Musa Ogaro Osoro v Wakenya Pamoja Sacco Society Ltd [2018] KEELRC 577 (KLR)
The bottom line
#A Kenyan court ruled the Sacco unfairly sacked its internal auditor without a hearing, awarding him about Kshs.607,635, though he still owed loan money.
What this practically means
#Executive summary
#Key legal issues
#Whether the reasons for termination were valid and fair
The respondent failed to prove the alleged misconduct; the theft allegation was disproved by acquittal following a Document Examiner's finding and absenteeism was disproved by the Attendance Register.
The dismissal letter listed eight offences including theft of Kshs.300,000. Defence witnesses admitted the claimant was exonerated by a Document Examiner in the criminal case, and the claimant produced attendance records proving he was at work. The court therefore found no valid and fair reason for termination.
Whether the termination procedure was fair
Procedurally unfair; the claimant was never given a show cause letter or hearing, and dismissal was communicated via newspaper notice contrary to Section 41.
Both defence witnesses confirmed no show cause letter was issued and no hearing accorded before dismissal, and that termination was communicated through public newspaper notices. Section 41 mandates explanation of reasons in the employee's presence with a companion and invitation to make representations before termination.
What reliefs follow from unfair termination
Notice pay of 3 months' salary plus maximum compensation of 12 months' salary under Sections 49 and 50, totalling Kshs.607,635 based on gross pay of Kshs.40,509.
Maximum compensation was justified by the claimant's 10 years of service and absence of proven contributory misconduct. Notice pay of three months reflected the respondent's management staff terms of service. Other heads of damages were dismissed for lack of pleading, proof or legal basis.
Whether the respondent's counter claim for outstanding loans should be allowed
Allowed in part; the full loan balance of Kshs.990,620.89 per the January 2013 payslip was owing, but after setting off the claimant's award a balance of Kshs.382,985.89 was due to the respondent.
The claimant admitted outstanding loans but disputed the balance; the credit manager admitted the outstanding balance was unknown and no proof showed guarantors had paid. In view of the uncertainty, the court allowed the counter claim based on the January 2013 payslip figures and set off the award against it.
Legal principles established
#- Termination is unfair under Section 45(2) of the Employment Act unless the employer proves both a valid and fair reason and a fair procedure.
- An employer must accord an employee a hearing under Section 41 of the Employment Act before terminating on grounds of misconduct; dismissal communicated only by newspaper notice is procedurally unfair.
- Claims for emoluments, arrears and pending salary are in the nature of special damages and must be specifically pleaded and proved.
Court orders
#- 1.Entered judgment for the respondent on the counter claim in the sum of Kshs.382,985.89 (counter claim of Kshs.990,620.89 less award to claimant of Kshs.607,635) plus interest from the date of judgment
- 2.Each party to bear their own costs
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act (Sections 41, 45, 49 and 50) over a claim for unfair termination
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Musa Ogaro Osoro v Wakenya Pamoja Sacco Society Ltd [2018] KEELRC 577 (KLR)", Case Analysis (2018). Employment and Labour Relations Court Claim (amended memorandum of claim filed 13.7.2017; number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/577/eng@2018-11-23
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.