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ELRCPartially AllowedCause No 263 of 2013· [2015] KEELRC 1032 (KLR)

Margaret Auma Ingwe v Kenya Power and Lighting Co. Ltd [2015] KEELRC 1032 (KLR)

Employment and Labour Relations Court
5 June 2015
2,798 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A cashier wrongly fired over a cash handover won compensation because Kenya Power gave her only one day to prepare her defence.

What this practically means

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Executive summary

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The Claimant, a Cashier employed by Kenya Power and Lighting Co. Ltd from 1986, was summarily dismissed on 21st June 2012 after handing over Kshs.642,618 from the company's cash box to unidentified men who had threatened her at Electricity House, Nairobi. She had reported the loss to her supervisor the next day and was later acquitted in Criminal Case No 2281 of 2012 at Makadara under Section 202 of the Criminal Procedure Code. She claimed reinstatement, a declaration that her termination was unfair, notice pay, unpaid salaries and maximum 12 months' compensation, alleging violation of the Employment Act, the CBA and company procedures. The Respondent defended the dismissal for fraud and negligence of duty and counterclaimed for the lost Kshs.642,618. The Court framed three issues: valid reason, due procedure, and the counterclaim. It found a valid reason under Section 43, holding the Claimant's failure to report the threat in a secured station unreasonable, and rejected the argument that her criminal acquittal immunised her from discipline, since criminal trials and disciplinary proceedings are distinct processes. However, the disciplinary process was procedurally unfair under Section 41: the hearing invitation was served only a day before the hearing and her representatives and witnesses were excluded. Reinstatement was refused as the valid-reason finding placed it beyond her reach; she was instead awarded 8 months' salary in compensation plus one month's notice pay, totalling Kshs.807,912. The counterclaim for Kshs.642,618 was allowed. Each party was ordered to bear its own costs.

Key legal issues

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01

Valid reason for summary dismissal under Section 43

Holding

The Respondent had a valid reason - the Claimant handed over company funds entrusted to her to unknown persons without authority and failed to report the threat

Reasoning

Section 43 places the burden on the employer to demonstrate, on a balance of probability, a valid reason that would move a reasonable employer to terminate. It was common cause the Claimant handed over the funds; the issue was whether lawful and reasonable. Her failure to report the threat despite a secured station and an established chain of command meant the dismissal was substantively fair.

p. 5
02

Effect of criminal acquittal on disciplinary proceedings

Holding

Acquittal does not bar or invalidate an employer's internal disciplinary process

Reasoning

A criminal trial and internal disciplinary proceedings are distinct processes with different procedural and standards of proof. An employer may rely on or go against the outcome of a criminal trial without that rendering its decision wrongful, and it must conclude its own process rather than abdicating it to the criminal prosecution.

p. 4
03

Procedural fairness under Section 41

Holding

The dismissal was procedurally unfair because the Claimant was not given adequate time to prepare her defence

Reasoning

The disciplinary hearing invitation letter was served only the day before the hearing, and the Claimant's representatives and witnesses were excluded because their names were submitted past a deadline. This denied her the opportunity to prepare and present her defence contemplated by Section 41 and the CBA.

p. 6
04

Respondent's counterclaim

Holding

The counterclaim for Kshs.642,618.00 was allowed as the Claimant's conduct in handing over the money was wrongful

Reasoning

The Claimant admitted handing over the funds entrusted to her. Having found that her action was wrongful despite the substantive fairness of termination, the Court held the Respondent entitled to recover the lost sum from her.

p. 6

Legal principles established

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  • An acquittal in a criminal case does not automatically render an employee immune to internal disciplinary action by an employer, the two being distinct processes with different standards of proof
  • An employer cannot rely on the pendency of a criminal trial to keep an employee under discipline indefinitely; it must conclude its own disciplinary process
  • Under Section 41 of the Employment Act, an employee facing disciplinary action must be afforded sufficient time to prepare and present a defence, including calling witnesses

Court orders

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  1. 1.8 months' salary in compensation for unfair termination (Kshs.718,144.00)
  2. 2.1 month's salary in lieu of notice (Kshs.89,768.00)
  3. 3.Total award of Kshs.807,912.00 in favour of the Claimant
  4. 4.Claimant's claims for reinstatement, unpaid salaries and money withheld dismissed
  5. 5.Respondent's counterclaim for Kshs.642,618.00 allowed
  6. 6.Each party to bear their own costs
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 over unfair termination claim

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, "Margaret Auma Ingwe v Kenya Power and Lighting Co. Ltd [2015] KEELRC 1032 (KLR)", Case Analysis (2015). Cause No 263 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/1032/eng@2015-06-05

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