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ELRCPartially AllowedCause No. 932 of 2013· [2015] KEELRC 1019 (KLR)

Jane Wangui Gichuki v Rift Valley Railways (K) Limited [2015] KEELRC 1019 (KLR)

Employment and Labour Relations Court
25 May 2015
2,851 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 ruled a railway employee's summary dismissal unlawful because the employer never held a proper hearing and couldn't justify it.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent from 25th October 2006 as a Telephone Operator and later promoted to Administrative Assistant, was summarily dismissed on 30th August 2012 on allegations of involvement in a fraudulent transaction concerning a forged LPO No. 9850 from a company known as Data Works. She sought reinstatement without loss of benefits or, alternatively, terminal dues totalling Kshs. 929,263. The Respondent contended she was grossly negligent in failing to report the suspected fraud to superiors and in failing to record a statement with the Railways security officers, relying on its Code of Conduct which classifies negligence as gross misconduct, and cited a Court of Appeal decision. The court framed three issues: validity of reasons for dismissal, procedural fairness, and entitlement. Applying Sections 43, 44(4), 41 and 45(2) of the Employment Act 2007, the court held there were no valid reasons warranting summary dismissal, as negligence of duty could not ground summary dismissal notwithstanding the Code of Conduct, and that failure to cooperate with police was unproved. It further held the mandatory disciplinary hearing under Section 41 was not convened, the employer being obliged to summon the employee rather than await a request, rendering the dismissal unfair. Reinstatement was declined as impracticable after six years of service. The court awarded one month's salary in lieu of notice, twelve months' salary as compensation for unlawful termination (total Kshs. 671,125 less statutory deductions), a certificate of service, and costs against the Respondent.

Key legal issues

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01

Whether there were valid reasons to warrant summary dismissal of the Claimant

Holding

There were no valid reasons to warrant summary dismissal. Failure to report discovery of fraud to a supervisor could warrant some disciplinary measures but summary dismissal was harsh; failure to cooperate with police was not proved.

Reasoning

Section 43 of the Employment Act obliges the employer to prove the reasons for termination, failing which the termination is deemed unfair under Section 45. Although the Respondent's Code of Conduct classified negligence as gross misconduct, the court held that the statutory floor in Section 44(4) of the Employment Act governs. Failing to report a detected forged LPO was wrong but not a proportionate basis for summary dismissal, and the allegation of non-cooperation with police was unsupported.

p. 4
02

Whether due process was followed before the Claimant was dismissed

Holding

Due process was not followed; the dismissal was unfair and unjustified because no oral disciplinary hearing was held.

Reasoning

Section 41 of the Employment Act requires the employer, before termination or summary dismissal, to explain the reasons to the employee and to hear and consider any representations. The hearing is mandatory and it is the employer who must summon the employee. The Respondent's contention that the Claimant never indicated she wanted a hearing offended the express statutory provisions. The committee of four decided to dismiss the Claimant in her absence.

p. 5
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Whether reinstatement was an appropriate remedy

Holding

Reinstatement was declined as impracticable; compensation in lieu was awarded instead.

Reasoning

Section 49(4) of the Employment Act sets out factors to be taken into account before reinstatement, including the practicability of reinstatement, length of service and the employee's prospects of securing comparable employment. The Claimant had served six years and had not established that she could not secure another job. The court therefore granted notice pay and 12 months' compensation instead, plus a certificate of service.

p. 6

Legal principles established

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  • An employer bears the burden of proving valid reasons for termination, and negligence of duty cannot justify summary dismissal even where the employer's code of conduct labels it gross misconduct; the statutory minimum in Section 44(4) of the Employment Act prevails.
  • The disciplinary hearing under Section 41 of the Employment Act is mandatory; it is for the employer to summon the employee to the hearing, not for the employee to request one.

Court orders

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  1. 1.Payment of 1 month salary in lieu of notice of Kshs. 51,625
  2. 2.Payment of 12 months salary as compensation for unlawful termination, Kshs. 51,625 x 12 = Kshs. 619,500, total Kshs. 671,125 less statutory deductions
  3. 3.Issuance of a Certificate of Service to the Claimant
  4. 4.Respondent to meet costs of the suit

Authorities

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Legislation

  • Employment Act 2007Section 41
  • Employment Act 2007Section 42(1)
  • Employment Act 2007Section 43
  • Employment Act 2007Section 44(3)
  • Employment Act 2007Section 44(4)
  • Employment Act 2007Section 45(2)
  • Employment Act 2007Section 49(4)

Cases cited (1)

  • CFC Stanbic Bank Limited vs Danson Mwashako Mwakuwona [2015] eKLR
    Civil Appeal No. 3 of 2014
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act 2007 over dismissal of employment

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, "Jane Wangui Gichuki v Rift Valley Railways (K) Limited [2015] KEELRC 1019 (KLR)", Case Analysis (2015). Cause No. 932 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/1019/eng@2015-05-25

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