Mary Wacheke Thongoh-Muia v Central Bank of Kenya & Patrick Ngugi Njoroge [2019] KEELRC 167 (KLR)
The bottom line
#A Kenyan court ruled the Central Bank of Kenya wrongly disciplined a dismissed executive, awarding her Sh14.4 million but rejecting her larger payout claims.
What this practically means
#Executive summary
#Key legal issues
#Whether the termination letter dated 21.9.2015 founded a viable cause of action
No - the demand for rescission was granted on 2.10.2015 and that cause of action ended
The claimant demanded immediate rescission of the termination letter, and the 2nd respondent withdrew it and expunged it from her records. The court held the dispute over the termination letter ended, and that cause of action was no longer a proper basis for the suit.
Whether the claimant deserted her employment
No - the parties mutually agreed to terminate the contract from 6.10.2015
The correspondence after rescission showed the parties had, in principle, agreed to separate mutually, with only the terms (three months' salary in lieu versus unexpired contract salary) outstanding. The claimant therefore had good cause not to report back and did not desert.
Whether the claimant was bound to respond to the show cause letter of 15.1.2016
No - the contract had already ended by mutual agreement
Since the claimant was right to treat the contract as ended by the time the notice was served on 18.1.2016, the disciplinary process was overtaken by events. The court observed that the show cause letter also implicated the 2nd respondent for having denied her due process under section 41 of the Employment Act at the time of the aborted termination.
What remedies flow from the mutual termination
Four months' salary (September 2015 plus three months in lieu of notice) and pro rata gratuity at 30%; no unexpired-term salary, leave, medical, defamation or constitutional damages
The contract allowed termination on three months' notice or pay in lieu, so unexpired-term salary was refused. Gratuity at 30% was payable for the period worked (32 months). Leave, medical and insurance claims failed for lack of particulars and evidence, and defamation failed for want of proof. The car loan balance was set off.
Legal principles established
#- A termination notice cannot be unilaterally withdrawn; withdrawal requires mutual agreement between the parties
- Once a termination letter is rescinded by mutual agreement, the employee's status is restored and she should report back to work
- Where parties negotiate a mutual separation, the employee has good cause not to report to work pending agreement on terms
Court orders
#- 1.Judgment entered for the claimant against the 1st respondent in the sum of Kshs. 14,418,676.72 less statutory deductions and car loan balance of Kshs. 3,214,218.00
- 2.Interest on the judgment sum at court rates
- 3.Costs of the suit awarded to the claimant against the 1st respondent
- 4.Claim for salary for the unexpired period of the fixed term contract dismissed; claimant awarded four months' salary (Kshs. 4,240,805.80) being September 2015 salary plus three months' salary in lieu of notice
- 5.Claimant awarded pro rata gratuity at 30% for 32 months (Kshs. 10,177,933.92)
- 6.Claims for leave, medical premium and insurance, defamation and constitutional damages dismissed
- 7.Claim against the 2nd respondent dismissed entirely for misjoinder
- 8.Reliefs to invalidate termination, declare breach of contract, and restrain fresh disciplinary proceedings declined
- Jurisdiction invoked
- Employment and Labour Relations Court Act, section 12 (3) (iv) invoked; original employment jurisdiction under Article 41 read with the Employment Act
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Mary Wacheke Thongoh-Muia v Central Bank of Kenya & Patrick Ngugi Njoroge [2019] KEELRC 167 (KLR)", Case Analysis (2019). Cause No 51 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/167/eng@2019-11-29
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.