Termination of probationary contracts in Kenya explained. Protect your firm legally with expert advice. Book our team today for guidance!
Introduction
Probationary contracts in Kenya allow employers to assess the suitability of new hires before confirming them on permanent terms. However, probation does not give employers unfettered rights to dismiss employees at will. The Employment Act, 2007 provides a legal framework that must be followed when terminating a probationary contract. Failing to comply can expose employers to litigation, reputational damage, and costly claims at the Employment and Labour Relations Court.
How Do You Terminate a Probationary Contract in Kenya?
As leading employment lawyers in Kenya, we explain how employers can safely terminate probationary contracts while protecting their businesses from legal risk.
Legal Basis of Probation
Under Section 42 of the Employment Act, 2007:
- A probationary contract may not exceed six months, but can be extended once by up to six months with the employee’s consent.
- The maximum probationary period in Kenya is twelve months.
- Either party may terminate the contract by giving at least seven days’ notice in writing, or by paying seven days’ salary in lieu of notice.
Steps to Safe Termination of Probationary Contracts in Kenya
1. Issue a Written Notice
Provide the employee with a minimum of seven days’ written notice. If the contract specifies a longer period, follow that. Alternatively, you may pay seven days’ salary in lieu of notice.
2. Document the Reasons
Although probationary termination does not require the “valid and fair reason” test of Section 43 in full, it is best practice to document performance or conduct issues. This protects the employer if the matter escalates.
3. Respect Procedural Fairness
While Section 42 exempts probation from the full application of Section 41 (disciplinary hearing requirements), Kenyan courts increasingly expect employers to accord basic fairness. Invite the employee to a short performance review meeting, allow them to respond, and keep minutes.
4. Confirm Timelines
Ensure the termination is effected within the probation period. If probation has lapsed and was not extended in writing, the employee is automatically deemed confirmed — making termination subject to strict unfair dismissal laws.
5. Pay Accrued Entitlements
Settle any accrued salary, leave days (if earned), or other benefits up to the date of termination. Failure to pay lawful dues can attract penalties and claims.
Conclusion
Terminating a probationary contract in Kenya is legally permissible, but it must be done carefully. Employers should respect statutory notice periods, act within the probation timeline, and follow fair procedures to avoid claims of unfair labour practices. For employees, it is important to know your rights during probation and what remedies are available if the law is breached.
Facing Corporate Employment Legal Matter?
At F.M. Muteti & Co. Advocates, we provide expert guidance on employment contracts, probationary termination, workplace policies, and labour disputes across Kenya. Whether you are an employer seeking compliance or an employee protecting your rights, our team of experienced employment lawyers in Nairobi, Mombasa, and across the country is here to help.
Common FAQS: Termination of Probationary Contracts in Kenya
How Do You Terminate a Probationary Contract in Kenya?
To terminate a probationary contract in Kenya, an employer or employee must provide at least 7 days’ written notice or payment in lieu of notice, as stipulated by Section 42(2) of the Employment Act. This notice can be served at any point during the probationary period. The termination should be done in writing, clearly stating the reason for termination. While the process is less formal than terminating a permanent contract, it must still be fair and justifiable. It’s crucial for the employer to act in good faith and avoid discriminatory or unlawful reasons for termination.
What Are the Grounds for Termination of Probationary Employment?
The primary ground for terminating probationary employment is unsuitability for the job. This can be due to various factors, including:
- Failure to meet performance targets or expectations.
- Poor attitude or inability to work well with others.
- Incompetence or lack of the required skills.
- Breach of company policies or rules.
While an employer is not required to follow the extensive disciplinary procedures outlined in Section 41 of the Employment Act for terminating a probationary employee, the termination must still be for a valid reason and not based on unlawful grounds such as discrimination. The employee’s unsuitability should be clearly documented and communicated.
Can I Terminate My Contract in the Probation Period?
Yes, as an employee, you can terminate your contract during the probation period. You are required to give the employer 7 days’ written notice or provide payment in lieu of notice. There is no legal obligation to state a reason for your resignation during this period.
Can You Terminate an Employee in a Probation Period?
Yes, an employer can terminate an employee during the probation period. The employer must provide at least 7 days’ written notice or payment in lieu of notice. The termination should be based on a valid reason, primarily the employee’s unsuitability for the role, and must not be for an unlawful reason such as discrimination.
What Is Termination During Probation?
Termination during probation is the legal process by which either an employer or employee ends the employment relationship before the probationary period concludes. It’s a less formal process than terminating a permanent employee, designed to allow both parties to assess the suitability of the employment relationship. The key legal requirements are a valid reason for termination (for the employer) and the provision of at least 7 days’ written notice or payment in lieu.
What Is Section 41 of the Employment Act in Kenya?
Section 41 of the Employment Act outlines the procedural fairness requirements for terminating an employee on grounds of misconduct, poor performance, or physical incapacity. This section mandates a formal disciplinary process, including:
- Explanation: The employer must explain the reason for the intended termination in a language the employee understands.
- Right to be Heard: The employee has the right to be heard in the presence of a fellow employee or a shop floor union representative.
- Consideration: The employer must consider the employee’s representations before making a final decision.
It is critical to note that Section 42(1) of the Employment Act expressly states that the requirements of Section 41 do not apply to the termination of an employee on probation. This is the legal distinction that makes probationary termination less procedurally cumbersome for employers, though a valid reason for termination is still a legal requirement.