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ELRCPartially AllowedCause No. 1780 of 2015· [2019] KEELRC 316 (KLR)

Caroline Nancy Atieno Sikuku v Kujenga Maisha East Africa (KEMEA) [2019] KEELRC 316 (KLR)

Employment and Labour Relations Court of Kenya
31 October 2019
HWHellen S. Wasilwa
2,632 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court ruled the dismissal unfair because the employer proved only some reasons and never gave the employee a hearing, awarding six months' salary.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent as Programs Manager on a two-year contract from 01/01/2014, was terminated by letter dated 23/02/2015 on four grounds: unauthorised private use of the official vehicle, irregular accounting of travel imprest resulting in questionable receipts of Kshs. 58,000, misrepresentation of amounts paid to training beneficiaries in Mtuabare, and mismanagement of supplier payments. She claimed damages for wrongful and unfair termination, unpaid salary and pension to the contract's expiry, severance pay, costs and interest. The Respondent maintained the dismissal was summary and justified under Sections 44(3) and (4) of the Employment Act and that all terminal dues were paid. The court found that the Claimant's apology letter admitted only some impropriety in accounting presentation, not the alleged loss of Kshs. 58,000, and that there was no evidence supporting the vehicle-use and supplier-payment grounds, so the Respondent only partly proved a valid reason. On procedure, no show-cause letter, hearing summons or minutes of the disciplinary process were produced, breaching Section 41 of the Employment Act. Applying Section 45(2), the court declared the termination unfair and unjustified. The court awarded 6 months' salary as compensation (Kshs. 510,000) — reduced because of the Claimant's partial admission of wrongdoing — and costs of the suit. The claims for unpaid salary, pension and severance were not awarded.

Key legal issues

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01

Validity of the reasons for termination

Holding

The Respondent only partly proved a valid reason; the allegations of irregular vehicle use and irregular supplier payments were unsupported by evidence

Reasoning

The court examined each ground in the termination letter. The Claimant's apology letter admitted only that some participants signed sheets for others, not that she falsified accounts causing a loss of Kshs. 58,000. No evidence showed irregular use of the company vehicle or which suppliers she paid irregularly, so only some grounds were substantiated.

p. 4
02

Procedural fairness under Section 41 of the Employment Act

Holding

The Claimant was not accorded a fair hearing; no summons to a hearing or minutes of any hearing were produced

Reasoning

Section 41(1) and (2) require an employer to explain the reasons for termination to the employee, allow a companion, and hear representations before termination or summary dismissal. RW3 confirmed there was no written communication asking the Claimant to show cause, and no minutes of the purported hearing or board resolution were submitted. The termination therefore failed the procedural fairness test.

p. 4
03

Unfair termination under Section 45(2) of the Employment Act

Holding

The termination was unfair and unjustified because the employer failed to prove a valid reason and fair procedure

Reasoning

Section 45(2) places the burden on the employer to prove that the reason for termination was valid, that it was a fair reason related to conduct, capacity or compatibility or operational requirements, and that fair procedure was followed. Having found the reasons only partly proved and no hearing accorded, the court declared the termination unfair and unjustified.

p. 4
04

Quantum of compensation

Holding

Compensation limited to 6 months' salary (Kshs. 510,000) because the Claimant admitted some wrongdoing in her apology letter

Reasoning

Although the termination was unfair, the Claimant had admitted to some impropriety in how she presented the training accounts. The court therefore exercised discretion under the remedies provisions to award 6 months' salary as compensation rather than the 12 months' maximum, together with costs of the suit.

p. 4

Legal principles established

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  • An employer must both prove a valid reason for termination and demonstrate that the employee was taken through a fair disciplinary process, including a hearing under Section 41 of the Employment Act, before a termination is fair

Court orders

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  1. 1.Declaration that the Claimant's termination was unfair and unjustified
  2. 2.Respondent to pay the Claimant 6 months' salary as compensation for unlawful termination, computed as 6 x 85,000 = Kshs. 510,000
  3. 3.Respondent to pay costs of the suit

Authorities

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Legislation

  • Employment Act, 2007Section 41(1) and (2)
  • Employment Act, 2007Section 42(1)
  • Employment Act, 2007Section 44(3) and (4)
  • Employment Act, 2007Section 45(2)
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (employment dispute)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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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, "Caroline Nancy Atieno Sikuku v Kujenga Maisha East Africa (KEMEA) [2019] KEELRC 316 (KLR)", Case Analysis (2019). Cause No. 1780 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/316/eng@2019-10-31

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