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ELRCAllowedCause No. 756 of 2010· [2018] KEELRC 2115 (KLR)

Kenya Union of Commercial Food and Allied Workers v British American Tobacco (K) Limited [2018] KEELRC 2115 (KLR)

Employment and Labour Relations Court
6 April 2018
MNMathews N. NdumaMOMaureen Onyango
2,028 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court ruled that BAT unfairly fired three union officials over an expense dispute that should have been resolved as a CBA grievance, awarding them Sh4.4 million.

What this practically means

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Executive summary

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The Kenya Union of Commercial, Food and Allied Workers sued British American Tobacco (K) Limited on behalf of three grievants - Peter Musyimi, Nixon Wasike and Charles Misati - long-serving employees and union shop stewards, alleging wrongful, unlawful and unfair termination. In March 2010, while returning from official travel as members of the respondent's joint consultative council, the grievants submitted expense claims that included Kshs.4,200 each for a night spent at the respondent's Malakisi guest house where they had in fact been accommodated on full board. Management advised the claim be reduced to Kshs.1,050 as a day safari allowance under clause 37 of the CBA. Instead of simply rejecting the excess claim, the respondent charged the grievants with fraud, issued show cause letters, held disciplinary hearings, found them guilty under section 44(4)(g) of the Employment Act and summarily dismissed them. The court held the dispute was a genuine grievance under clause 4.1 of the Recognition Agreement concerning CBA interpretation, and that characterising it as fraud was unprocedural, malicious and unlawful. Termination violated sections 41, 43 and 45 of the Employment Act. Applying section 49(1)(c) and 49(4), and guided by comparable awards by Rika J, the court awarded each grievant twelve months' salary: Kshs.1,426,090 to Musyimi, Kshs.1,634,592 to Wasike and Kshs.1,378,092 to Misati, totaling Kshs.4,438,774, with interest at court rates from judgment until payment in full, plus costs to the claimant.

Key legal issues

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01

Whether the fraud charges provided a valid reason for termination

Holding

The per diem dispute was a CBA grievance, not fraud; termination lacked valid reason under sections 43 and 44 and violated sections 41 and 45 of the Employment Act

Reasoning

The grievants claimed per diem in good faith based on clause 37 of the CBA while management held a contrary view. Such a bona fide disagreement over CBA interpretation was a grievance under clause 4.1 of the Recognition Agreement, to be escalated within the grievance machinery. Labelling it fraud, subjecting the shop stewards to discipline and summary dismissal was unprocedural, malicious and unlawful, and the process could not constitute a fair hearing under section 41.

p. 2
02

Whether the grievants deserved maximum compensation

Holding

Yes - equivalent of 12 months' salary each under section 49(1)(c) read with 49(4) of the Employment Act

Reasoning

The grievants served about 16 years with clean records, acted as shop stewards sustaining healthy labour relations, contributed nothing to their termination, received no substantial terminal benefits, and suffered anguish and loss of career prospects. Comparable awards by Rika J of 10 and 12 months' salary supported maximum compensation, tempered by the diminution in value since dismissal seven years earlier.

p. 3

Legal principles established

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  • A genuine dispute over entitlement under a CBA is a grievance to be handled under the grievance procedure, not a disciplinary charge of fraud
  • Employment Act sections 41, 43 and 45 require valid reason and fair procedure; trumped-up fraud charges against shop stewards amount to unfair termination warranting maximum compensation under section 49

Court orders

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  1. 1.Peter Musyimi awarded Kshs.1,426,090 (118,841 x 12) in compensation
  2. 2.Nixon Wasike awarded Kshs.1,634,592 (136,216 x 12) in compensation
  3. 3.Charles Misati awarded Kshs.1,378,092 in compensation
  4. 4.Total award of Kshs.4,438,774 payable with interest at court rates from date of judgment till payment in full
  5. 5.Respondent to pay costs of the suit

Authorities

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Legislation

  • Employment Actsection 44(4)(g)
  • Employment Actsection 41
  • Employment Actsection 43
  • Employment Actsection 44
  • Employment Actsection 45
  • Employment Actsection 49(1)(c)
  • Employment Actsection 49(4)

Cases cited (2)

  • Christian Samba Obath and Fossil Fuels Limited
    Cause No. 567 of 2015
  • Kenya Union of Commercial, Food and Allied Workers and Mombasa Water Supply and Sanitation Co. Limited & Another
    Cause No. 222 'A' of 2013
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 and Labour Relations Act in respect of the Recognition Agreement and CBA disputes

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, "Kenya Union of Commercial Food and Allied Workers v British American Tobacco (K) Limited [2018] KEELRC 2115 (KLR)", Case Analysis (2018). Cause No. 756 of 2010. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/2115/eng@2018-04-06

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