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ELRCPartially AllowedCause No 126 of 2014· [2015] KEELRC 154 (KLR)

Patrick Abuya v Institute of Certified Public Accountants of Kenya (ICPAK) & another [2015] KEELRC 154 (KLR)

Employment and Labour Relations Court
4 December 2015
RSRadido Stephen
4,207 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~17 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled an accountant's dismissal unfair because his employer gave him only 30 minutes' notice of his disciplinary hearing, awarding him over Kshs 675,000.

What this practically means

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Executive summary

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The Claimant, employed as Assistant Manager, Procurement by the Institute of Certified Public Accountants of Kenya from September 2011, was issued a show cause notice on 12 February 2014, responded in writing, and was invited to an oral hearing before a Disciplinary Committee of the Respondent's Council on 4 March 2014 - served with the invitation on the morning of the hearing. He was dismissed the next day under section 44(4)(c) of the Employment Act and sued the Institute and its Acting Chief Executive Officer, quantifying his claim at over Kshs 60 million. The Court framed three issues: whether the 2nd Respondent was non-suited, whether the dismissal was unfair, and appropriate remedies. It held the pleadings disclosed a cause of action against the 2nd Respondent, though the claim against him ultimately failed on proof. On fairness, the employee's low threshold burden under section 47(5) was discharged since no termination notice was given. The Court found no statutory requirement of pre-hearing investigations (the audit sufficed), no irregularity in the Council composing the Disciplinary Committee, and no prejudice in the written phase, but held the Claimant was ambushed by being served the hearing invitation on the morning of the hearing, rendering the dismissal procedurally unfair under sections 41 and 45(4)(b). Lost earnings to retirement, service pay, 3 months' notice pay and harassment damages were refused. The Court awarded unpaid leave days, March 2014 wages, 1 month's pay in lieu of notice and 2 months' gross wages as compensation, totalling Kshs 675,993/70, with costs to the Claimant.

Key legal issues

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01

Whether the pleadings disclosed a cause of action against the 2nd Respondent

Holding

The pleadings disclosed a cause of action against the 2nd Respondent; non-suiting him was a red herring at the pleading stage, though the claim against him ultimately failed on proof

Reasoning

The Memorandum of Claim alleged that the 2nd Respondent acted irregularly, unlawfully harassed the Claimant and acted in bad faith, with particulars given. Setting out facts constituting a cause of action is distinct from proving those facts; failure of proof leads to dismissal of the claim, not to a finding that no cause of action was disclosed.

p. 2
02

Whether the dismissal was procedurally fair

Holding

The dismissal was procedurally unfair because the Claimant was ambushed - served with the oral hearing invitation on the morning of the hearing with barely 30 minutes to prepare, where the Respondents claimed he had absconded but took no positive steps to serve him

Reasoning

Although the Claimant received the show cause notice, responded in writing and attended an oral hearing, the service of the hearing invitation on the morning of the hearing, without any steps taken to locate him or suspend him, was ill motivated and breached the mandatory requirements of section 41 of the Employment Act and section 45(4)(b). Given this conclusion, the Court did not consider sections 43 and 45 burdens.

p. 6
03

Whether failure to carry out investigations prior to the disciplinary process rendered the dismissal unfair

Holding

No - investigations prior to a disciplinary process are not an express statutory requirement; the contractual clause required investigation only 'if appropriate', and the audit commissioned before the show cause notice sufficed

Reasoning

The claim was anchored on clause 9.0 of the Human Resource Policy Manual. The words 'if appropriate' made investigations dependent on the circumstances. An investigation is to gather facts to establish grounds for disciplinary action; it need not involve the employee nor take a quasi-judicial form, as comparative authorities confirm. An audit had been commissioned before the show cause notice.

p. 4
04

Whether the composition of the Disciplinary Committee (Council members) was irregular and deprived it of jurisdiction

Holding

The Council was properly constituted to conduct the disciplinary process given the absence of a substantive CEO and the involvement of management staff in their own disciplinary processes

Reasoning

The Claimant contended the Committee should have comprised the CEO and/or HR Manager with the Council sitting only on appeal. The explanation that there was no substantive Chief Executive Officer and that management staff who could have sat were themselves undergoing disciplinary processes was not challenged. The Council was therefore in order.

p. 5
05

What remedies flow from the finding of procedural unfairness

Holding

Lost earnings to retirement, terminal benefits/service pay, 3 months' notice pay, and harassment damages were refused; the Claimant was awarded unpaid leave, March 2014 wages, 1 month's pay in lieu of notice and 2 months' gross wages as compensation

Reasoning

Lost income to retirement is unattainable in law. Service pay fails as the Claimant contributed to NSSF. The contract provided 1 month's notice pay. Compensation under section 49(1)(c) is discretionary; considering length of service, 2 months' gross wages were awarded. Earned wages for March 2014 are due under section 49(1)(b), and leave days were computed using section 10(3) and (7) as the employer kept no records.

p. 7

Legal principles established

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  • An employee complaining of unfair termination bears a low threshold burden under section 47(5) of the Employment Act before the employer is called upon to justify the termination
  • Where no notice of termination is given, the evidentiary burden shifts to the employer to show a breach of a fundamental contractual obligation justifying summary dismissal
  • The essentials of procedural fairness under section 41 of the Employment Act require the employer to inform the employee of the charges, give a proper opportunity to prepare and be heard, and hear and consider representations before dismissal
  • Pre-disciplinary investigations are not an express statutory requirement; their nature depends on the circumstances and need not be quasi-judicial
  • Procedural fairness requires advance and reasonable notice of disciplinary steps and adequate time to prepare, given the threat of loss of livelihood

Court orders

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  1. 1.Unpaid leave days Kshs 159,215/50
  2. 2.Wages for March 2014 Kshs 27,514/20
  3. 3.1 month pay in lieu of notice Kshs 148,088
  4. 4.2 months gross wages as compensation Kshs 341,176
  5. 5.Total award of Kshs 675,993/70 to the Claimant
  6. 6.Claimant to have costs

Authorities

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Legislation

  • Employment Act, 2007section 44(4)(c)
  • Employment Act, 2007section 47(5)
  • Employment Act, 2007section 35(1)(c)
  • Employment Act, 2007section 35(5)
  • Employment Act, 2007section 41
  • Employment Act, 2007section 43
  • Employment Act, 2007section 45
  • Employment Act, 2007section 45(4)(b)
  • Employment Act, 2007section 49(1)(b)
  • Employment Act, 2007section 49(1)(c)
  • Employment Act, 2007section 10(3) and (7)
  • Accountants Actsection 38
  • Constitution of Kenya, 2010Article 41
  • Constitution of Kenya, 2010Articles 47 and 50

Cases cited (9)

  • Anthony Mkala Chitavi v Malindi Water & Sewerage Co. Ltd
    (2013) eKLR
  • Ulsterbus Ltd v Hendersen
    (1989) IRLR 251 NICA
  • Santemerra v Express Cargo Forwarding
    (2003) 273 EAT
  • Dick & Ar v Glasgow University
    (1993) IRLR 23
  • W Weddel & Co. Ltd v Tepper
    (1980)
  • Simon Patrice Matianyi v G4S Security Services (K) Ltd
    (2013) eKLR
  • Hesbon Ngaruiya Waigi v Equatorial Commercial Bank Ltd
    (2013) eKLR
  • Mary Mutanu Mwendwa v Ayuda Ninos De Afrika-Kenya (Anidan K)
    2013 eKLR
  • Bank of Uganda v Tinkamanyire
    (2009) 2 EA 66
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 over a Memorandum of Claim for unfair/wrongful termination of employment

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, "Patrick Abuya v Institute of Certified Public Accountants of Kenya (ICPAK) & another [2015] KEELRC 154 (KLR)", Case Analysis (2015). Cause No 126 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/154/eng@2015-12-04

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