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ELRCPartially AllowedMemorandum of Claim filed 20th June 2013 (ELRC, Nairobi)· [2019] KEELRC 65 (KLR)

Dick Wekesa Waswa v GSI Kenya Limited [2019] KEELRC 65 (KLR)

Employment and Labour Relations Court
20 December 2019
3,758 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court ruled a CEO's dismissal unfair because the employer never gave him a proper hearing, awarding about Kshs. 3.3 million.

What this practically means

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Executive summary

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The claimant, formerly Chief Executive Officer of the Respondent, challenged his summary dismissal of 11th June 2013 as unlawful, discriminatory and procedurally unfair, seeking among other reliefs a declaration, an injunction against publication of his details, 18 years' salary (Kshs.69,573,600), three months' notice pay, pension contribution, days worked, leave allowance and various benefits. The Respondent defended the dismissal as lawful under the contract and section 44 of the Employment Act, asserting gross misconduct in the registration of members and loss of trust, and that dues had been offered. The court framed two issues: whether the dismissal was wrongful and whether the reliefs were due. On procedure, the court found the 24th May 2013 meeting could not be a disciplinary hearing because no allegations had been communicated to the claimant; allegations were only furnished on 27th May 2013, the documents he requested were never supplied, and no hearing followed his response. The Investigation Committee's Report was not produced, and the grounds in the dismissal letter differed from those in the show cause letter, so no valid reason was proved. Applying section 41 as mandatory and section 45, the court declared the summary dismissal unfair. On remedies, the 18 years' salary prayer was rejected as unanchored in law; instead the court awarded six months' salary as compensation under sections 12 of the ELRC Act and 49 of the Employment Act, plus three months' notice pay, admitted pension of Kshs.19,000, 11 days' salary and service pay, totalling Kshs.3,340,505, with interest, costs to the claimant and a certificate of service. Other benefit claims failed for want of proof.

Key legal issues

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01

Whether the summary dismissal was procedurally fair under section 41 of the Employment Act

Holding

The dismissal was procedurally unfair: no hearing was conducted after the claimant responded to the charges; the show-cause meeting of 24th May 2013 was not a disciplinary hearing because no allegations had been communicated; documents requested to prepare a response were never supplied

Reasoning

The claimant was suspended on 7th May 2013 without specific allegations. He repeatedly requested particulars. The 24th May meeting could not be a hearing as he did not know what to answer. Allegations were only provided on 27th May 2013; after his response of 29th May requesting documents which were never supplied, no further disciplinary meeting was convened before dismissal on 11th June 2013.

p. 4
02

Whether there was a valid and fair reason for termination under section 45 of the Employment Act

Holding

No valid reason was proved; the grounds of termination differed from those in the show cause letter and the Investigation Committee's Report was not produced in court

Reasoning

The respondent relied on registration of new members and loss of trust, but RW1 admitted he did not know if the claimant personally benefitted and performance had improved. The Investigation Committee's Report leading to dismissal was not produced. The dismissal letter cited grounds different from the show cause letter, so the employer failed to prove a valid, fair reason under section 45.

p. 5
03

The measure of compensation for unfair termination

Holding

The 18-years'-salary prayer was refused; compensation is limited to a maximum of 12 months' salary under section 49(1)(c), and 6 months' salary was awarded considering section 49(4) factors

Reasoning

Section 12 of the ELRC Act and section 49 of the Employment Act guide remedies. Compensation cannot exceed 12 months' gross salary. Weighing the manner of loss of employment, the claimant's treatment and his position, the court exercised discretion to award 6 months' salary of Kshs.1,932,600.

p. 5
04

Entitlement to notice pay, service pay, 11 days' salary and admitted dues

Holding

The claimant, contractually entitled to 3 months' notice, was awarded Kshs.966,300 in lieu of notice; 11 days' salary of Kshs.261,555 and service pay of Kshs.161,050 were awarded as the respondent had offered to pay them; admitted pension of Kshs.19,000 was awarded

Reasoning

Having found the termination unfair, notice pay follows under section 49(1)(a). The respondent's tabulation offered 11 days' salary and service pay, which the court treated as payable by agreement. The admitted pension sum of Kshs.19,000 was awarded although the larger pension claim was unproved.

p. 5

Legal principles established

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  • An employer must, before terminating employment for misconduct, explain the reasons to the employee and hear and consider their representations; failure to follow section 41 renders termination procedurally unfair
  • An employer bears the burden of proving both a valid reason and a fair procedure under section 45 of the Employment Act
  • Compensation for unfair termination is capped at twelve months' gross salary under section 49(1)(c) of the Employment Act

Court orders

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  1. 1.A declaration/finding that the summary dismissal of the claimant by the respondent was unfair
  2. 2.Award of Kshs.3,340,505 comprising: 6 months' salary as compensation (Kshs.1,932,600); 3 months' salary in lieu of notice (Kshs.966,300); pension contribution admitted by respondent (Kshs.19,000); 11 days worked in June 2013 (Kshs.261,555); service pay (Kshs.161,050)
  3. 3.Respondent to pay claimant's costs of the suit
  4. 4.Decretal sum to accrue interest at court rates from date of judgment until payment in full
  5. 5.Respondent to issue a certificate of service to the claimant
Jurisdiction invoked
Section 12 of the Employment and Labour Relations Court Act; Articles of the Employment Act, 2007 (ss. 41, 44, 45, 49)

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Dick Wekesa Waswa v GSI Kenya Limited [2019] KEELRC 65 (KLR)", Case Analysis (2019). Memorandum of Claim filed 20th June 2013 (ELRC, Nairobi). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/65/eng@2019-12-20

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.