UNDERSTANDING THE LAW ON TERMINATION OF PROBATIONARY CONTRACTS

Before section 42 (1) was declared unconstitutional, there was inconsistency in jurisprudence on employment law relating to probationary contracts occasioned by various decisions of different courts of coordinate jurisdiction. Section 2 of the Employment Act defines a probationary contract as “a contract of employment, which is of not more than twelve months’ duration or part thereof, is in writing and expressly states that it is for a probationary period;” The law provides that a probationary period shall not exceed six months but it may be extended for a further period of not more than six months after deliberation with the employee.

Probation allows the employer to assess objectively whether a new employee is suitable for the job taking into account their capability, skills, performance, attendance, and general conduct. It is however important to note that a probationary contract can only be extended on grounds of non-performance or unsuitability of an employee for the job. The court, in the case of?Wilson Simiyu Vs Chairman B.O.G Friends School Bokoli & Another (2016) (eKLR)?stated that extension of a probationary period can only be on the grounds of non-performance or non-suitability for the job, both of which cannot be presumed, but must be brought to the attention of the employee.

The question of whether dismissing an employee during their probation period constitutes unfair employment was a contentious issue, leading to divided opinions in the courts over the years. Some Courts were of the view that when terminating employment contracts during the probationary period, employers were not required to provide reasons for their decisions or give the employee an opportunity to be heard before termination. The said Courts relied on Section 42(1) of the Employment Act?which provides that “a party to a contract for a probationary period may terminate the contract by giving not less than seven days’ notice of termination of the contract, or by payment, by the employer to the employee, of seven days’ wages in lieu of notice.”

An example is the case of Danish Jalang’o & another v Amicabre Travel Services Limited (2014) eKLR ?Rika J. stated as follows:

“There is no obligation under Section 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 the probationary contract 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 was, during the probation period, treated in accordance with the terms and conditions of the probationary contract. The Employee has no expectation of substantive justification, or fairness of procedure, outside what the probation clause and Section 42 of the Employment Act 2007 grants. If the Employee has received notice of 7 days before termination, or is paid 7 days’ wages before termination, there can be no further demands made on the Employer. If the Employee is advised termination is because the Employer feels there should be no confirmation, there can be no additional demands for substantive justification made on the Employer. The Employer retains the discretion whether to confirm, or not confirm an Employee serving under probation. The law relating to unfair termination does not apply in probationary contracts. … the correct interpretation is that Section 43 and 45 of the Employment Act, both in terms of procedural and substantive justification, have no application to termination of probationary employment contracts.? Section 42 would have no meaning, and probation, which is a period granted to the Employer and the Employee to get to know each other before making any firm commitments, would itself be meaningless … What more substantive justification would be needed, beyond the explanation that the contract has a probationary provision, based on a substantive law under Section 42?”

Other cases which have held the same view include the case of Christopher Kisia Kivango v Amicabre Travel Services Ltd [2014] eKLR.?Nzioki Wa Makau J. expressed similar sentiments in?John Muthomi Mathiu v Mastermind Tobacco (K) Limited.

Other Courts held a different opinion that section 42(1) of the Employment Act is inconsistent with Article 41 of the Constitution which guarantees employment and labour rights for all.? The decision in?Evans Kiage Onchwari v Hotel Ambassadeur Nairobi [2016] eKLR?is a case in point where Ndolo J. stated that:

“I venture to add that Section 42(1) would also be unconstitutional. I say so because even assuming that an employee is found unsuitable within the probation period, the rights secured under Article 41 must still be respected.”

With the inconsistency of opinions from various Courts, a 3-judge bench was appointed to determine the case of Monica Munira Kibuchi & 6 others v Mount Kenya University; Attorney General (Interested Party) [2021] eKLR, a constitutional petition that sought to challenge the constitutionality of Section 42(1) of the Employment Act. The Learned Judges expressed themselves as follows:

“Further, in addition to the inconsistencies among Sections 42(1), 42(2) and 41 considered earlier in this judgement, we find no reasonable and justifiable cause in the exclusion of an employee holding a probationary contract from the procedural safeguards contained in Section 41 of the Employment Act. To this extent therefore, we find and hold that Section 42(1) insofar as it excludes an employee holding a probationary contract from the provisions of Section 41 of the Employment Act, is inconsistent with Articles 41 and 47 of the Constitution hence null and void.”

The said section 42(1) having been declared unconstitutional, meant that employees on probationary contracts are also entitled to the due process rights outlined in Section 41 of the Employment Act. The position has also been reiterated in the case of Zeddy Cheronoh Sambu v National Oil Corporation of Kenya [2022] eKLR.

Conclusion?

With the declaration of section 42 (1) being unconstitutional, the disparity in opinions on the matter is now well settled and the procedure provided under Section 41 must be followed by employers when terminating employees on probation. ?It is therefore crucial that before an employer terminates an employee on probation, he/she must explain to the employee the reason for which the employer is considering termination and the employee or a representative of the employee must be given the opportunity to defend or make their own presentations before the decision is made, failure to which would amount to unfair termination.

Our team at JMK PARTNERS ADVOCATES LLP is well versed in all matters employment and industrial labour relations and benefits. We maintain a keen eye on legal and market trends in a bid to ensure that our clients stay at the market front and on top of every development.

Authored By: Newton Kariuki (Senior Associate)

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