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Case Brief · caselaw.co.ke
ELRCPartially AllowedNot stated in the extract (Statement of Claim dated 16th October 2015)· [2019] KEELRC 804 (KLR)

Shadrack Olindi Esikote v East African Packaging Industries Limited [2019] KEELRC 804 (KLR)

Employment and Labour Relations Court
16 September 2019
3,376 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 awarded a sacked employee over Kshs.636,000 because his employer never proved bribery claims or followed a fair disciplinary process.

What this practically means

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Executive summary

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The Claimant, a Conversion Supervisor/Manager employed by the Respondent since 1996, was summarily dismissed on 7th September 2015 over allegations that he solicited and received bribes from temporary workers. He sued for a declaration that his termination was unlawful and unfair, terminal dues and 12 months' salary as compensation. The Respondent defended the dismissal as summary dismissal for gross misconduct under Section 44(4)(g) of the Employment Act, relying on its Staff Handbook and an investigations report, and contended the Claimant bore the burden of proving unfairness. The court framed three issues: valid reasons, due process, and remedies. On the first, it found the bribery allegations were never established because the accusers were neither called at the disciplinary hearing nor as witnesses in court, and RW2 admitted no evidence of bribery was submitted; the dismissal letter also omitted details of the misconduct, contrary to Section 43. On the second, the disciplinary hearing was adjourned for investigations that were never conducted and no witnesses were called, breaching Section 41. The court declared the termination unfair and unlawful and entered judgment for the Claimant, awarding 10 months' salary as compensation (Kshs.578,310) and one month's salary in lieu of notice (Kshs.57,831), totalling Kshs.636,141, with costs and interest at court rates from the date of judgment. Judgment was delivered by Hon. Lady Justice Hellen Wasilwa on 16th September 2019.

Key legal issues

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01

Valid reasons for termination under Section 43

Holding

No valid reason was established for the summary dismissal under Section 44(4)(g); the bribery allegations were never proved

Reasoning

The dismissal letter did not state details of the misconduct. The show cause letter alleged receipt of bribes, but at the disciplinary hearing the accusers were not called and no evidence of the bribes was submitted. RW2 admitted no evidence of bribery was produced and that promised investigations were never done. The court held the employer failed to discharge the burden under Section 43 to prove valid reasons for termination.

p. 4
02

Procedural fairness under Section 41

Holding

Due process was not followed; the hearing was incomplete, no witnesses were called, and the Claimant was terminated before the promised investigations

Reasoning

The minutes showed the disciplinary hearing was adjourned pending further investigation, which was never carried out. The accusers did not attend the hearing, and the Claimant was not given the evidence against him. Termination followed on 7th September 2015 without a concluded process, contrary to Section 41 of the Employment Act and the requirements of a fair hearing.

p. 5
03

Unfair termination under Section 45(2) and remedies under Section 49

Holding

Termination was unfair both substantively and procedurally; compensation of 10 months' salary plus one month's notice pay was awarded

Reasoning

Applying Section 45(2), the employer failed to prove a valid and fair reason and fair procedure. Exercising discretion under Section 49, the court awarded 10 months' gross salary as compensation and one month's salary in lieu of notice, with costs and interest, notwithstanding the claim for the maximum 12 months.

p. 5

Legal principles established

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  • The employer bears the onus of proving valid reasons for termination and that a fair procedure was followed; failure on either limb renders termination unfair
  • Where an employer does not call the accusers at a disciplinary hearing or in court and produces no evidence of the alleged misconduct, it has not demonstrated a valid reason for dismissal
  • A disciplinary hearing adjourned for investigations that are never conducted, followed by termination, breaches the fair procedure required under Section 41 of the Employment Act

Court orders

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  1. 1.Declaration that the Claimant was unfairly and unlawfully terminated
  2. 2.Award of 10 months' salary as compensation for unfair and unlawful termination (10 x 51,831 = Kshs.578,310/=)
  3. 3.Award of one month's salary in lieu of notice (Kshs.57,831/=)
  4. 4.Total judgment of Kshs.636,141/= entered for the Claimant
  5. 5.Respondent to bear costs of the suit plus interest at court rates with effect from the date of judgment

Authorities

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Legislation

  • Employment ActSection 44(4)(g)
  • Employment ActSection 43
  • Employment ActSection 41
  • Employment ActSection 45(2)
  • Employment ActSection 44(1)
  • Employment ActSection 49
  • Evidence ActSection 3(4)

Cases cited (5)

  • David Gichana Omuya –v- Mombasa Maize Millers Ltd
    [2014] eKLR
  • Rebecca Ann Maina & 2 Others –v- Jomo Kenyatta University of Agriculture & Technology
    [2014] eKLR
  • Pius Machafu Isindu –v- Lavington Security Guards Limited
    [2017] eKLR
  • Principal & BOG Machakos Teachers College –v- Wambua Muange
    [2016] eKLR
  • Thomas Sila Nzivo v Bamburi Cement Limited
    [2014] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act 2007 (Sections 41, 43, 44, 45 and 49 applied)

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, "Shadrack Olindi Esikote v East African Packaging Industries Limited [2019] KEELRC 804 (KLR)", Case Analysis (2019). Not stated in the extract (Statement of Claim dated 16th October 2015). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/804/eng@2019-09-16

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