Kitui Flour Mills Loses Court Appeal Over Constructive Dismissal of 69-Year-Old Employee

Kitui Flour Mills ignored two letters from a 69-year-old employee challenging his transfer from Kisii to Bondo. The court found that the company breached his contract, upholding a KSh249,270 award for constructive dismissal.

A workplace transfer intended to last three months has cost Kitui Flour Mills Ltd a costly legal battle.

The company lost its appeal after a court found that it constructively dismissed a 69-year-old employee.

Justice Nzioki wa Makau upheld an earlier judgement favouring Abdul Mohamed Khalid.

The Employment and Labour Relations Court also awarded him costs of the appeal.

At the centre of the dispute was an apparently straightforward management decision.

However, the company overlooked a crucial provision governing transfers in Khalid’s employment contract.

The clause required mutual agreement before deployment to another workplace.

Despite that condition, management transferred him from Kisii to Bondo without consultation.

The judge found that the company’s conduct amounted to a fundamental breach.

He consequently upheld the finding that Khalid had been constructively dismissed.

Contract Breached

Khalid joined Kitui Flour Mills on October 1, 2022, as a driver. His principal workplace was Kisii, where he served until February 2024.

On February 12, 2024, the company informed him about his transfer. The assignment involved reporting to Bondo for approximately three months.

Khalid objected, explaining that relocating his family required adequate preparation. He also complained that colleagues received more time to organise their relocations.

Rather than rejecting the deployment outright, he requested reconsideration. He subsequently wrote to management seeking consultation over the proposed transfer.

His employment contract became central to the ensuing disagreement. Clause 4 permitted deployment elsewhere but expressly required mutual agreement.

Khalid maintained that management had ignored this contractual safeguard. He also argued that the company’s transfer policy required consultation before implementation.

However, the company maintained that operational demands justified the temporary deployment.

Its witness, Anwar Hassan, said Bondo urgently needed additional personnel.

Hassan testified that transport and accommodation were available for Khalid.

He further maintained that the employee declined because he needed additional time.

But cross-examination exposed significant weaknesses in the company’s defence.

Hassan admitted that management had not responded to Khalid’s correspondence.

He also acknowledged that no engagement preceded the transfer decision.

Those admissions would later become important in determining the appeal.

Ignored Letters

Khalid’s first letter seeking reconsideration was dated February 12, 2024. He subsequently wrote another letter on March 20, 2024.

The company failed to respond to either communication. Khalid argued that management had effectively disregarded his attempts at resolving the disagreement.

He maintained that the transfer disregarded his family obligations and health challenges. He consequently argued that the circumstances made continued employment untenable.

Kitui Flour Mills, however, characterised his departure as voluntary abandonment. It insisted that Khalid had stopped reporting without being dismissed.

The magistrate rejected that argument in a judgement delivered February 11, 2026.

Senior Resident Magistrate John Nyariki found that the company constructively dismissed Khalid.

The magistrate awarded KSh41,545 for 21 untaken leave days. He also granted KSh29,675 as salary in lieu of notice.

Additionally, the employee received KSh178,050 in compensation for unfair termination.

That represented six months’ salary, bringing the total award to KSh249,270.

The company subsequently challenged the entire decision before the appellate court.

Legal Test

Kitui Flour Mills argued that the magistrate misapplied constructive dismissal principles.

It maintained that dissatisfaction with management decisions did not establish unlawful termination.

The company also challenged the application of Section 41. It argued that no disciplinary proceedings or express dismissal had occurred.

Further, it disputed the compensation and leave awards. It maintained that Khalid had failed to establish his entitlement sufficiently.

Khalid opposed the appeal, insisting that contractual obligations remained binding. He argued that the dispute concerned consultation, not managerial transfer powers.

Justice Makau approached the matter as a first appellate court. He reconsidered the evidence while acknowledging that he never observed witnesses testify.

The judge identified constructive dismissal as the central question. He explained that employers can effectively terminate contracts through fundamental breaches.

The judgement identified two principal circumstances supporting constructive dismissal. These involve unilateral contractual alterations and intolerable working conditions imposed upon employees.

The court found that Khalid’s circumstances satisfied the first consideration. The company had altered his working arrangements without obtaining the required agreement.

Justice Makau described the circumstances as a “classical case of repudiation of contract”. He found that the transfer effectively undermined the agreement between employer and employee.

The judge also referred to Coca-Cola East & Central Africa Limited v Maria Kagai Ligaga [2015] eKLR. That decision provides important guidance on constructive dismissal under Kenyan employment law.

The court found that the Bondo transfer breached Khalid’s contractual expectations. The absence of consultation and unanswered correspondence reinforced that conclusion.

Appeal Dismissed

In paragraph 25, Justice Makau delivered the judgement’s most consequential finding. He observed that the employer was effectively terminating the contract through its conduct.

The judge therefore rejected the company’s argument that Khalid had simply abandoned employment. His departure followed conduct that fundamentally breached the contractual relationship.

Having reconsidered the evidence, the appellate court found no justification for interference. Justice Makau concluded that the magistrate had reached a legally sound decision.

In paragraph 26, the judge stated that the decision “cannot be disturbed on appeal”. He consequently dismissed the appeal with costs to Khalid.

The judgement was dated and delivered at Nakuru on October 29, 2026. It leaves the original monetary award and accompanying costs and interest undisturbed.

The decision offers an important warning to employers exercising workplace transfer powers.

Operational convenience cannot automatically override express contractual conditions governing employee deployment.

READ ALSO: Bingwa Flour Maker Ordered to Pay Former Manager KSh2.2 Million for Pregnancy Discrimination

Although employers retain managerial discretion, they must respect agreed employment terms.

Where contracts require mutual agreement, consultation cannot simply become an afterthought.

For Kitui Flour Mills, a temporary staffing decision became an expensive legal dispute. For Khalid, the judgement vindicated his insistence on contractual consultation.

Ultimately, the ruling reinforces a fundamental principle governing employment relationships.

An employer cannot unilaterally rewrite contractual obligations simply because operational demands change.

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