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ELRCPartially Allowed(Memorandum of Claim filed 27th November 2017)· [2018] KEELRC 1089 (KLR)

Callen Gatune Francis v Tharaka Nithi County Government & another [2018] KEELRC 1089 (KLR)

Employment and Labour Relations Court
18 September 2018
4,442 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~18 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled that even a county government must follow fair procedure when suspending an employee, and that employers making counterclaims must actually prove their losses.

What this practically means

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Executive summary

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The Claimant, former Principal Human Resources Officer of the County Public Service Board of Nyandarua, was demoted in August 2017 and sent on indefinite compulsory leave on 11th September 2017 without a disciplinary hearing, following a staff audit that revealed 108 ghost workers and criminal charges at Chuka Law Courts. She sued seeking a declaration that the compulsory leave was void, unpaid salaries, reinstatement, costs and interest. The Respondents filed a defence and counterclaim alleging she fraudulently inserted her husband and 108 ghost workers into the payroll, breaching her fiduciary duty, and sought restitution of salaries paid to the ghost workers, contending her contract was unenforceable for illegality and that her suit was premature as she should first have appealed to the Public Service Commission. The court framed four issues: due process in the suspension, salary due, liability for the ghost-worker losses, and costs. It held that while the authority to act existed, the suspension was undertaken without the safeguards of Sections 75 and 76 of the County Governments Act and Section 41 of the Employment Act, breaching natural justice; it made a declaration to that effect and awarded half pay from the date of suspension until removal by dismissal letter. The illegality and prematurity arguments were rejected, the latter on the basis that dismissal and suspension disputes belong in this court. The counterclaim failed as unproved, no figure of loss having been availed, and was dismissed with no order as to costs. The Claimant received costs limited to half the scale fees.

Key legal issues

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01

Whether the compulsory leave and interdiction followed due process

Holding

The Respondents did not follow due process; the suspension was in breach of statute and natural justice although there appeared to be a basis for it

Reasoning

Sections 75 and 76 of the County Governments Act as read with Section 41 of the Employment Act required the employer to take disciplinary action in consonance with the Constitution and rules of natural justice. The Claimant ought to have received the accusation, an opportunity to defend herself and the outcome. No such step was taken, placing her in limbo without a disciplinary process. The manner of the suspension was therefore clearly in breach of statute, entitling her to a declaration and damages.

p. 4
02

Whether the compulsory leave letter was ultra vires for want of delegated authority from the County Public Service Board

Holding

The letter was not invalid for want of a stated delegation; the official who sent it is imbued with statutory authority and a Board need not reiterate its authority in every communication

Reasoning

The court accepted the objects of the County Governments Act give the Respondents power to deal with workplace disciplinary issues. The County Secretary issued the letter on behalf of the Board, and the authority exercised by a Board need not be restated in every communication. The failure was procedural (no hearing) rather than lack of authority.

p. 4
03

Whether the Claimant's salary was due and payable

Holding

The Claimant is entitled to half pay from the date of suspension until removal from office through a dismissal letter

Reasoning

An employee on suspension is entitled to half salary as of right; the Claimant's last salary was received in July 2017. As she is not currently on suspension, the award is limited to half pay for the period of suspension until formal dismissal. The court adopted the principle, relied on by the Claimant, that an employee is entitled as of right to earn wages.

p. 4
04

Whether the Claimant was liable for the salaries paid to the 108 ghost workers under the counterclaim

Holding

The counterclaim failed as unproved; no figure of the alleged loss was availed and no letter linked to the Claimant was produced

Reasoning

The Respondents alleged the Claimant fraudulently inserted her husband and 108 ghost workers into the payroll and sought restitution of all salaries paid. However, no figure of the sums allegedly lost was produced, no letter authored to the ghost workers was availed, and the list of ghost workers did not indicate who compiled it. Mere assumption that the insertion was her work, based on her husband's inclusion, fell far short of proof.

p. 4
05

Whether the contract of employment was unenforceable for illegality as contended by the Respondents

Holding

The Respondents' argument on illegality was misplaced; the contract of employment was not made with the object of committing a crime or tort or defrauding a third party

Reasoning

Applying Cheshire, Fifoot and Furmston, an agreement is illegal if its object is the commission of a crime or tort or defrauding a third party. The Claimant's contract had no such object; she was accused of actions in breach of the contract, which is a different matter. The Respondents therefore failed to properly place the illegality argument before the court.

p. 3
06

Whether the suit was premature for want of recourse to the Public Service Commission appeal process

Holding

The PSC appeal route applies to complaints on appointment; disputes on dismissal, suspension or removal from office lie before this court

Reasoning

The court distinguished the Public Service Commission Act complaints mechanism, which relates to the criteria and manner of appointment, from employment disputes. For issues of appointment, the PSC appeal must be exhausted first; but for dismissal, suspension or removal, the court is the proper and natural forum under Article 41 and the Employment Act. The premature-suit objection therefore did not defeat the claim on the process followed.

p. 4

Legal principles established

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  • An employee is entitled to due process even where a suspension is to take effect - at the least, the accusation, an opportunity to defend herself and the outcome of the employer's determination
  • An employee of the Respondents is entitled to the safeguards under the Employment Act including the rights under Article 41 of the Constitution, and this court is the proper forum for disputes on dismissal, suspension or removal from office
  • A Board acts through persons and its authority does not have to be reiterated in every communication emanating from it
  • A party seeking restitution for monies paid to ghost workers must prove the sums allegedly lost

Court orders

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  1. 1.A declaration that the suspension of the Claimant was not in accord with the provisions of the law
  2. 2.Half pay from the date of suspension till removal from office through a dismissal letter
  3. 3.Dismissal of the Respondents' counterclaim with no order as to costs
  4. 4.Costs of the suit limited to a half of the scale fees to the Claimant

Authorities

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Legislation

  • Constitution of Kenya 2010Article 41(1) and (2)(a)
  • Constitution of Kenya 2010Article 47(1) and (2)
  • Constitution of Kenya 2010Article 200
  • Constitution of Kenya 2010Article 235
  • Employment ActSections 41, 43, 45, 47(5)
  • County Governments Act 2012Sections 59(1)(c), 75, 76, 86
  • Public Service Commission Actprovisions on appeals
  • Penal Codeobtaining by false pretence and cheating

Cases cited (6)

  • Simon Waringa Namakhwaba v Mr. Ajanja (Chairman) & Samanani Azam t/a Hoggers Limited
    [2018] eKLR
  • Makenzie v Smith
    (1996) IRLR, 345
  • Mapis Investments (K) Ltd v Kenya Railway Corporation
    Nairobi Civil Appeal No. 14 of 2005 (unreported)
  • Nabro Properties Limited v Sky Structures Limited
    (2000) Vol. 2 KLR 299
  • James Tinai Murete & Others v County Government of Kajiado & 22 Others
    [2015] eKLR
  • Auckland Harbour Board v R
Jurisdiction invoked
Articles 41(1) & (2)(a) and 47(1) and (2) of the Constitution of Kenya 2010; Employment Act (Sections 41, 43, 45, 47(5)); County Governments Act 2012 (Sections 59, 75, 76)

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, "Callen Gatune Francis v Tharaka Nithi County Government & another [2018] KEELRC 1089 (KLR)", Case Analysis (2018). (Memorandum of Claim filed 27th November 2017). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/1089/eng@2018-09-18

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