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ELRCPartially AllowedNot stated in the judgment (memorandum of claim dated 19.07.2019)

Hiribae v Kenya Pipeline Company Limited (Cause 476 of 2019) [2024] KEELRC 2045 (KLR)

Employment and Labour Relations Court
26 July 2024
1,963 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~8 min to read original · ~4 min brief

The bottom line

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Kenya Pipeline's unfair dismissal of a technician over unproven theft allegations earned the employee six months' pay.

What this practically means

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Executive summary

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The claimant, employed by the respondent as Technician III (Operations) on 3rd November 2006, was suspended on 2nd March 2016 over allegations of involvement in a petroleum products theft syndicate, issued a show cause letter, heard by a Staff Disciplinary Committee, and summarily dismissed by letter dated 22nd July 2016 on grounds of negligence amounting to gross misconduct. His appeal to the Managing Director under the HR Manual was never determined. He sought reinstatement, an injunction against eviction from staff housing, unpaid salary, or alternatively 12 months' pay as damages for unfair termination, plus costs. The respondent denied unfairness, asserting the dismissal followed laid-down disciplinary procedures. The Court found the parties were in a contract of service terminated by the summary dismissal letter. It held the termination unfair both in substance and procedure: the alleged theft was never quantified or linked to the claimant, whose role was merely to pump product at high pressure per instructions; security was not his role; the disciplinary panel was improperly constituted under the staff rules, a failure that went to the panel's jurisdiction and rendered the proceedings incurably defective; and the agreed administrative appeal was never heard. Reinstatement was refused as time-barred under section 12 of the ELRC Act, 2011, and the injunction fell with it. Applying section 49 of the Employment Act and considering ten years of service and payments already made, the Court awarded 6 months' gross salary (Kshs.630,000 less PAYE), payable by 01.09.2024 failing interest at court rates, with costs of the suit to the claimant. Judgment delivered at Nairobi on 26th July 2024 by Byram Ongaya, Principal Judge.

Questions the Court framed

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

  1. 1.Whether the parties were in a contract of service
  2. 2.Whether and how the contract of service was terminated
  3. 3.Whether the termination was fair (in substance and procedure)
  4. 4.What remedies, if any, the claimant is entitled to

Key legal issues

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01

Validity of the reason for termination

Holding

The reason (negligence enabling theft of products) was not genuine or established

Reasoning

The claimant's unrebutted testimony was that his role was to pump product through underground pipes at high pressure per instructions and he could not interfere with it. The quantity stolen was never quantified or linked to him by documents. Culpability was never established at the disciplinary hearing, so the respondent failed to justify the reason under sections 43 and 47(5) of the Employment Act.

p. 3
02

Fairness of the reason under section 45

Holding

The termination was based on an unfair or unjustified reason

Reasoning

The alleged negligence-related duty and its breach were never established. It was not shown how the claimant was involved if unauthorised trucks accessed the product, and security was not his role. The reason therefore did not relate to his conduct, compatibility, or the respondent's operational requirements as required by section 45 of the Employment Act.

p. 4
03

Fairness of procedure

Holding

Procedure was unfair: the disciplinary panel was improperly constituted and the administrative appeal was never determined

Reasoning

The staff rules required the disciplinary panel to include the Head of HRD, the Section Head of the concerned officer and one other Section Head; the claimant's evidence that this was not complied with was unrebutted. The non-compliance went to the panel's jurisdiction, rendering the proceedings incurably defective. The respondent also failed to consider and determine the claimant's administrative appeal as agreed.

p. 4
04

Remedies for unfair termination

Holding

Reinstatement and the linked injunction refused as time-barred/overtaken; 6 months' gross salary awarded as compensation under section 49

Reasoning

Reinstatement is time-barred under section 12 of the ELRC Act, 2011, and the injunction depended on reinstatement. Applying section 49 factors and considering around ten years of service and the payments already made (especially one month's notice pay), the Court balanced justice by awarding 6 months' gross salary (6 x Kshs.105,000 = Kshs.630,000), less PAYE.

p. 4

Legal principles established

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  • An employer must establish a valid and genuine reason for termination under sections 43 and 47(5) of the Employment Act; unsubstantiated allegations of theft do not suffice
  • Non-compliance with staff rules on the composition of a disciplinary panel goes to the jurisdiction of the panel and renders the proceedings incurably defective
  • Failure to hear and determine an agreed administrative appeal means the employer has not adopted a fair procedure before summary dismissal

Court orders

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  1. 1.Payment of Kshs. 630,000.00 (less PAYE) by 01.09.2024, failing which interest at Court rates from the date of judgment until full payment
  2. 2.Respondent to pay costs of the suit

The bench

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

majority

Wrote the judgment

Jurisdiction invoked
Employment and Labour Relations Court Act, 2011, section 12; Employment Act, 2007 (sections 43, 44, 45, 47(5), 49)

Relief refused

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Reinstatement to employment on the same terms as before 2nd March 2016

Statutory limitation of three years under section 12 of the Employment and Labour Relations Court Act, 2011 had lapsed

p. 4

Injunction prohibiting the respondent from evicting the claimant from House Number 47, Kenya Pipeline Estate, Outering Road

It was anchored on reinstatement, which was no longer available as the contract of service had been terminated

p. 4

Outstanding and unpaid salary for days worked from 2nd March 2016 to date

Not granted; the dismissal letter provided for payments up to 22.07.2016, which the Court treated as a mitigating factor

p. 4

Costs

Considering the margins of success, the respondent to pay costs of the suit

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.

Thus, the termination was unfair both in procedure and in substance.
p. 4Unfair termination - overall finding
An improperly constituted disciplinary panel rendered the proceedings incurably defective.
p. 4Disciplinary procedure - panel composition
In conclusion, judgment is hereby entered for the claimant against the respondent for: 1. Payment of Kshs. 630, 000.00 (less PAYE) by 01.09.2024 failing interest to be payable thereon at Court rates from the date of this judgment until full payment. 2. Payment of costs of the suit.
p. 4Final orders / disposition

Issues in the judgment

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minor

The suit number/case number is not stated anywhere in the judgment text supplied

minor

The judgment refers to the dismissal letter citing nights of 26th/27th June 2015 and 5th/6th November 2015, whereas the claimant's pleadings and show cause response refer to duty on 6th-7th July 2015 and 7th-8th November 2015 - a discrepancy in the dates of the alleged incidents

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, "Hiribae v Kenya Pipeline Company Limited (Cause 476 of 2019) [2024] KEELRC 2045 (KLR)", Case Analysis (2024). Not stated in the judgment (memorandum of claim dated 19.07.2019). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2045/eng@2024-07-26

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