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Court of AppealPartially AllowedCivil Appeal No. 189 of 2013· [2019] KECA 698 (KLR)

British American Tobacco (K) Ltd v Kenyan Union of Commercial Food and Allied Workers (Kucfaw) [2019] KECA 698 (KLR)

Court of Appeal
7 June 2019
3,486 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~14 min to read original · ~4 min brief

The bottom line

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Kenya's Court of Appeal confirmed that employers only need reasonable grounds, proven on a balance of probabilities, to lawfully dismiss an employee.

What this practically means

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Executive summary

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This first appeal arose from the Industrial Court's award to a Stores Supervisor of British American Tobacco (K) Ltd, dismissed in April 2006 after an internal audit revealed losses through altered delivery notes and payments for goods never delivered. The trial judge held the disciplinary procedure proper but the dismissal unjustified, awarding notice pay, salary arrears, compensation and leave pay. The Court of Appeal, comprising Ouko (P), Musinga and Gatembu Kairu JJ.A, held that the applicable substantive law was the repealed Employment Act, Cap 226, since the cause of action arose in 2006, and that the respondent union bore the burden of proving the dismissal was unlawful. Re-evaluating the evidence as required on a first appeal, the court found the grievant's own written admissions, coupled with the audit findings and his role as sole custodian of the delivery stamp, furnished reasonable grounds for dismissal. It reaffirmed that disciplinary proceedings are civil, decided on a balance of probabilities rather than beyond reasonable doubt, so the absence of a conclusive audit report did not render the dismissal unfair. The court set aside the awards of three months' salary in lieu of notice and three months' salary for wrongful dismissal, but upheld salary arrears of Kshs.40,194.75 and leave pay of Kshs.108,763.40, with interest from 20th December 2012. Each party was ordered to bear its own costs. The appeal was allowed to that extent only.

Key legal issues

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01

Justification of the grievant's dismissal

Holding

The dismissal was justified; the grievant's own admissions and the audit supported reasonable grounds for dismissal.

Reasoning

The grievant admitted in a statement dated 15th March 2006 that items had been added to delivery notes and that he personally raised Goods Received Notes in respect thereof, causing the appellant to pay for goods never supplied. As Stores Supervisor and sole custodian of the delivery stamp, he bore overall responsibility. The court found no evidence of duress in recording his statements, and held the employer had reasonable grounds on a balance of probabilities.

p. 4
02

Standard of proof in disciplinary proceedings

Holding

Disciplinary proceedings are not criminal; the standard is the balance of probabilities.

Reasoning

Relying on its earlier decision in Judicial Service Commission v Gladys Boss Shollei & Another, the court reaffirmed that disciplinary proceedings between employer and employee are civil in nature, and the employer need only believe on reasonable grounds, supported by as much investigation as is reasonable, that the employee is guilty. An audit report was not required as conclusive proof since this was not a criminal trial.

p. 4
03

Role of a first appellate court

Holding

The Court of Appeal on a first appeal must re-evaluate the evidence and reach its own conclusions while making allowance for the trial court's advantage of seeing witnesses.

Reasoning

Citing Kenya Engineering Workers Union v Narcol Aluminium Rolling Mills Ltd, the court restated its duty on a first appeal from the Labour and Employment Court: to evaluate and reconsider the evidence and come to its own independent conclusion, bearing in mind it did not see and hear the witnesses. This framed its re-examination of the justification for dismissal.

p. 4
04

Entitlement to salary arrears and leave pay

Holding

The grievant retained entitlement to salary arrears for March and April 2006 and leave pay, despite the dismissal being upheld.

Reasoning

Having upheld the dismissal, the court set aside the awards of notice pay and compensation for wrongful dismissal but affirmed the trial court's award of salary arrears of Kshs.40,194.75 and leave pay of Kshs.108,763.40, totalling Kshs.148,958.15, with interest from the date of the trial judgment.

p. 4

Legal principles established

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  • In disciplinary proceedings between an employer and an employee, the standard of proof is on a balance of probabilities, not beyond reasonable doubt; where an employer conducts appropriate investigations and has reasonable grounds for terminating employment, and follows the statutory procedure, the dismissal is not unlawful.

Court orders

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  1. 1.The award of 3 months' salary in lieu of notice is set aside
  2. 2.The award of 3 months' salary for wrongful dismissal is set aside
  3. 3.The grievant is entitled to salary arrears for March and April 2006 in the sum of Kshs.40,194.75 and leave pay for 32.5 days at Kshs.108,763.40, amounting to Kshs.148,958.15
  4. 4.Interest on Kshs.148,958.15 from 20th December 2012 until payment in full
  5. 5.Each party bears its own costs

Authorities

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Legislation

  • Employment Act, Cap 226 (repealed)Section 17
  • Employment Act, 2007Sections 45(2) and 46
  • Collective Bargaining Agreement (between the appellant and the respondent)Section 39(a)/Clause 39(a)2

Cases cited (7)

  • ANTHONY MULAKI v ADDAX KENYA LIMITED
    Cause No. 822 of 2012
  • BRITISH HOME STORES LTD v BURCHELL
    (1980) I.C.R. 303
  • JUDICIAL SERVICE COMMISSION v GLADYS BOSS SHOLLEI & ANOTHER
    [2014] eKLR
  • CFC STANBIC LIMITED v DANSON MWASHAKO MWAKUWONA
    [2015] eKLR
  • GRACE GACHERI MURITHI v KENYA LITERATURE BUREAU
    [2012] eKLR
  • MARY CHEMWENO KIPTUI v KENYA PIPELINE COMPANY LIMITED
    [2014] eKLR
  • KENYA ENGINEERING WORKERS UNION v NARCOL ALUMINIUM ROLLING MILLS LTD
    [2016] eKLR
On appeal from
Industrial Court of Kenya
Industrial Cause No. 538 of 2009
Jurisdiction invoked
First appeal to the Court of Appeal from the Industrial Court of Kenya

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (10)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "British American Tobacco (K) Ltd v Kenyan Union of Commercial Food and Allied Workers (Kucfaw) [2019] KECA 698 (KLR)", Case Analysis (2019). Civil Appeal No. 189 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2019/698/eng@2019-06-07

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