maintain thorough documentation of the employee’s performance reviews, any warnings issued, and the termination process. This documentation can serve as evidence of fairness and due process if the termination is challenged.
- Conducting Fair Assessments: Regular performance evaluations should be conducted to provide feedback and identify areas for improvement. This practice not only helps employees develop but also protects employers in case of disputes.
- Pay Due Entitlements: Ensure the employee receives all due entitlements, including payment for worked days, accrued leave, and other contractual benefits. This helps prevent disputes over unpaid dues.
Conclusion
Terminating employment during the probationary period requires careful adherence to the legal framework provided by the Constitution, the Employment Act, and judicial precedents. Employers must balance the flexibility provided by Section 42 with the constitutional guarantees of fair labour practices. By providing clear reasons, offering opportunities to respond, and documenting the process, employers can ensure that terminations are conducted fairly and in compliance with the law.
Understanding and applying these principles helps protect employees’ rights while enabling employers to make informed decisions during probation.
How Njaga & Co Advocates can assist you.
At Njaga & Co Advocates, we understand the complexities of terminating employment contracts during probationary periods in Kenya. Our experienced team of legal professionals is dedicated to providing comprehensive support to both employers and employees to ensure a fair and lawful process. Here’s how we can help:
For Employers:
- Legal Compliance: We ensure that the termination process complies with the Employment Act and other relevant legislation, helping employers avoid legal pitfalls and potential disputes.
- Drafting and Reviewing Contracts: Our team assists in drafting and reviewing employment contracts to include clear and enforceable probationary terms, ensuring that both parties know their rights and obligations.
- Policy Development: We help employers develop and implement robust HR policies that outline procedures for managing probationary periods, including performance reviews and termination protocols.
- Advisory Services: We offer ongoing legal advice on best practices for managing probationary employees, including conducting fair evaluations and providing necessary feedback to support performance improvement.
- Representation: In the event of disputes or claims arising from termination during probation, we represent employers in negotiations, mediation, and legal proceedings to protect their interests.
For Employees:
- Understanding Rights: We educate employees about their rights during the probationary period, including the grounds for lawful termination and the entitlements they should expect.
- Contract Review: Our team reviews employment contracts to ensure that the terms related to probation and termination are fair and lawful, providing clarity and peace of mind for employees.
- Dispute Resolution: If an employee believes their termination was unjust, we offer representation and support in resolving disputes through negotiation, mediation, or litigation.
- Advisory Services: We provide advice on navigating the probationary period, including how to address performance issues and communicate effectively with employers to enhance job security.
- Support During Transition: For employees facing termination, we offer guidance on securing their legal entitlements and transitioning to new employment opportunities.