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ELRCPartially AllowedNot stated in the judgment· [2023] KEELRC 2744 (KLR)

Maina v Retriever Limited (Employment and Labour Relations Cause E607 of 2020) [2023] KEELRC 2744 (KLR)

Employment and Labour Relations Court
2 November 2023
BMB. O. M. Manani
4,348 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~17 min to read original · ~4 min brief

The bottom line

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A Kenyan court upheld an employee's dismissal for misconduct but awarded compensation because the employer blocked his right to appeal the decision.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent as Key Account Manager Sales and later National Sales Manager, was terminated on 18th October 2019 following allegations that he received Ksh. 32,000.00 from a client without authority and failed to remit it, and that he irregularly processed commission payments to one Lucy Kamau in respect of the Respondent's existing direct clients. He claimed the termination was unfair and pre-determined, supported by a witness who had sat on the disciplinary panel and described the hearing as a sham. The court framed two issues: whether the contract was unlawfully terminated, and the parties' entitlement to reliefs. Applying the balance-of-probabilities standard and the range of reasonable responses test drawn from Kenya Revenue Authority v Reuwel Waithaka Gitahi, the court found the Respondent had credible substantive grounds - the Claimant's materially inconsistent accounts of the cash, and his failure to justify the commission payments - constituting gross misconduct under section 44(4)(g) of the Employment Act. It disbelieved the Claimant's witnesses, whose evidence was compromised by their departures from the Respondent. Procedurally, the court found due process substantially followed, but the termination letter's declaration that the decision was 'not reversible' denied the Claimant the statutory right of appeal, contrary to section 45(5) of the Employment Act and section 4 of the Fair Administrative Action Act. Balancing the scales, the court awarded the Claimant one month's salary (Ksh. 150,000.00) as nominal compensation, with interest at court rates, subject to statutory deductions, and awarded him half the costs of the suit.

Key legal issues

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01

Whether there were valid substantive grounds for termination

Holding

Yes. The Respondent genuinely believed on credible evidence that the Claimant misappropriated company cash and irregularly procured commission payments, amounting to gross misconduct under section 44(4)(g) of the Employment Act.

Reasoning

The Claimant gave materially inconsistent accounts within one month of how he handled Ksh. 32,000.00 received from a client. His witness's testimony on remittance of the full amount was contradicted by her own police statement and of low probative value. He offered no cogent evidence justifying commission payments to Lucy Kamau on business from an existing direct client, Agrichem Africa. Together these provided a credible basis for the Respondent's belief that misconduct occurred.

p. 6
02

Whether due process was followed in the termination

Holding

Substantially yes, except that the Respondent denied the Claimant the right of appeal by declaring the decision 'not reversible', breaching section 45(5) of the Employment Act and section 4 of the Fair Administrative Action Act.

Reasoning

The Claimant was suspended, issued a show cause letter, given five days to respond, invited to a disciplinary session seven days later with notice of his right to representation, and heard by a panel whose minutes the court found genuine. However, the termination letter declared the decision irreversible, denying the statutory right of appeal. This procedural lapse at the tail end of the process did not invalidate the termination but warranted a compensatory award.

p. 8
03

Whether the disciplinary hearing was a sham or pre-determined

Holding

No. The court disbelieved the Claimant's panelist witness and accepted the minutes as genuine.

Reasoning

The panelist witness gave contradictory evidence and had resigned from the Respondent under unclear circumstances, casting doubt on her motive. Her 'Damascus moment' conversion against a process she had participated in was treated with caution. The fact that the termination letter was prepared on the same day as the hearing was not incredible. The court accepted that the session convened and that the letter issued shortly after it.

p. 7

Legal principles established

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  • An employer must demonstrate both a valid substantive ground and procedural fairness (including the right of appeal) to justify termination; denial of the right of appeal offends procedural fairness and attracts at least nominal compensation.
  • The standard of proof for the substantive reason for termination is the balance of probabilities, and the employer need only show it genuinely believed the ground existed (section 43(2), Employment Act).
  • An employment tribunal must not substitute its own view for that of the employer but ask whether the dismissal fell within the band of reasonable responses of a reasonable employer.

Court orders

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  1. 1.The Respondent's decision to terminate the Claimant's contract is faulted only to the extent that the Respondent deprived the Claimant of the right to challenge the decision on appeal.
  2. 2.The Claimant is awarded compensation equivalent to one month's salary, Ksh. 150,000.00.
  3. 3.The award attracts interest at court rates from the date of the decision.
  4. 4.The award is subject to applicable statutory deductions.
  5. 5.The Claimant shall recover half costs of the suit.
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over unfair termination claims under the Employment Act

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, "Maina v Retriever Limited (Employment and Labour Relations Cause E607 of 2020) [2023] KEELRC 2744 (KLR)", Case Analysis (2023). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/2744/eng@2023-11-02

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