Court Rules Fired Employees Cannot Demand Salaries Until Retirement

The Employment and Labour Relations Court in Kericho has ruled that employees who are unfairly dismissed cannot automatically claim salaries and benefits up to their retirement age.

In a landmark judgment in AIC Litein Hospital v Paul Bett (2026), the court upheld a finding that the employee had been unfairly terminated.

However, it significantly reduced the compensation awarded by a lower court, emphasizing that damages for unfair termination must remain within the limits set by the Employment Act.

Background of the Case

The dispute involved Paul Bett, an Accounts Clerk at AIC Litein Hospital, who was dismissed over alleged irregularities in transport reimbursements linked to a paediatric clinic programme.

The hospital claimed that transport allowances had been paid to 70 participants, yet only 34 people allegedly attended the event.

The management accused Bett of being responsible for the discrepancy and terminated his employment.

A lower court later found the dismissal unfair and awarded Bett substantial compensation, including future earnings and benefits extending to his retirement age.

The hospital appealed the decision, arguing that both the finding of liability and the amount awarded were excessive.

Also Read:Court Upholds Ksh 4.7M Award for Employee Fired Through Newspaper Advert While on Sick Leave

Court Finds Misconduct Was Not Proved

Justice Anna Ngibuini Mwaure agreed that the hospital had followed much of the required disciplinary procedure under Section 41 of the Employment Act.

However, the judge found that the employer failed to prove the allegations against Bett as required under Sections 43 and 45 of the law.

According to the court, evidence presented by the hospital’s own witnesses was inconsistent and failed to conclusively link the employee to the alleged loss of funds.

The court stressed that employers must support allegations of misconduct with credible evidence rather than assumptions or suspicion.

“The employer failed to establish valid and substantive grounds for dismissal.”

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 Future Salary Claims Rejected 

While confirming that the dismissal was unfair, the court rejected several of the employee’s claims for compensation.

Justice Mwaure struck out awards relating to future salaries, retirement benefits, medical allowances and most leave claims.

The court maintained that employment relationships are not guaranteed to continue until retirement and that compensation for unfair termination cannot be calculated on the assumption that an employee would have remained in the job indefinitely.

“No employment is permanent and damages cannot run to retirement age.”

Compensation Reduced

After reviewing the case, the court reduced the award to:

• One month’s salary in lieu of notice;
• Seven months’ salary as compensation for unfair termination; and
• Limited accrued employment benefits.

The total award amounted to Ksh 577,775.07

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Employment and Labour Relations Court Setting
PHOTO/Kericho Court