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ELRCPartially AllowedNot stated in judgment as extracted· [2023] KEELRC 3323 (KLR)

Omanya v Kenya Pipeline Company Limited (Employment and Labour Relations Cause 70 of 2017) [2023] KEELRC 3323 (KLR)

Employment and Labour Relations Court
21 December 2023
2,960 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya Pipeline must pay a wrongly dismissed security guard over Kshs 1.1 million because it neither proved theft allegations nor followed fair dismissal procedures.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent as a Security Guard II from 11th May 2007, was suspended on 2nd March 2016 to pave way for investigations into product theft at the PS-1 facility. He was issued a show cause letter on 20th May 2016 alleging complicity in theft syndicates between 2014 and 2015, responded on 24th May 2016, attended a disciplinary hearing on 9th June 2016 and was summarily dismissed on 21st July 2016. He appealed without success. The Respondent justified the dismissal on gross misconduct, wilful neglect, dishonesty and breach of staff rules and the CBA. At the hearing, it was not in dispute that the dismissal was substantively and procedurally unfair and unlawful: the theft allegations were not proved, the fairness test was not met, and Section 41 of the Employment Act's procedure was not followed. A related consolidated case against the same employer on the same cause of action had found dismissal unfair. Judgment was entered for the Claimant. Reinstatement was refused as statute-barred under Section 12(3)(vii) of the ELRC Act (dismissal over seven years old) and impracticable due to mistrust. The court awarded one month's salary in lieu of notice (Kshs 84,853.75) and twelve months' gross salary as compensation under Section 49 of the Employment Act (Kshs 1,018,254/-), totalling Kshs 1,103,107/75 with interest at court rates from the date of judgment. Service pay was refused as the Claimant was a member of the Respondent's retirement benefits scheme. Costs were awarded to the Claimant, and a certificate of service was ordered to be issued within thirty days.

Key legal issues

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01

Substantive and procedural fairness of the summary dismissal

Holding

The dismissal was substantively and procedurally unfair; the theft allegations were not proved and the Section 41 procedure was not followed

Reasoning

The court found it not in dispute that the dismissal was unfair. The reasons given (theft of petroleum products) were not proved. The respondent failed the fairness test and did not follow Section 41 of the Employment Act. Minutes of the disciplinary meeting were not availed and it was unclear whether the Claimant was represented. A related consolidated case against the same employer on the same cause of action found dismissal unfair, and the court adopted the same reasoning.

p. 4
02

Reinstatement

Holding

Refused - statute-barred and impracticable

Reasoning

Section 12(3)(vii) of the ELRC Act permits reinstatement only within three years of dismissal; the 2016 dismissal was seven years old. Reinstatement was also impractical because theft allegations created mistrust severing the employment relationship. The court adopted the principles in Kenya Airways v Aviation & Allied Workers Union on the discretionary nature of reinstatement.

p. 5
03

Salary in lieu of notice

Holding

One month's salary of Kshs 84,853.75 awarded

Reasoning

The Respondent acknowledged termination without notice. Under Sections 35 and 36 of the Employment Act, an employee terminated without the statutory notice is entitled to one month's salary in lieu; three months' notice was neither in the contract nor the recognition agreement.

p. 6
04

Service pay

Holding

Refused

Reasoning

Section 35(5) and (6) of the Employment Act disentitles an employee who is a member of a registered pension or provident fund scheme from service pay. The Claimant was a member of the Respondent's retirement benefits scheme and should pursue those dues from the fund.

p. 6
05

Compensation for unfair dismissal

Holding

Twelve months' gross salary awarded under Section 49 of the Employment Act

Reasoning

Having found the dismissal unfair, the court exercised its discretion under Section 49 to award the maximum of twelve months' gross salary as compensation, computed as Kshs 84,853.75 x 12 = Kshs 1,018,254/-.

p. 6

Legal principles established

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  • Procedural fairness in dismissal requires that the employee be informed of the charges, given an opportunity to prepare and be heard, and that representations be considered before dismissal
  • Reinstatement is discretionary, not an automatic right, and is subject to the three-year limit in Section 12(3)(vii) of the Industrial Court Act
  • An employee entitled to notice under Section 35 who is terminated without notice gets one month's salary in lieu of notice under Section 36

Court orders

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  1. 1.Judgment entered in favour of the Claimant on the finding of unfair and unlawful dismissal
  2. 2.Reinstatement denied as statute-barred and impracticable
  3. 3.One month's salary in lieu of notice of Kshs 84,853.75
  4. 4.Twelve months' salary as compensation for unfair dismissal of Kshs 1,018,254/-
  5. 5.Total award of Kshs 1,103,107/75 with interest at court rates from the date of judgment until full payment
  6. 6.Certificate of service to be provided within 30 days
  7. 7.Costs of the claim to the Claimant
Jurisdiction invoked
Employment and Labour Relations Court Act, 2011, Section 12

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, "Omanya v Kenya Pipeline Company Limited (Employment and Labour Relations Cause 70 of 2017) [2023] KEELRC 3323 (KLR)", Case Analysis (2023). Not stated in judgment as extracted. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/3323/eng@2023-12-21

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