Court Reaffirms Employer Disciplinary Autonomy, Internal Grievance Procedures and the Exceptional Nature of Interlocutory Reinstatement
On 12th June 2026, the Court of Appeal delivered a significant judgment in Edelvale Trust Jamaa Home & Mission Hospital v Sarah Nduta Thenya & 2 Others (Civil Appeal No. 149 of 2020) [2026] KECA 1110 (KLR), providing important guidance on the circumstances in which courts should intervene in employment disciplinary processes through interlocutory relief.
The Court reaffirmed that employment relationships are fundamentally contractual and that employers retain legitimate managerial authority to investigate alleged misconduct, administer disciplinary processes and make employment decisions, subject to the Constitution, the Employment Act, 2007, the terms of the employment contract and the requirements of procedural fairness.
Equally significant is the reaffirmation of the doctrine of exhaustion being contractual internal grievance and dispute-resolution mechanisms. Where an employment relationship provides a genuine internal mechanism for addressing workplace disputes, employees should ordinarily utilise and exhaust that mechanism before seeking judicial intervention, unless there are exceptional circumstances that justify bypassing it.
Importantly, the Court reiterated that interlocutory relief should preserve the subject matter of litigation rather than determine the substantive dispute. Mandatory orders having the practical effect of reinstating an employee therefore remain exceptional.
Background
The dispute arose in the context of disciplinary action taken against the employees. The employees sought interim relief from the Employment and Labour Relations Court (ELRC), including orders that effectively restrained the employer from proceeding with the disciplinary process and restored aspects of the employment relationship pending determination of the substantive dispute.
The ELRC granted interlocutory orders in favour of the employees. The employer appealed to the Court of Appeal, challenging the basis upon which the interim relief had been granted.
The central question before the Court of Appeal was therefore not simply whether the employer's disciplinary action was ultimately lawful, but whether the circumstances justified judicial intervention before the substantive employment dispute had been fully heard and determined.
The Court's determination
The Court of Appeal allowed the employer's appeal, set aside the interlocutory orders issued by the ELRC and dismissed the employees' application for interim relief. In reaching its decision, the Court considered the contractual grievance mechanism, the principles governing interlocutory injunctions, the scope of managerial prerogative and the exceptional nature of mandatory interlocutory orders.
(1) Internal grievance procedures should ordinarily be exhausted
The Court emphasised that where an employment contract provides a genuine internal grievance or dispute-resolution mechanism, parties should ordinarily utilise that mechanism before seeking judicial intervention.
Such procedures form part of the contractual framework governing the employment relationship and should not ordinarily be disregarded without good reason. Judicial intervention may nevertheless be appropriate where an internal mechanism is unavailable, ineffective or incapable of preventing manifest injustice.
The decision therefore reinforces the importance of contractual autonomy and effective internal workplace dispute-resolution mechanisms
(2) Courts should exercise restraint over disciplinary processes
The Court recognised that investigating misconduct, suspending employees where appropriate and administering disciplinary proceedings are legitimate managerial functions. Courts should therefore be slow to interfere with ongoing disciplinary processes at an interlocutory stage, particularly where the underlying facts remain contested.
This does not give employers unfettered discretion. Managerial prerogative remains subject to statutory, constitutional and contractual obligations, including the requirements of procedural fairness under the Employment Act, 2007.
(3) Interlocutory relief must correspond with the relief sought in the main claim
The Court also considered the requirements governing interlocutory injunctions under Rule 17(5) of the Employment and Labour Relations Court (Procedure) Rules, 2016, now reflected in Rule 45(5) of the 2024 Rules.
The Court reaffirmed that interim relief should ordinarily correspond with the substantive relief sought in the main proceedings. An interlocutory application should not be used to obtain remedies that are materially different from, or unsupported by, the principal claim.
The decision consequently highlights the importance of carefully drafted pleadings when seeking interim relief.
(4) Employment relationships remain predominantly contractual and commercial
Applying the well-established principles in Giella v Cassman Brown & Co. Ltd [1973] 1 EA, the Court reaffirmed that employment relationships are fundamentally contractual and commercial in nature. Consequently, where disciplinary action, suspension or termination is ultimately found to be unlawful, the resulting loss will ordinarily be capable of compensation through an award of damages.
The Court rejected the proposition that financial hardship arising from suspension or termination automatically constitutes irreparable injury warranting interlocutory relief. Instead, applicants seeking injunctions must demonstrate harm that cannot adequately be remedied through monetary compensation.
In the Court's view, the alleged losses arising from the suspension and any ensuing termination were capable of financial assessment and compensation should the employees ultimately succeed at trial.
The decision therefore restores emphasis to the traditional equitable principles governing injunctions while confirming that employment disputes are not exempt from those principles merely because constitutional rights are engaged.
(5) Interim reinstatement remains an exceptional remedy
The Court further reaffirmed that mandatory interlocutory orders which have the practical effect of reinstating an employee should only be granted in exceptional circumstances.
Such orders may substantially determine the dispute before the evidence has been tested at trial. Where material facts are contested or the dispute raises issues requiring oral evidence and assessment of credibility, interim reinstatement will ordinarily be inappropriate.
The Court considered that the dispute before it involved factual issues that required determination at a full hearing and that the ELRC had therefore gone beyond the proper scope of interlocutory intervention.
Why the decision matters
The decision provides greater clarity on the balance between employee protection and employer managerial autonomy.
For employers, it reinforces the importance of maintaining clear disciplinary, grievance and appeal procedures and ensuring that these are consistently implemented and properly documented.
For employees and employment practitioners, the decision underscores the importance of considering and, where appropriate, exhausting available contractual remedies before approaching the courts. It also highlights the need to ensure that interlocutory relief is properly supported by the substantive pleadings and the established principles governing injunctions.
More broadly, the judgment confirms that interlocutory proceedings should not ordinarily be used to determine contested employment disputes prematurely. Judicial intervention should complement and not replace effective workplace governance and contractual dispute-resolution mechanisms.
CM Advocates LLP perspective
The decision is a useful reminder that effective workplace governance is an important part of employment risk management.
Employers should ensure that employment contracts and workplace policies contain clear and workable disciplinary, grievance and appeal procedures, and that managers and HR teams are trained to apply those procedures fairly and consistently.
At the same time, the decision does not diminish employees' statutory or constitutional protections. Employers must continue to comply with the Employment Act, contractual obligations and the requirements of procedural fairness when taking disciplinary action.
The key lesson is therefore one of balance: employers retain legitimate managerial authority, while employees remain protected against unlawful and procedurally unfair employment action.
How we can assist
CM Advocates LLP's Employment, Pensions & Rewards (EPR) Practice Group provides integrated legal, regulatory and strategic advisory services across the full spectrum of employment law, workplace governance, pensions, executive compensation, employee relations and workforce risk management.
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