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ELRCDismissedNot stated in judgment (Industrial Cause; filed 3rd October 2012)· [2015] KEELRC 711 (KLR)

Noah Sirengo Cheloti v Postbank Savings Bank [2015] KEELRC 711 (KLR)

Industrial Court of Kenya (Employment and Labour Relations Court)
16 June 2015
3,714 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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The Employment and Labour Relations Court dismissed a bank employee's unfair termination claim, holding that a written hearing was enough and unexplained suspicious deposits justified dismissal.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent bank from 1998 and promoted to Assistant Accounts Officer, was dismissed on 10th May 2010 after being asked to explain unusual deposits into his two personal accounts. He had been interdicted on half pay in December 2009 following investigations into a fraud at the Kakamega branch involving forged miscellaneous receipts exceeding Kshs. 12 million, orchestrated by teller David Gitahi, who was later charged and convicted. The Claimant sued for unfair termination, seeking reinstatement or, alternatively, medical allowances, leave allowance, compensation of one month's salary per year of service, withheld interdiction salary, notice pay, costs and interest. The Respondent maintained the dismissal was for just cause and that the Claimant was afforded a hearing through a show-cause letter, a recorded statement and an appeal letter. The court found the Claimant, who bore the burden of proving unfair termination under Section 47(5) of the Employment Act, failed to adequately explain the deposits into his accounts, and that even if not an accomplice, handling stolen money was sufficient cause for dismissal. On procedure, the court held that although an oral hearing is ideal, a written hearing was sufficient and the Constitution does not require an oral hearing in every dismissal. All ancillary reliefs were refused: medical dues are not recoverable retrospectively, notice is not payable on summary dismissal, and withheld interdiction salary is payable only if the interdiction is lifted, which it was not. The suit was dismissed with costs to the Respondent on 16th June 2015.

Key legal issues

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01

Whether the termination was procedurally fair and lawful

Holding

The dismissal was procedural; the show-cause letter, recorded statement, written explanation and appeal letter amounted to a sufficient hearing

Reasoning

The Claimant was interrogated by the investigator, received a show-cause letter, responded in writing, recorded a signed statement, and wrote an appeal. The court held the Constitution does not require an oral hearing in every dismissal, and the written hearing was sufficient. The failure to request an oral hearing under the code of conduct could not be laid at the employer's door, and the constitutional challenge to that provision failed.

p. 5
02

Whether there was substantive justification for the dismissal

Holding

There was just cause: the Claimant could not adequately explain unusual deposits linked to a colleague convicted of fraud against the Respondent

Reasoning

The Respondent's investigator established a nexus between forged miscellaneous receipts used in fraud at the Kakamega branch and deposits into the Claimant's two accounts. Gitahi, who deposited the money, was charged and convicted. The Claimant's explanations (VISA card payments, a soft loan, payments to Gitahi's sister) did not dislodge the suspicion; he also deleted contact numbers. Handling stolen money was itself sufficient cause for dismissal.

p. 5
03

Entitlement to the ancillary reliefs (medical, leave, notice pay, interdiction salary)

Holding

None of the ancillary reliefs were payable

Reasoning

Medical dues are concomitant with employment and not recoverable retrospectively. Notice pay is not payable on summary dismissal. Withheld interdiction salary is payable only if the interdiction is lifted, which it was not, per the authority the Claimant himself relied on. Having failed to prove unfair termination, the compensation claim also fell away.

p. 5

Legal principles established

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  • The burden of proving unfair termination rests on the employee, while the burden of justifying the grounds for termination rests on the employer
  • An oral hearing is not constitutionally mandated in every employee dismissal; a written hearing through a show-cause process, statement and responses can suffice
  • Handling stolen money, even if not an accomplice to the fraud, is sufficient cause for dismissal

Court orders

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  1. 1.The Claimant's suit is dismissed
  2. 2.The Claimant to pay the costs of the suit

Authorities

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Legislation

  • Employment ActSection 47(5)
  • Employment ActSections 41 and 43
  • Employment ActSection 47(5) and 43(2)
  • Constitution of KenyaNot specified (invoked on alleged unconstitutionality of code of conduct hearing provision)

Cases cited (9)

  • Catherine Wanja Njeru v Kenya Post Office Savings Bank
    Cause No. 53 of 2011
  • Alphonce Machanga Mwachanya v Operation 680 Limited
    [2013] eKLR
  • Walter Ogal Anuro v Teachers Service Commission
    [2013] eKLR
  • Kenya National Examination Council v Republic ex parte Gathenji and Others
    Civil Appeal No. 266 of 1996
  • Joseph Omwenga v Kenya Revenue Authority
    Cause No. 811 of 2011
  • Dishon Onkaba v Factory Guards (Msa) Limited
    Cause No. 430 of 2013
  • John Kennedy Ongadi v Kenya Power & Lighting Co. Ltd
    Cause No 50 of 2012
  • Grace Gacheru Muriithi v Kenya Literature Bureau
    [2012] eKLR
  • Jane Frances Angalia v National Cohesion & Integration Commission
    Cause No. 1647 of 2012
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over employment claims under the Employment Act 2007 (as pleaded; sections 41, 43, 47(5) applied)

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, "Noah Sirengo Cheloti v Postbank Savings Bank [2015] KEELRC 711 (KLR)", Case Analysis (2015). Not stated in judgment (Industrial Cause; filed 3rd October 2012). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/711/eng@2015-06-16

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