Kenya Commercial Bank Limited v Thomas Nyangi Mwita [2019] KECA 337 (KLR)
The bottom line
#Kenya's Court of Appeal confirmed KCB could fire a branch manager for misconduct but slashed his payout because the bank skipped the mandatory hearing process.
What this practically means
#Executive summary
#Key legal issues
#Whether the dismissal was procedurally fair
The employer breached the respondent's fair hearing rights because the respondent was not confronted with the forensic report or asked to attend a meeting to respond to the allegations before dismissal.
Although the respondent was given a show-cause letter and responded, there was no meeting to hear his representations, and it was unclear whether the forensic report was availed to him before it was finalised. Section 41(2) of the Employment Act requires in mandatory terms that representations be heard and considered before termination. To that extent the procedural requirements were breached.
Whether the substantive decision to dismiss was justified
The appellant was entitled to dismiss the respondent because he breached his fiduciary duty through irregular conduct, including opening accounts contrary to prudential guidelines and receiving cash from a customer.
Evidence from bank employees and the forensic investigation established that the respondent, as Branch Manager, opened and authorised accounts and payments for customers with nil or debit balances contrary to the Central Bank of Kenya Prudential Guidelines, usurped the Legal Department's functions and received an inducement from a customer. A bank employee must maintain the highest standards of integrity; the dismissal was substantively justified.
Quantum of compensation for wrongful termination
The 12 months' maximum compensation award was set aside and replaced with 4 months' salary, because the only basis for the award was the employer's procedural breach.
The respondent's conduct bordered on criminal conduct and disentitled him from maximum compensation. Having found the dismissal procedurally flawed only, the court assessed 4 months' salary as adequate compensation, expressly tied to the employer's failure to follow the strict termination process.
Legal principles established
#- In a claim arising out of termination, the employer bears the duty to prove the reasons for termination, failing which the termination is unfair; and the burden of justifying the grounds for termination rests on the employer under section 47 of the Employment Act.
- Section 41(2) of the Employment Act mandatorily requires an employer, before termination or summary dismissal, to hear and consider any representations the employee may make on the grounds of misconduct or poor performance.
- A first appellate court must re-examine the record and re-evaluate the evidence and come to its own conclusion on the findings of the trial court.
- Compensation for wrongful termination cannot exceed 12 months' gross salary, and maximum compensation is not automatic; the conduct of the employee is relevant to the quantum.
Court orders
#- 1.Award of 3 years' loss of salary of Shs.9,597,708 set aside
- 2.Award of 12 months' salary compensation set aside and substituted with 4 months' salary as compensation for wrongful termination
- 3.3 months' salary in lieu of notice upheld
- 4.Each party to meet their own costs in the appeal and in the High Court
- On appeal from
- Employment and Labour Relations Court at Nairobi
- Cause No. 464 of 2012
- Jurisdiction invoked
- First appellate jurisdiction under the Court of Appeal rules (rule 29) over an appeal from the Employment and Labour Relations Court
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (1)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Akala v Kenya Commercial Bank Limited (Cause 1569 of 2018) [2025] KEELRC 1724 (KLR)[2025] KEELRC 1724 (KLR)12 Jun 2025
Cite this brief
#Cite this brief
Caselaw, "Kenya Commercial Bank Limited v Thomas Nyangi Mwita [2019] KECA 337 (KLR)", Case Analysis (2019). Civil Appeal No. 53 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2019/337/eng@2019-09-27
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.