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ELRCPartially Allowed· [2012] KEELRC 135 (KLR)

GRACE GACHERI MURIITHI V KENYA LITERATURE BUREAU [2012] KEELRC 135 (KLR)

Industrial Court of Kenya
12 October 2012
BOByram Ongaya
8,877 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court reinstated an unfairly dismissed accountant and awarded her over Ksh.1.5 million, ruling the wrong manager had no power to fire her.

What this practically means

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Executive summary

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The claimant, an accountant with Kenya Literature Bureau, was suspended without pay following a burglary at the cash office in May 2010 in which Ksh.604,151 was lost, then dismissed by the Managing Director with effect from 18 May 2010 after disciplinary proceedings before a Staff Advisory and Disciplinary Committee. The court first confirmed its jurisdiction under Article 162(2)(a) of the Constitution and sections 12(1) and (2) of the Industrial Court Act, 2011, rejecting the respondent's plea that its status as a state corporation ousted jurisdiction. On the merits, the court held that dismissal powers over employees in KLB scale 9 and above vested exclusively in the Board under paragraph 6.2.2 of the Terms and Conditions of Service; the Managing Director usurped that power, rendering the termination a nullity. Proceedings allegedly held on 22 October 2010 were convened by an authority not properly seized of the case. On validity of reasons, the court found the claimant's replies satisfactory and unrebutted, and held that the alleged misconduct stemmed from the respondent's own deficient operational policies - inadequate petty cash float, absent safe-key custody instructions, a shared alarm system and managerial quality-assurance failures - making the termination unfair under section 45 of the Employment Act and contrary to Article 41(1) on fair labour practices. Paragraphs 6.2.4 and 6.3.2 of the Terms and Conditions were declared unconstitutional to the extent indicated. The court declared the termination unfair, ordered reinstatement effective 15 October 2012, awarded Ksh.1,522,565 for suspension-period salary and 12 months' compensation, interest and costs. The maternity leave claim failed as the court had already awarded full pay for that period.

Key legal issues

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01

Jurisdiction of the Industrial Court over a state corporation employer

Holding

The court has jurisdiction; the respondent's status as a state corporation does not oust it

Reasoning

Article 162(2)(a) required Parliament to establish a court with the status of the High Court for employment disputes, realised in the Industrial Court Act, 2011. Section 12(1) confers exclusive original and appellate jurisdiction over employment disputes, and section 12(2) allows claims by or against an employer, including public bodies. Article 165(5)(b) ousts the High Court from such matters.

p. 9
02

Competent authority to dismiss employees in KLB scale 9 and above

Holding

The power to dismiss, demote or reduce in rank of employees in KLB scale 9 and above vested in the Board under paragraph 6.2.2; the Managing Director's termination was a nullity

Reasoning

Paragraph 1.3 conferred only a general enforcement power which could not override the express paragraph 6.2.2 vesting dismissal powers in the Board. The Managing Director could suspend and investigate but only table the case for the Board's decision. The case was never tabled before the Board; the Managing Director usurped the Board's powers, and proceedings before a committee not properly seized were invalid.

p. 11
03

Whether the termination was unjust and unfair under section 45 of the Employment Act, 2007

Holding

The termination was unfair; the reasons were invalid and the replies of the claimant were satisfactory

Reasoning

The claimant gave elaborate explanations to every allegation, and the respondent produced no investigation report or evidence to demolish them. The alleged misconduct stemmed from the respondent's own deficient operational policies: inadequate petty cash float, no safe-custody instructions for the safe key, a shared alarm system, and managerial failure in quality assurance over the erroneous cheque. Punishing an employee for losses attributable to unresolved grievances violates Article 41(1).

p. 12
04

Constitutionality of paragraphs 6.2.4 and 6.3.2 of the KLB Terms and Conditions of Service

Holding

Both provisions were declared unconstitutional to the extent they offended Articles 41(1), 10, 35 and 232

Reasoning

Paragraph 6.3.2 restricted access to documentary evidence relied on in disciplinary proceedings, offending transparency and access-to-information guarantees applicable to a public body. Paragraph 6.2.4 denied salary during suspension even where the employee exculpated herself, which is an unfair labour practice contrary to Article 41(1).

p. 14
05

Remedies: suspension-period salary, 12 months' compensation and reinstatement

Holding

Claimant awarded salary for June to December 2010 (Ksh.560,945), 12 months' compensation (Ksh.961,620) and reinstatement

Reasoning

Having found the termination unfair, the claimant was entitled to full pay through the suspension period. Compensation of 12 months' gross salary was awarded for gross violation of section 41 of the Employment Act and Article 41 of the Constitution. Under section 49(4), reinstatement was appropriate: she was a confirmed public officer protected by Article 236, willing to return, with no practical impediment.

p. 15

Legal principles established

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  • An employer cannot rely on a general power to override an express provision vesting disciplinary dismissal powers in a specific organ; action taken without such power is a nullity
  • It is an unfair labour practice for an employer to fail to act on reported deficiencies in its operational policies and systems, or to visit adverse consequences on an employee for losses attributable to such deficiencies
  • Entitlement to pay during suspension depends on the outcome of the disciplinary proceedings
  • Where an employer fails to prove a valid reason and fair procedure, termination is unfair under section 45 of the Employment Act

Court orders

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  1. 1.A declaration that the termination of employment by the respondent was unfair
  2. 2.The respondent to return the claimant to work with effect from 15th October, 2012 in the same position and current benefits, terms and conditions applicable to the position, to be deployed by the respondent's Managing Director accordingly
  3. 3.The respondent to pay the claimant Ksh.1,522,565.00 comprising payments for June to 30th December 2010 and 12 months' compensation for unfair dismissal
  4. 4.The respondent to pay interest at court rates on the award from 1st January 2011 till full payment
  5. 5.The respondent to pay costs of the cause

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 162(2)(a)
  • Constitution of Kenya, 2010Article 165(3), 165(3)(c), 165(5)(b)
  • Constitution of Kenya, 2010Article 41(1)
  • Constitution of Kenya, 2010Article 10
  • Constitution of Kenya, 2010Article 35
  • Constitution of Kenya, 2010Article 232(12)(e) and (f)
  • Constitution of Kenya, 2010Article 236
  • Constitution of Kenya, 2010Article 144, Article 191
  • Industrial Court Act, 2011Long title; sections 12(1), 12(2)
  • Employment Act, 2007sections 41, 45, 49(4)
  • Kenya Literature Bureau ActNot specified
Jurisdiction invoked
Article 162(2)(a) of the Constitution of Kenya, 2010 and sections 12(1) and 12(2) of the Industrial Court Act, 2011

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (25)

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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, "GRACE GACHERI MURIITHI V KENYA LITERATURE BUREAU [2012] KEELRC 135 (KLR)", Case Analysis (2012). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2012/135/eng@2012-10-12

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