Kenya Petroleum Oil Workers Union v Petro Oil Kenya Limited [2014] KEELRC 1005 (KLR)
The bottom line
#A Kenyan court ruled that an internal audit cannot replace the fair hearing employers must give employees before dismissing them for misconduct.
What this practically means
#Executive summary
#Key legal issues
#Procedural fairness under section 41 of the Employment Act
The dismissal was procedurally unfair as the Respondent did not inform the Grievant of the charges or hear his representations before dismissal
The Court applied section 41 and its own prior articulation of procedural fairness in Chitavi: the employer must inform the employee of contemplated charges, give an opportunity to prepare and be heard, and consider representations before dismissal. The Grievant's 7 June 2011 letter could not satisfy this since what prompted it was unclear, the spot audit could not substitute a hearing, and the Mombasa meeting occurred after the dismissal.
Characterisation of the claim - redundancy versus unfair termination
The Court treated the claim as one for unfair termination/wrongful dismissal despite it being pleaded as redundancy, because the Respondent admitted summarily dismissing the Grievant for misconduct
Though the Union pleaded redundancy, the dismissal letter was clear and the Respondent in its Response admitted summary dismissal for misconduct, and the issue was taken up in testimony and submissions. The Court therefore examined substantive and procedural fairness under sections 41, 43, 45 and 47(5).
Whether the Respondent proved valid and fair reasons for dismissal
It was unnecessary to determine this given the finding of procedural unfairness under section 45(2)(c)
Having found the dismissal procedurally unfair, the Court invoked section 45(2)(c) and declined to consider whether the Respondent proved valid and fair reasons, despite material placed before it on alleged fraud in March 2011 and the alleged loss of Kshs 28,000/-.
Remedies for unfair termination
The Grievant was awarded one month's notice pay, June 2011 salary, outstanding leave days and five months' gross pay as compensation, plus costs and a certificate of service
Sections 35 and 36 entitled the Grievant to notice pay; sections 10(7) and 20 shifted the burden to the employer on unpaid wages; section 10(7) supported the leave claim; section 51 entitled him to a certificate of service. On the discretionary twelve-month compensation under section 49(4), the Court considered his roughly two months' service as Manager and six years as an ordinary employee and awarded five months' gross pay.
Legal principles established
#- The burden of demonstrating procedural fairness in a dismissal for misconduct rests on the employer
- An audit or investigation into alleged misconduct cannot substitute the hearing that section 41 of the Employment Act obligates an employer to conduct
- An employer must inform an employee in clear and unambiguous language of the charges against him and that disciplinary action is contemplated, and seek his response
- The employer bears the burden of proving payment of wages under sections 10(3), (7) and 20 of the Employment Act
Court orders
#- 1.Respondent to pay one month pay in lieu of notice (Kshs 17,499/-)
- 2.Respondent to pay salary for June 2011 (Kshs 7,931/-)
- 3.Respondent to pay outstanding leave days (Kshs 87,495/-)
- 4.Respondent to pay five months' compensation for unfair termination (Kshs 20,000/- included in costs line; total award Kshs 149,524/-)
- 5.Respondent to pay costs assessed at Kshs 20,000/-
- 6.Respondent to issue a Certificate of Service to the Grievant
- 7.Claim for salary arrears for May and June 2011 dismissed
- Jurisdiction invoked
- Employment Act, 2007 (sections 35, 36, 41, 43, 45, 47(5), 49(4), 51, 10 and 20)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Petroleum Oil Workers Union v Petro Oil Kenya Limited [2014] KEELRC 1005 (KLR)", Case Analysis (2014). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/1005/eng@2014-05-23
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.