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ELRCPartially AllowedNot stated in judgment (Cause commenced 25 July 2013)· [2015] KEELRC 1089 (KLR)

William Ekamais Ewoi & another v Vegpro Kenya Ltd [2015] KEELRC 1089 (KLR)

Employment and Labour Relations Court
22 May 2015
RSRadido Stephen
2,225 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court ruled that firing staff for suspected theft without giving them a hearing makes the dismissal unfair, even if the employee was later acquitted.

What this practically means

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Executive summary

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Two storekeepers employed by Vegpro Kenya Ltd were summarily dismissed on 21 February 2012 over alleged systematic fraud in the stores after an audit revealed over 100,000 kgs of fertiliser worth over Kshs 3,800,000 missing. They had earlier been charged with stealing by servant but were acquitted on 21 May 2013, after which they jointly sued for unfair termination. The court found the dismissals procedurally unfair: the Respondent claimed show cause letters were issued and answered, but the correspondence was allegedly plucked from the employees' files, the Human Resource officer who issued them was neither identified nor called, and the audit and meetings with the General Manager did not meet the hearing requirement of section 41 of the Employment Act. The court rejected the Respondent's argument that pending police investigations excused a hearing, holding the Kenyan statutory framework takes precedence over ILO Convention No. 158. The court declined to determine whether the reasons for dismissal were proved or valid. On remedies, it refused gross pay for the 15 months of the criminal trial, holding the cause of action accrued on dismissal, not acquittal, and such compensation applies only to unlawful suspensions. It refused gratuity since contracts did not provide for it and the Claimants were NSSF contributors. It awarded the 1st Claimant Kshs 168,667/- (4 months' compensation, unpaid wages, off days and accrued leave) and the 2nd Claimant Kshs 73,083/- (5 months' compensation and similar heads), with costs of Kshs 75,000/-.

Key legal issues

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01

Procedural fairness of the dismissals

Holding

Dismissals were procedurally unfair as the Respondent failed to prove that show cause letters were issued and a hearing held

Reasoning

Section 41 of the Employment Act requires the employee to be informed of allegations and be heard. The Respondent claimed show cause letters were issued and answered, but could not produce the correspondence and did not disclose or call the Human Resource officer who allegedly issued them. Audit meetings did not amount to a hearing under section 41. The dismissal was therefore procedurally unfair.

p. 2
02

Claim for wages during pendency of criminal trial

Holding

Rejected; cause of action accrued on dismissal date, not acquittal date

Reasoning

The Claimants relied on Ongaya J's decision entitling employees to pay for periods kept away from work. The Court disagreed, holding such a principle applies only to unlawful suspensions. The actionable wrong occurred on 21 February 2012 upon dismissal; acquittal on 21 May 2013 did not revive the employment relationship. The statute provides the remedies for unfair termination.

p. 3
03

Compensation under section 49

Holding

4 months' gross wages for the 1st Claimant and 5 months for the 2nd Claimant

Reasoning

Compensation is discretionary and fettered by section 49(4) factors. The 1st Claimant served about 3 years, had reasonable expectation of continued service and found alternative employment in 2013; 4 months' gross wages based on Kshs 24,500/-. The 2nd Claimant served about 4 years but did not prove his gross wage; the February 2012 pay slip showing Kshs 5,434/- was used, awarding 5 months.

p. 4

Legal principles established

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  • A hearing is mandatory under section 41 of the Employment Act where termination is for misconduct, poor performance or incapacity
  • An employer with no records of disciplinary proceedings must demonstrate through other evidence that it followed a fair procedure
  • Kenyan statutory framework on the right to a hearing prevails over reliance on ILO conventions

Court orders

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  1. 1.Declaration that the summary dismissals of the Claimants were procedurally unfair
  2. 2.1st Claimant awarded Kshs 168,667/- (4 months gross wages compensation Kshs 98,000/-; unpaid wages January/February 2012 Kshs 38,447/-; off days Kshs 11,277/-; 26 accrued leave days Kshs 20,943/-)
  3. 3.2nd Claimant awarded Kshs 73,083/- (5 months gross wages compensation Kshs 27,170/-; unpaid wages January/February 2012 Kshs 13,693/-; 18 off days Kshs 11,277/-; 28 accrued leave days Kshs 20,943/-)
  4. 4.Claims for gross pay for 15 months and gratuity dismissed
  5. 5.Claimants awarded costs of Kshs 75,000/-

Authorities

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Legislation

  • Penal Codesection 281
  • Criminal Procedure Codesection 210
  • Employment Act, 2007section 41
  • Employment Act, 2007section 43
  • Employment Act, 2007section 45
  • Employment Act, 2007section 49(4)
  • Employment Act, 2007section 35(5)
  • Employment Act, 2007section 10(3)

Cases cited (3)

  • Peter Onyango Nyabongo v Citadelle Security Ltd
    (2015) eKLR
  • Keziah Nduta Kiema & Ors v Lion Niru Shah, Lions School Management Board
    (2014) eKLR
  • Kenya Union of Printing, Publishing, Paper Manufacturers and Allied Workers v Timber Treatment International Ltd
    (2013) eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over unfair termination claims under the Employment Act, 2007

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, "William Ekamais Ewoi & another v Vegpro Kenya Ltd [2015] KEELRC 1089 (KLR)", Case Analysis (2015). Not stated in judgment (Cause commenced 25 July 2013). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/1089/eng@2015-05-22

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