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ELRCPartially AllowedCause No 986 of 2013· [2014] KEELRC 1505 (KLR)

Elkana Sweta Makokha v Bob Morgan Services Limited [2014] KEELRC 1505 (KLR)

Industrial Court of Kenya
18 November 2014
5,927 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Even when an employee's firing is justified, Kenyan employers must still follow fair hearing procedures or the dismissal becomes unfair.

What this practically means

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Executive summary

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The claimant, employed by the respondent security firm from 1992 and rising to Operations Director and company director, was summarily dismissed in May 2013 for gross misconduct after two firearm incidents - an arrest in Meru and the surrender of his firearm at Embakasi Police Station - which he failed to report to the Managing Director, culminating in revocation of the respondent's firearms permits and business losses. He claimed unfair termination and terminal dues of about Kshs.19.5 million, including remedies purportedly under section 185 of the Companies Act. The court framed three issues: justifiability of the dismissal, conflicting versions of the employment contract, and remedies. It held the respondent proved valid reasons under section 43 of the Employment Act, but the dismissal was procedurally flawed because the claimant's section 41(1) right to a companion of his choice was not honoured and no record of the hearing or appeal notification existed. The claimant was also found to have tampered with his contract copy to inflate the notice period, so the respondent's version (one month's notice) was adopted; his credibility was impugned. The section 185 Companies Act claim was treated as abandoned. The claim was partially allowed: compensation of one month's salary (Kshs.414,993), one month's notice pay (Kshs.414,993), and nine days' pay (Kshs.194,103.33), subject to deductions for amounts already received. Service pay, allowances and leave pay were declined; Sacco dues could be offset. Each party was ordered to bear its own costs.

Key legal issues

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01

Justifiability of the reason for dismissal

Holding

The Respondent proved valid reasons under section 43: the Claimant's mishandling of firearms and failure to report incidents to the MD were gross dereliction of duty

Reasoning

Section 43(1) places on the employer the burden of proving the reasons for termination. The court found the two firearm incidents - arrest in Meru and surrender at Embakasi - grave operational matters which any employee, however senior, should have reported. It was immaterial that the matters were resolved and no charge ensued; the firearm leaving the Claimant's custody justified disciplinary action.

p. 7
02

Procedural fairness under section 41

Holding

The dismissal was procedurally flawed because the Claimant was denied his section 41(1) right to have a companion of his choice and no evidence of the hearing proceedings or right of appeal existed

Reasoning

The Claimant brought his wife and house help as witnesses; these are not persons contemplated by section 41(1). The employer had a duty to explain this and offer him the option of choosing a fellow employee, which it did not do. The colleagues present were not of the Claimant's choice, and the absence of hearing minutes and an appeal notification compounded the unfairness.

p. 7
03

Authenticity of the employment contract

Holding

The Claimant tampered with his copy of the contract to inflate the notice period; the Respondent's copy was adopted as the true contract

Reasoning

The Claimant admitted inserting a page to read three months' notice instead of one month. The court found this manipulation spoke to his character and trustworthiness as a witness and preferred the Respondent's original document as the true record of the agreement between the parties.

p. 8
04

Remedies under section 49

Holding

Compensation assessed at one month's gross salary of Kshs.414,993, plus one month's notice pay and confirmation of the 9 days' pay already computed

Reasoning

Given the procedural flaw but valid reasons for dismissal, a modest award of one month's salary as compensation was appropriate under section 49(1)(c). Notice pay was awarded because the Respondent admitted willingness to pay one month in lieu. Days worked were payable and the Respondent's higher computation was confirmed.

p. 8

Legal principles established

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  • Even in serious cases falling under section 44 of the Employment Act, an employee is entitled to a hearing conducted per section 41
  • The employee's right under section 41(1) to a companion of his choice cannot be compromised by the employer substituting its own choice
  • Failure to follow section 41, which is mandatory, renders the employer's decision unfair
  • An employee who joins a Sacco by authorising deductions is estopped from claiming full savings on termination without accounting for Sacco dues
  • Seniority does not exempt an employee from due process in disciplinary proceedings

Court orders

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  1. 1.A declaration that there was a procedural flaw in the summary dismissal of the claimant
  2. 2.Compensation equivalent to one month's salary at Kshs.414,993.00
  3. 3.Notice pay at Kshs.414,993.00
  4. 4.Nine days worked amounting to Kshs.194,103.33
  5. 5.The amounts to be paid less what the Claimant has received and/or been deposited into his bank account
  6. 6.Each party to bear their own costs

Authorities

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Legislation

  • Employment Actsection 41(1),(2)
  • Employment Actsection 42(1)
  • Employment Actsection 43(1),(2)
  • Employment Actsection 44(3),(4),(c),(g)
  • Employment Actsection 35(5)
  • Employment Actsection 47(5)
  • Employment Actsection 49(1)(c)
  • Employment Actsection 10
  • Companies Actsection 185

Cases cited (3)

  • Johnson Jadhan Othieno Okumu versus Pwani Oil Products Limited
    [2013] eKLR
  • Jackson Butiya versus EPK
    Cause No.335 of 2011
  • Javan Mbago Were versus H. YOUNG & CO. (EA) LTD
    Cause No. 1478 of 2010
Jurisdiction invoked
Jurisdiction as the Industrial Court of Kenya under the Industrial Court Act over employment and labour relations disputes

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, "Elkana Sweta Makokha v Bob Morgan Services Limited [2014] KEELRC 1505 (KLR)", Case Analysis (2014). Cause No 986 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/1505/eng@2014-11-18

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