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ELRCPartially AllowedNot stated in judgment· [2016] KEELRC 1402 (KLR)

Michael Muriuki Ngari, Jim Kennedy Kiriro Njeru, Eric Kamau Kihara , Milka Karimi , Andrew Chris Kirathe Kamonde,Sospeter Kimani Wanjohi Nyambura,Reuben Munene Nyaga, Micah Ontiri Ombongi, Meoli Lemuta Molibash& Michael Kihambilu Lugwili v Equity Bank of (Kenya) Limited (Cause 1430 of 2015) (Employment and Labour) [2016] KEELRC 1402 (KLR)

Employment and Labour Relations Court
6 April 2016
HWHellen Wasilwa
1,550 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~6 min to read original · ~4 min brief

The bottom line

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A Kenyan employment court protected ten dismissed bank staff from credit bureau listing and blocked access to their Sacco accounts until their case is fully heard.

What this practically means

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Executive summary

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This was an interlocutory application dated 13 August 2015, filed under Certificate of Urgency by ten former employees of a bank (the Respondent) who had been summarily dismissed or terminated following investigations into an alleged collusion between employees and valuers to defraud the Respondent. The Applicants complained that their dismissals were procedurally flawed, that the Respondent was unilaterally converting their staff loans from friendly staff rates to commercial rates without notice, that they risked being listed with credit reference bureaus for non-performing loans, and that the Respondent had made clearance by its departments a condition precedent to accessing their savings at Equity Bank Sacco and their terminal benefits. They sought orders restraining CRB listing, restraining interference with their Sacco accounts, and directing that terminal benefits be deposited into a joint interest-earning account. The Respondents opposed, contending that proper disciplinary proceedings were conducted under Section 41 of the Employment Act, that the Applicants committed gross misconduct, and that a bank would be able to meet any award of damages. In a ruling delivered on 6 April 2016, Lady Justice Hellen Wasilwa held that the issues raised went to the manner of dismissal and should be determined at trial, but on the balance of convenience the staff loans should be preserved at their current terms. She allowed the application in terms of prayers 2 and 3 - restraining CRB listing and interference with the Sacco accounts - until trial determination, noting that the Respondent still held the terminal dues and could recover any dues from them.

Key legal issues

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01

Whether the Court should grant interim relief restraining CRB listing and interference with Sacco accounts pending trial

Holding

Yes - the Court granted prayers 2 and 3 on the balance of convenience, holding the orders in force until trial

Reasoning

The Court found the applicants' issues touching on the manner of their dismissal were pertinent and could only be resolved after a full trial. However, converting the staff loans to commercial rates while the claim was pending would cause them immense suffering. Since the Respondent still holds the terminal dues, it would not be prejudiced by the interim orders, and its submission that the accounts can be operated if found to hold funds was treated as an admission justifying prayer 3.

p. 4
02

Whether the disciplinary process and dismissals were lawful

Holding

Left for determination at trial; the Court noted the issues were pertinent but their 'rightful decision will be after hearing their claim in its entirety'

Reasoning

The Applicants alleged the investigations into alleged collusion with valuers were unilateral and flawed, that they were denied fair hearings, and that no evidence showed they received commissions from vendors. The Respondents maintained that proper disciplinary proceedings were taken under Section 41 of the Employment Act and that the Applicants committed gross misconduct. The Court declined to determine these contested issues on an interlocutory application.

p. 4

Legal principles established

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  • Interim preservation may be granted where the balance of convenience favours the party facing conversion of staff loan terms after termination

Court orders

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  1. 1.Application allowed in terms of prayers 2 and 3
  2. 2.Order restraining the Respondent from listing the Applicants before any credit reference bureaus on account of non-performing staff loans pending trial
  3. 3.Order restraining the Respondent from interfering with the Applicants' free, unhindered and voluntary operation of their individual savings and other accounts held at Equity Bank Sacco Limited
  4. 4.Orders to remain in force until the trial determination of the suit

Authorities

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Legislation

  • Employment ActSection 41

Cases cited (1)

  • Mrao Limited vs. First American Bank of Kenya
Jurisdiction invoked
Not stated in judgment (application filed under Certificate of Urgency)

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, "Michael Muriuki Ngari, Jim Kennedy Kiriro Njeru, Eric Kamau Kihara , Milka Karimi , Andrew Chris Kirathe Kamonde,Sospeter Kimani Wanjohi Nyambura,Reuben Munene Nyaga, Micah Ontiri Ombongi, Meoli Lemuta Molibash& Michael Kihambilu Lugwili v Equity Bank of (Kenya) Limited (Cause 1430 of 2015)  (Employment and Labour) [2016] KEELRC 1402 (KLR)", Case Analysis (2016). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/1402/eng@2016-04-06

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