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Case Brief · caselaw.co.ke
ELRCPartially AllowedCause No 545 of 2014· [2016] KEELRC 1034 (KLR)

J M D v Nacico Sacco Society Limited [2016] KEELRC 1034 (KLR)

Employment and Labour Relations Court
3 June 2016
1,489 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~6 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled an employee's fraud-based dismissal unfair because the employer had no written complaint, called no key witness, and skipped a fair hearing.

What this practically means

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Executive summary

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The claimant, formerly employed by the respondent as an accounts clerk, sued for unlawful and unfair termination of her employment on 31st December 2012 and for terminal dues and compensatory damages, alleging she was dismissed without notice or a hearing and contrary to the Employment Act. She alleged she was accused of assisting a customer to withdraw money without remitting the full amount, was suspended without pay, never underwent a disciplinary hearing, and that the customer later withdrew the complaint in writing. She also alleged sexual advances by the chairman, which she had reported only to her union. The respondent maintained the dismissal was lawful, that the claimant was given a show-cause letter and an opportunity to respond, and that fraud involving a customer's funds justified termination. The respondent's witness confirmed an internal investigation, a board recommendation, and an unsuccessful appeal. The court held that dismissal must be for valid and justifiable reasons and through fair procedure. It found the reasons wanting: no written complaint from the customer was produced, the customer was not called as a witness, and he later exonerated the claimant in a note that was never contested; the respondent's own supervisory committee found the staff were not accorded a fair hearing. The court declared the termination unfair and ordered payment of three months' salary in lieu of notice, ten months' salary as compensation for unfair dismissal, and costs of the suit, with parties to liaise with the Deputy Registrar for computation of the award.

Key legal issues

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01

Validity of the reason for dismissal

Holding

There were no valid or justifiable reasons for the termination

Reasoning

The charge was fraud in collecting money on behalf of a customer. The customer's complaint was verbal and no written complaint was produced; the customer was not called as a witness; the customer later wrote exonerating the claimant; and the respondent's own supervisory committee found she was not accorded a fair hearing. These factors considerably weakened the respondent's justification.

p. 3
02

Fairness of the procedure

Holding

The process fell short of a fair hearing; the committee report indicated the staff were not accorded a fair hearing and the respondent failed to rebut it

Reasoning

Although the respondent asserted a show-cause letter and responses, the claimant's evidence and the supervisory committee report indicated no fair hearing. The respondent could have called a committee member to clarify but did not, and the exculpatory note from the customer was never contested.

p. 3
03

Remedies for unfair termination

Holding

Notice pay of three months and compensation of ten months' salary

Reasoning

Having found the termination unfair, the court exercised its discretion under the Employment Act to award three months' salary in lieu of notice and ten months' salary as compensation, together with costs, with computation referred to the Deputy Registrar.

p. 3

Legal principles established

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  • Dismissal must be for valid and justifiable reasons and through fair procedure, failing which the dismissal is unfair
  • The onus of justifying and proving reasons for dismissal rests with the employer while the burden of showing the dismissal was unfair is on the employee

Court orders

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  1. 1.Declaration that the termination of the claimant's employment was unfair
  2. 2.Payment of three months salary in lieu of notice
  3. 3.Ten months salary as compensation for unfair dismissal
  4. 4.Costs of the suit to the claimant
  5. 5.Parties to liaise with the Deputy Registrar for computation of the actual figure of the award

Authorities

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Legislation

  • Employment ActNot specified
Jurisdiction invoked
Employment Act, 2007 (reference in the pleadings and submissions; no express constitutional provision invoked)

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, "J M D v Nacico Sacco Society Limited [2016] KEELRC 1034 (KLR)", Case Analysis (2016). Cause No 545 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/1034/eng@2016-06-03

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