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Court backs UN sacoo’s decision not to renew contract of chief executive
Dr Avutswa had alleged defamation after the Sacco wrote to the Sacco Societies Regulatory Authority (Sasra) explaining its decision not to renew his contract.
The Employment and Labour Relations Court has upheld the decision of the United Nations Sacco not to renew the contract of its former chief executive officer, dismissing claims of unfair labour practices, defamation, and constitutional violations.
In its ruling, the court found that the sacco acted lawfully in declining to extend Nebart Avutswa’s three-year fixed-term contract, which expired in November 2024.
The court emphasised that renewal of such contracts is discretionary and that the sacco had not created any legitimate expectation of renewal.
"The petitioner was serving on a fixed-term contract which expired by effluxion of time," the court stated, adding that an employer is "generally not obligated to renew a fixed-term contract."
Dr Avutswa had contested the decision, arguing that his contract was renewable based on satisfactory performance—a standard he claimed to have met. He cited strong appraisal scores, performance bonuses, and the sacco’s growth during his tenure as evidence.
However, the court noted that performance assessments were conducted using the balanced scorecard framework, with Dr Avutswa’s full participation.
While he disputed the results, the court ruled that the board was not obliged to accept his self-evaluation.
He appeared before the board in August 2024, made a presentation on his performance, and submitted a self-evaluation scoring 4.14 out of 5 (83 percent), reflecting that he had exceeded expectations. Notwithstanding this, the board awarded him a score of 2.48 out of 5 (50 percent), which he contended was unfair, malicious, and predetermined.
"The respondents were not obligated to agree with him, given that the respondent was the assessor," the judgment read.
On the issue of legitimate expectation, the court referenced legal precedent, stating that such an expectation arises only when an employer actively leads an employee to believe renewal is guaranteed. The court found no such assurance in this case.
"The respondents also never led the petitioner into believing that his contract was to be renewed, and the issue of legitimate expectation does not arise," the ruling stated.
Additionally, the court dismissed Dr Avutswa’s claim that his constitutional rights—including fair labour practices under Article 41—were violated.
It held that the mere expiry of a fixed-term contract does not constitute a constitutional breach.
Dr Avutswa had also alleged defamation after the Sacco wrote to the Sacco Societies Regulatory Authority (Sasra) explaining its decision not to renew his contract. He argued that the letter harmed his professional reputation and employability.
The court rejected this claim, noting that Dr Avutswa had first written to Sasra protesting the board’s decision. The Sacco’s response, the judge clarified, was made at the regulator’s request and shared only with Sasra.
"This was the reasonable way to respond," the court held, adding that the information was not disseminated beyond the regulator. Ultimately, the court concluded that Dr Avutswa’s petition lacked merit.
