INTRODUCTION

“A promise is a debt unpaid!” but to our Courts, it is something more than that.

The doctrine of legitimate expectation has increasingly become a powerful tool in employment disputes, particularly where employees rely on promises, conduct, or established practices of their employers. Traditionally rooted in public law, this doctrine has evolved significantly and is now firmly part of Kenya’s employment law landscape.

A key area where this doctrine has gained traction is in fixed-term employment contracts, especially where such contracts are renewed repeatedly over time. This raises a critical legal question:

Can repeated renewals create a reasonable expectation of continued employment?

This article explores the legal framework, key judicial decisions, and practical implications of legitimate expectation in fixed-term contracts in Kenya.

LEGAL FRAMEWORK

Understanding Employment Contracts in Kenya

Under the Kenya’s Employment Act,2007, employment relationships fall into four main categories. This was affirmed by the Court in the case of Krystalline Salt Limited v Kwekwe Mwakele & 67 Others [2017] eKLR :

“The Employment Act recognizes four main types of contracts of service: contract for an unspecified period of time, for a specified period of time, for a specific task (piece work), and for casual employment. The decision to elect which form of employment to go for, either as an employee or employer, will depend on a number of factors, but the dominant consideration is, for the employee, the earnings and other physical conditions of employment, and on the other hand, savings for the employer.”

Among these, fixed-term contracts are particularly common in both the private and public sectors. These contracts have a defined start and end date and are generally understood to terminate automatically upon expiry.

However, as we shall see, the legal position is not always that straightforward.

The Doctrine of Legitimate Expectation -what is legitimate expectation?

The doctrine of legitimate expectation arises where a party reasonably relies on a clear promise or representation.

The Supreme Court of Kenya in the case of Communications Commission of Kenya & 5 others v Royal Media Services Ltd & 5 others [2014] eKLR set out the key elements for legitimate expectation:

• • • there must be an express, clear and unambiguous promise ;
    • the expectation itself must be reasonable;
    • the representation must be one which it was competent and lawful for the decision-maker to make; and
    • there cannot be a legitimate expectation against clear provisions of the law or the Constitution.

Although originally applied to public authorities, Kenya Courts have extended these principles to private employment, particularly regarding renewal of fixed term contracts.

Fixed-Term Contracts: The General Legal Position

The Employent Act recognizes fixed-term contracts under Section 10(3), which requirews that the contract specify its duration or end date.It provides as follows:

“Where the employment is not intended to be for an indefinite period, the period for which it is expected to continue or, if it is for a fixed term, the date when it is to end.”

It is notable that the Employment Act does not go further than recognizing and acknowledging the existence of fixed-term employment contracts.

Despite this gap, fixed-term contracts are largely used in Kenya, especially in the private sector and there is now an uptake of the same by Government. Our Courts have over time developed significant jurisprudence on fixed-term contracts even in the absence of substantial legislation on the same.

Kenyan Courts have consistently emphasized that fixed-term contracts carry no rights, obligations, or expectations beyond the expiry date, unless continuous renewals or contractual clauses create a legitimate expectation.

In the case of  Transparency International – Kenya v Omondi [2023] eKLR the Court of Appeal confirmed that:

“It is trite law that a fixed-term contract of employment is a lawful mode of employment with a start and end dates.”

The general position on termination of fixed-term contracts is that upon its expiry, the relationship and duties of the parties to the contract automatically cease. This was enunciated by the Court of Appeal in Keen Kleeners Limited v Kenya Plantation and Agricultural workers’ Union [2021] eKLR where the court stated that:

“The general position on the consequences of expiry of a fixed term contract, as can be gleaned from various decisions of this Court and that of the Employment and Labour Relations Court, is that once a fixed term contract is at an end, the employer has no obligation to justify termination on other grounds beyond the lapse of the fixed period.”

Further, the Court of Appeal in Registered Trustees of the Presbyterian Church of East Africa & another v Ruth Gathoni Ngotho- Kariuki [2017] eKLR held that that fixed term contracts carry no rights, obligations, or expectations beyond the date of expiry.

The court in Wanjohi Muriuki vs. Kirinyaga Water and Sanitation Company Limited & another [2012] eKLR stirred the pot a little further by stating that:

“In the view of the Court, there is no obligation on the part of an employer to give reasons to an employee why a fixed-term contract of employment should not be renewed. To require an employer to give reasons why the contract should not be renewed, is the same thing as demanding from an employer to give reasons why, a potential employee should not be employed. The only reason that should be given is that the term has come to an end, and no more. … Reasons, beyond effluxion of time, are not necessary in termination of fixed-term contracts, unless there is a clause in the contract, calling for additional justification for the termination.”

Further, Courts have ruled that giving reasons for non-renewal is expected only if there was such an obligation created by the contract. The Court in Transparency International – Kenya v Omondi [2023] eKLR restated this position and held as follows:

“We dare say that an automatically renewable fixed-term contract is a contradiction in terms, as it would subject the parties to an indeterminate employment contract.”

From the above decisions, it is notable that Courts look at fixed-term contracts as strict deadline contracts. The Courts assume that by the provision of a termination date, a party should not expect further engagement or even reasons for termination other than the fact that the termination date has passed, unless the contract itself specifies otherwise.

However, various unique circumstances have led the Courts to veer off the general position and to create an exception for certain circumstances. Legitimate expectation is an exception that Courts have since acknowledged.

The Exception: Legitimate Expectation in Practice

Despite the general rule that fixed term contracts are strict deadline contracts, Courts have carved out exceptions on legitimate expectation, particularly in cases of continuous renewal or consistent past practice.

1. Long and Continuous Renewals

Changalwa Vs Unga Limited [2025] eKLR

In this case, the employee had worked under successive fixed-term contracts for over 13 years. The Court held as follows:

“I find in the instant case that any reasonable person in the Claimant’s position would have expected a renewal of contract, or at least notification of non-renewal before the contract term came to an end, based on the previous conduct of the Respondent over more than 13 years that the Claimant worked for the Respondent. I accordingly find and hold that the Claimant had legitimate expectation of renewal of his contract which the Respondent breached to his detriment by failing to either renew the contract or to notify him in advance of the intention not to renew the contract.”

The decision demonstrates that long standing, uninterrupted renewals can create a legitimate expectation of continued employment.

2. Consistent Past Practice

Keen Kleeners Limited v Kenya Plantation and Agricultural workers’ Union (2019) eKLR

In this case, the employee was engaged on successive fixed-term contracts from 2007, each renewed routinely until August 1, 2011. The Court found that consistent renewals without notice create an expectation of renewal requiring justification.

“The long-standing, uninterrupted and consistent practice of renewing or extending the grievants’ contracts would have surely led the grievants to believe that their last contracts would be renewed, more so in the absence of any reasonable notice to the contrary given to them by the appellant…Having established the existence of a legitimate expectation of renewal on the part of the grievants, the appellant had to prove the reasons for terminating the employment relationship.”

The Court emphasized that legitimate expectation is grounded in reasonableness and fair dealing, and that employers must justify non-renewal where such expectations exist.This means employers cannot create a pattern of renewals and then abruptly terminate without warning.

3. Contractual Renewal Clauses

Mweni v Child Welfare Society of Kenya [2025] KEELRC

In this case, the ELRC Court held that where the terms of a fixed-term contract provide for renewal based on performance, availability of funds, conduct of the employee, productivity to the organization, and human resource needs, an employee had a legitimate expectation that an employer would follow the pre-requisite considerations for renewal outlined in the contract.

Failure to demonstrate adherence to the conditional renewal clauses in the fixed-term contract amounts to unfair termination.

Conflicting Judicial Position

Transparency International – Kenya Vs Omondi [2023] eKLR

In this case, the Court of Appeal departed from the decisions in Changalwa and Keen Kleeners above, affirming that legitimate expectation generally does not arise in fixed term contracts. The Court of Appeal held as follows:

“We quote the above findings of the learned judge with approval and hold that there are no reasons that we can discern, that would make one depart from those findings. Indeed, the doctrine of legitimate expectation does not arise in the renewal of a fixed-term contract and its non-renewal cannot constitute unfair termination or dismissal. Having noted that the respondent was in employment under a fixed-term contract and that the contract came to an end at the appointed time, we are of the view that any relief sought by the respondent on basis of her assertion that her employment was unfairly terminated was automatically not available to her.”

CONCLUSION

Fixed-term contracts in Kenya are, by their nature, time-bound engagements that ordinarily terminate automatically upon expiry. However, the doctrine of legitimate expectation introduces an important qualification grounded in fairness and reasonableness.

Ultimately, until the Supreme Court definitively reconciles these competing lines of authority, the doctrine of legitimate expectation will continue to operate as a context-driven exception to the general rule on fixed-term contracts one that demands careful navigation by employers and employees alike.

Ultimately, in Kenyan employment law, what is written in the contract may not always be the end of the story conduct matters too.

 

At SSM Law Advocates, we provide comprehensive legal support in all matters relating to employment and labour law. Our team of skilled employment lawyers advises both employers and employees on the drafting, review, and enforcement of employment contracts, including probationary and permanent contracts. We ensure that the employment contracts of our clients are fully compliant with the Employment Act, the Constitution, and evolving judicial interpretations. Whether you’re looking to implement sound HR practices, navigate employee laws, or resolve workplace disputes, we help you mitigate risk, maintain regulatory compliance, and uphold fair labour standards at every stage of the employment relationship.

If you require structured legal guidance on termination of fixed-term contracts in Kenya, our experienced legal team is available to assist. Contact: smusembi@ssmlawadvocates.com; pgatua@ssmlawadvocates.com

Contributors:

Peter Njoroge Gatua – Legal Associate

Gloria Samba – Trainee Advocate

Disclaimer

This article is for informational purposes only and should not be construed as legal advice.