# Termination of Employment Kenya: Procedure

> An employer's guide to fair termination in Kenya: hearings, notice, redundancy, final dues, certificates of service and records.

Original page: https://cazini.co.ke/guides/termination-of-employment-kenya-procedure  
Updated: 2026-11-13 · Cazini (Paul Omondi)

To terminate employment fairly in Kenya, an employer must have a valid and fair reason and follow a fair procedure. For misconduct, poor performance or physical incapacity, explain the proposed reason, allow the employee to be accompanied, and hear their response before deciding. Then apply the relevant notice rules, reconcile terminal dues and issue a certificate of service where required; redundancy follows a separate statutory process.

## Choose the correct termination route

Sections 43 and 45 of the Employment Act require the employer to prove the reason for termination and show that both the reason and procedure were fair. A termination letter or notice payment does not establish either requirement by itself.

| Situation | Route to assess |
| --- | --- |
| Misconduct | Investigate the allegation and follow the section 41 hearing process before deciding. |
| Poor performance or physical incapacity | Explain the concern and hear the employee under section 41 before deciding. |
| Fundamental breach of employment obligations | Assess summary dismissal under section 44, while observing section 41. |
| Operational requirements or removal of roles | Assess redundancy under section 40, including notifications, selection and payments. |

Do not use ordinary notice as a substitute for identifying the real reason. For fixed-term expiry, probation or mutual separation, review the specific contract and applicable legal position rather than automatically applying the disciplinary checklist below.

## Prepare evidence before issuing allegations

Build a file that connects the proposed reason to the employee's actual duties and the evidence. Section 43 places the burden of proving the termination reason on the employer.

For misconduct, collect the relevant policy, incident records, attendance information, correspondence and witness accounts. For performance concerns, assemble the job description, communicated expectations, work results and records of feedback or support. For incapacity, distinguish evidence about the employee's ability to perform the role from assumptions about their condition.

As a practical control, prepare a short investigation summary separating established facts, disputed facts and missing information. Do not write the dismissal decision at this stage. Use a controlled [employee-management record](https://cazini.co.ke/employee-management) so that HR can retrieve the evidence relied on without searching personal inboxes.

## Run the pre-decision process

Section 41 requires an explanation in a language the employee understands, the opportunity to have another employee or shop-floor union representative present, and genuine consideration of their responses. The following documents help demonstrate that process; their suggested contents are an HR working checklist, not prescribed statutory templates.

### Show-cause letter

Set out:

- The specific conduct, performance concern or incapacity issue under consideration.
- The incidents or work results relied on, with the supporting documents identified.
- The duty, policy or expectation relevant to the concern.
- The explanation requested and how the employee should submit it.
- That the response will be considered before a decision is made.

Avoid a letter that announces termination and then asks the employee to defend themselves. The response must be capable of influencing the outcome.

### Hearing invitation and meeting

The invitation should identify the issues, meeting arrangements and documents to be discussed. State that the employee may have another employee or shop-floor union representative present.

At the meeting, explain the proposed reason in a language the employee understands. Hear both the employee and their representative, and consider what they say. Record the explanation, disputed evidence, questions and answers, rather than relying only on a signed attendance sheet.

As a practical safeguard, investigate material new information before deciding. A hearing record should show consideration, not merely that the employer read allegations aloud.

### Decision and outcome letter

Compare each allegation with the evidence and response. Record what is established, what remains unproven and why the chosen outcome follows.

The outcome letter should state the decision, reason, effective date, notice treatment and final-pay arrangements. Keep proof of delivery alongside the investigation, response, invitation, representation choice, minutes and decision rationale. These records help demonstrate the substantive and procedural fairness required by sections 43 and 45.

## Apply notice separately from the hearing

A show-cause letter invites a response. A termination notice communicates the decision and applicable notice period. They serve different purposes.

For indefinite-term contracts, the section 35 statutory minimum depends on the pay interval:

| Pay interval | Statutory minimum notice |
| --- | --- |
| Daily paid | One day |
| Period exceeding one day but less than one month | Seven days |
| Monthly or at intervals of one month or more | 28 days |

A contract or CBA may require longer notice. Notice must be written, with its contents explained in a language the employee understands where necessary.

Under section 36, payment in lieu equals the remuneration the employee would have earned during the applicable notice period. It replaces working that period, not the fair-procedure requirement.

Summary dismissal under section 44 concerns a fundamental breach of contractual obligations. Examples include absence without leave or lawful cause, wilful neglect of duty and insubordination. It does not remove the section 41 process for misconduct dismissal.

## Follow the separate redundancy procedure

Redundancy should not be packaged as employee misconduct. Section 40 sets out a distinct route for the operational decision, affected employees and payments.

### Notify the appropriate parties

Give at least one month's written notice to the union and local labour officer for unionised employees. For non-unionised employees, notify each affected employee and the local labour officer.

Keep these notifications distinct in the file from termination notice or pay in lieu. A payroll payment alone does not demonstrate that the required parties were notified.

### Document selection and payments

Selection must have due regard to seniority in time and each employee's skill, ability and reliability within the affected class, unless the employer and union have agreed otherwise in a CBA.

As a practical control, define the affected class and record the evidence supporting selection. Avoid scores that cannot be traced to employment records.

Section 40 also requires accrued leave to be paid in cash, notice or pay in lieu, and severance of at least 15 days' pay for every completed year of service. Document completed service, the pay basis and any more generous contractual or CBA entitlement before approving the calculation.

## Reconcile final pay and close the file

Prepare an itemised reconciliation rather than one unexplained exit payment. Check earned wages, notice treatment, leave balances, redundancy severance where applicable, and any contractual gratuity or benefits promised by the contract or CBA. Route the approved schedule through [payroll](https://cazini.co.ke/payroll), keeping each payment category identifiable.

Service pay is not redundancy severance. Section 35 provides for service pay on termination after notice, on terms fixed by the contract or CBA, but excludes specified scheme members, including NSSF and registered pension or provident scheme members. Do not automatically add service pay to every exit calculation.

For ordinary salary take-home estimates, use the [Kenya PAYE calculator](https://cazini.co.ke/tools/kenya-paye-calculator). It does not determine termination entitlements or redundancy eligibility.

[Kenya PAYE calculator](https://cazini.co.ke/tools/kenya-paye-calculator) - work out net pay and every deduction for any salary.

Under section 51, issue a certificate of service unless employment lasted less than four consecutive weeks. Include the prescribed employment particulars without adverse comments about the employee.

Retain written employment records for five years after termination under section 74. Keep the final-pay reconciliation, payment evidence and certificate copy with the underlying employment and disciplinary records.

## Prepare for a complaint or challenge

An employee may complain to a labour officer or the Employment and Labour Relations Court. The Ministry's published individual-complaint process uses Form LD 64 and says that, if unresolved after seven days, the labour officer calls the parties for conciliation.

Nominate an HR contact who can produce the evidence, procedural record and payment schedule. Review any complaint against the actual file, not recollections of the meeting.

Section 49 provides for remedies including notice pay, earned wages, compensation of up to 12 months' gross monthly wages, reinstatement or re-engagement. Compensation is not automatically the maximum: relevant factors include service length, expectations of continued employment, procedural compliance and employee conduct.

## Sources

[Kenya Law - Employment Act, Cap. 226](https://kenyalaw.org/akn/ke/act/2007/11) - Fair reasons, hearings, notice, summary dismissal, service pay, remedies, certificates and records.
[Kenya Law - Employment Act, section 40](https://kenyalaw.org/akn/ke/act/2007/11#sec_40) - Redundancy notifications, selection criteria, accrued leave, notice and severance.
[State Department for Labour and Skills Development - Handling of Labour Disputes](https://labour.go.ke/handling-labour-disputes) - Individual complaint registration and conciliation process.

## Frequently asked questions

### Is a disciplinary hearing mandatory before dismissal in Kenya?

Section 41 requires an explanation and an opportunity to respond before termination or summary dismissal for misconduct, poor performance or physical incapacity. Explain the reason in a language the employee understands, allow another employee or shop-floor union representative to attend, and hear and consider their responses.

### Can an employer terminate employment by paying notice alone?

Payment in lieu under section 36 replaces service of the notice period, not the need for a valid and fair reason or fair procedure. The amount is the remuneration the employee would have earned during the applicable notice period. Check the contract and CBA for a longer notice entitlement.

### Can an employer dismiss an employee without notice?

Summary dismissal is permitted under section 44 where the employee has fundamentally breached obligations under the contract of service. Examples include absence without leave or lawful cause, wilful neglect of duty and insubordination. For misconduct dismissal, the section 41 explanation and hearing requirements still apply.

### Is service pay the same as redundancy severance?

No. Redundancy severance is at least 15 days' pay for every completed year of service under section 40. Service pay is a separate section 35 entitlement, subject to its eligibility rules and exclusions, including NSSF membership and specified pension or provident schemes.

### How long can an employee take to bring a termination claim?

Employment Act claims generally must be filed within three years of the act, neglect or default complained of. A continuing-injury claim must be filed within 12 months after the injury ceases. Separately, section 74 requires employers to keep written employment records for five years after termination.