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ELRCDismissedNot stated in the judgment extract (Employment and Labour Relations Court cause)

Okwaro v Kituo Cha Sheria t/a Legal Adivice Centre (Cause E560 of 2020) [2024] KEELRC 1796 (KLR)

Employment and Labour Relations Court
5 July 2024
7,959 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~32 min to read original · ~4 min brief

The bottom line

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What this practically means

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Executive summary

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The Claimant, employed from 26th March 2018 as Finance, Administration and Human Resource Coordinator at Kshs 137,000 per month, sued the Respondent alleging unfair, unlawful and unprocedural summary dismissal in September 2019. She complained of a defamatory anonymous email, a physical assault by the Executive Director's personal assistant, a skewed audit, suspension in April 2019, a disciplinary hearing before a newly constituted interim board allegedly unregistered with the NGO Co-ordination Board, non-payment of July and August 2019 salaries, and discrimination. She sought a declaration that the termination was unlawful, Kshs 5,059,500 in particularized dues and compensation, general damages, interest and costs. The Respondent defended the dismissal as substantively and procedurally fair, founded on misappropriation of funds, insubordination and absenteeism, and counterclaimed for Kshs 255,260 in lost funds. The court framed two issues: whether the dismissal was unfair and unlawful, and entitlement to reliefs. Relying on the requirement of both substantive and procedural fairness, the court found the Respondent proved valid reasons through the audit evidence and that the Claimant was accorded a fair process under section 41 of the Employment Act, including a show cause letter, responses, a hearing with the right to be accompanied, and opportunity to tender further documents. The discrimination claim failed for lack of particularization. The claim was dismissed in its entirety with costs on 5th July 2024. Notably, the counterclaim was not expressly disposed of in the final orders.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the Claimant's dismissal from employment was unfair and unlawful
  2. 2.Whether the parties are entitled to the reliefs sought

Key legal issues

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01

Whether the termination was substantively fair (valid reasons)

Holding

Yes - misappropriation of funds, absenteeism and insubordination were established; the audit showed project funds diverted to petty cash and the Claimant, as head of finance, was ultimately liable

Reasoning

The Respondent relied on a 2018 warning letter, a suspension letter, a notice to show cause and an audit report by RW2. RW2 testified that project funds were used as petty cash contrary to donor restrictions. The Claimant's responses were unsatisfactory and she conceded the audit issues were raised and responded to. The court was satisfied the Respondent believed valid reasons existed at termination.

p. 15
02

Whether the termination was procedurally fair under section 41 of the Employment Act

Holding

Yes - the Claimant was issued a show cause letter, responded, was invited to a disciplinary hearing with the right to be accompanied, was heard, and was permitted to submit further documents

Reasoning

The Claimant conceded being invited to the hearing, informed of the right to attend with a colleague, given the investigation report and allowed to respond. The delay in the hearing and the change of board did not render the process unfair; the new board had the relevant records. The court was satisfied the process complied with section 41.

p. 15
03

Whether the Claimant was discriminated against

Holding

No - the Claimant did not specifically demonstrate how she was discriminated against; differential treatment was justified by her ultimate responsibility for finances

Reasoning

The Claimant alleged she was singled out after a defamatory email and a physical attack by the Executive Director's PA. The court found the disciplinary hearing concerned performance issues, not her complaints, and that the Respondent did act on the complaints by disciplining the PA and having staff respond. She also failed to use the grievance procedure in policy 30 of the manual.

p. 15

Legal principles established

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  • For a termination to be fair there must be both substantive and procedural fairness
  • The employer bears the duty to prove and justify the reasons for termination under section 47(5) of the Employment Act, and the reasons must be fair and valid under section 43
  • A head of finance is ultimately liable for losses of funds under her charge

Court orders

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  1. 1.The claim for unfair termination and the claim in its entirety is dismissed
  2. 2.Claim dismissed with costs

The bench

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One judgment of the whole court — no separate or dissenting opinions.

Wrote the judgment

Jurisdiction invoked
First-instance claim under the Employment Act in the Employment and Labour Relations Court (specific enabling provision not stated in the judgment)

Relief refused

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Declaration that the Claimant's termination was unlawful, unprocedural and unjustified

Court found the Respondent had fair and valid reasons and followed a fair procedure

p. 15

Monetary reliefs of Kshs 5,059,500 (salary arrears, notice pay, welfare deductions, 12 months' compensation, discrimination damages)

Entire claim found without merit and dismissed

p. 15

General damages for emotional distress

Falls with the dismissed claim

p. 15

Costs

The claim is dismissed with costs (costs to the Respondent).

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

It is an established requirement that for a termination to pass fairness test there must be both substantive and procedural fairness.
p. 15Substantive and procedural fairness in termination
the Respondent had fair and valid reasons to terminate the Claimant service and considering the process followed in executing the termination outlined earlier in the judgment, the Court is satisfied that the respondent did so through a fair procedure and in accordance with section 41 of Employment Act.
p. 15Finding on validity of termination
The claim for unfair termination and indeed the claim in its entirety is found without merit and is hereby dismissed with costs.
p. 15Final orders - dismissal of claim
she did not dispute that as the head of Finance, she was the one liable ultimately in case of any loss of any money belonging to the Respondent under her charge.
p. 15Responsibility of head of finance for losses

Issues in the judgment

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material

The Respondent's counterclaim (reimbursement of Kshs 255,260 with interest and general damages) is neither determined nor expressly disposed of in the court's final orders, which only dismiss the Claimant's claim

minor

Internal date inconsistencies in the pleadings/evidence: reference to a letter 'dated 21st March 209' and hearing 'to take place on 29th April, 2018' where 2019 is plainly meant

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, "Okwaro v Kituo Cha Sheria t/a Legal Adivice Centre (Cause E560 of 2020) [2024] KEELRC 1796 (KLR)", Case Analysis (2024). Not stated in the judgment extract (Employment and Labour Relations Court cause). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1796/eng@2024-07-05

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