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ELRCPartially AllowedCause No. 1449 of 2014· [2016] KEELRC 1728 (KLR)

Michael Homas Opondo Were v Maths Trading Company Limited [2016] KEELRC 1728 (KLR)

Employment and Labour Relations Court of Kenya at Nairobi
27 January 2016
3,968 words in judgment
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The bottom line

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What this practically means

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Executive summary

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The Claimant, employed as a Warehouse Supervisor on a consolidated salary of Kshs.30,000.00 from April 2013, was summarily dismissed on 20th June 2014 after being arrested and charged with obtaining goods by false pretences arising from the loss of 200 pieces of marine ply released to a customer on 6th May 2014. He claimed salary for June 2014, notice pay, house allowances, salary for the unexpired term of his contract, damages for unfair termination and accrued leave. The Respondent defended the dismissal under section 44 of the Employment Act, asserting reasonable and sufficient grounds to suspect the Claimant's involvement, and that all dues of Kshs.104,684.00 were paid by cheque deposited with the Labour Officer. The court found substantive grounds for dismissal existed, but that the procedure was fatally flawed: the Claimant was not afforded a hearing compliant with section 41, was not given the opportunity to have another employee present, the internal investigations relied on were undocumented and not produced, and the meeting at which he allegedly confessed was not minuted. The dismissal was accordingly unfair under section 45. Remedies were modestly assessed: compensation for the procedural lapse at one month's salary (Kshs.30,000), one month's notice pay (Kshs.30,000), accrued leave (Kshs.30,000) and 20 days' salary for June 2014 (Kshs.20,000), totalling Kshs.110,000, payable from the deposited cheque. Claims for house allowance, unexpired-term salary and 12 months' damages were declined. Each party bears its own costs.

Key legal issues

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01

Whether the summary dismissal was substantively justified under section 44 of the Employment Act

Holding

There were reasonable and sufficient grounds to suspect the Claimant's involvement in a criminal offence against the employer's property, satisfying the substantive test for summary dismissal under section 44(4)(g).

Reasoning

The Claimant was arrested and charged with obtaining goods by false pretences arising from loss of company property. Section 44(4)(g) permits summary dismissal where an employee commits or on reasonable and sufficient grounds is suspected of having committed a criminal offence against or to the substantial detriment of the employer's property. The court found substantive grounds existed, hence no unexpired-term compensation.

p. 6
02

Whether the summary dismissal was procedurally fair under section 41 of the Employment Act

Holding

The dismissal was procedurally flawed: the Claimant was not given a fair hearing, was not afforded the chance to have another employee present, and the internal investigations said to justify dismissal were not documented or produced.

Reasoning

Section 41(2) requires an employer to hear and consider an employee's representations before summary dismissal. The claimed meeting between the Claimant and Vellakkottu had no minutes or records, and no investigation report was produced. The court preferred the Claimant's word because the employer failed to keep records. The dismissal was therefore unfair under section 45.

p. 6
03

Whether the Claimant bore responsibility for the loss given the Respondent's internal checks and balances

Holding

Confirming payment and approving release of goods was the duty of senior officers, not the Claimant; the Claimant acted under supervision and upon approvals.

Reasoning

Evidence established that before goods could be released there was a paper trail from the sales team, and the finance office and senior managers had to verify bank deposits and approve release. Confirming payment was beyond the Claimant's level; due diligence lay with the Respondent's senior officers and managers.

p. 5

Legal principles established

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  • An employer may not summarily dismiss an employee, even with justifiable reason, without adhering to the procedural safeguards of section 41 of the Employment Act, including a hearing and the opportunity to be accompanied by another employee; failure to document investigations and hearings is fatal to the employer's case.

Court orders

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  1. 1.Judgment entered for the Claimant for compensation of Kshs.30,000.00; notice pay of Kshs.30,000.00; leave accrued of Kshs.30,000; and Kshs.20,000.00 for 20 days worked in June 2014
  2. 2.The payments to be drawn from the Kshs.104,684.00 deposited with the Labour Officer by the respondent
  3. 3.Each party to meet its own costs

Authorities

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Legislation

  • Penal Codesection 313
  • Employment Actsection 44(3)
  • Employment Actsection 44(4)(f) and (g)
  • Employment Actsection 41(1) and 41(2)
  • Employment Actsection 45
  • Employment Actsection 35

Cases cited (6)

  • Mary Chemweno Kiptui versus Kenya Pipeline Company Limited
    [2014] eklr
  • Jackson Oyoo versus Sinohydro Corporation Limited
    [2012] eklr
  • Mary Mutanu Mwendwa versus Ayuda Ninos De Africa-Kenya (Anidan K)
    [2013] eklr
  • Alphonse Mwaghanga versus Operation 680 Ltd
    [2013] eklr
  • Abraham Gumba versus KEMSA
    [2014] eklr
  • David Mwangi Gioko & Others versus Nairobi Water & Sewerage Co. Ltd
    [2013] eklr
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act and Labour Relations Act (first-instance employment cause)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (4)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Michael Homas Opondo Were v Maths Trading Company Limited [2016] KEELRC 1728 (KLR)", Case Analysis (2016). Cause No. 1449 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/1728/eng@2016-01-27

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