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ELRCDismissedMemorandum of Claim filed 4th March, 2011· [2019] KEELRC 863 (KLR)

Mutegi Matembo Jacob v Kenya Commercial Bank Ltd [2019] KEELRC 863 (KLR)

Industrial Court (Employment and Labour Relations Court)
20 September 2019
ANAbuodha J. N.
1,483 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 upheld a bank employee's dismissal because the employer genuinely believed he enabled fraud and followed fair procedure before terminating him.

What this practically means

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Executive summary

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The Claimant, a bank employee employed in 1997 and earning Kshs. 83,381 inclusive of house allowance, sued for wrongful and unlawful termination following the dismissal of his services on 25th June 2008. The Respondent alleged that a customer, Maria Wambua, lost Kshs. 1,200,000 through fraudulent ATM withdrawals after the Claimant authorised issuance of a replacement ATM card without disabling the existing card and released the pin mailer to a fraudster whose signature differed from bank records; the Claimant also accessed the customer's account severally without cause. The Claimant denied wrongdoing, claiming he verified the application, identity card and signature, that the account was to be kept open to trap the fraudster, and that his account access was for marketing purposes. He attempted to resign during investigations but the Respondent refused the resignation and terminated him for loss of confidence after paying terminal dues. The court held that the reasons for termination were those the employer genuinely believed to exist; the Claimant did not deny issuing the second card or accessing the account, and failed to convincingly explain the lapse. A prudent bank would not leave an account open under fraudulent attack. On procedure, the Claimant admitted receiving and answering a show cause letter and appearing before a disciplinary committee, satisfying the court the process was fair. The claim was found without merit and dismissed with costs. Judgment was delivered at Nairobi on 20th September 2019 by Abuodha J. N.

Key legal issues

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01

Validity of the reasons for termination

Holding

The reasons were valid and reasonable; the Claimant could not explain failure to detect the existing ATM card, and no prudent bank would leave a fraud-attacked account open.

Reasoning

The Claimant did not deny issuing a second ATM card nor repeatedly accessing the customer's account before the fraudulent issuance. His explanations - verification of documents and marketing access - were unconvincing. The court held the allegations were serious, that a prudent bank would freeze an account under fraudulent attack, and therefore the employer's genuine belief in the misconduct justified termination.

p. 2
02

Fairness of the termination procedure

Holding

The procedure was fair: the Claimant was issued a show cause letter, responded to it, and appeared before a disciplinary committee.

Reasoning

The Claimant admitted receiving a show cause letter to which he responded, and admitted appearing before the respondent's disciplinary committee. On those admissions the court was satisfied the process preceding termination was fair, and the procedural limb of the challenge failed.

p. 2

Legal principles established

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  • The reasons for termination are those which the employer genuinely believed to exist and which caused the termination

Court orders

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  1. 1.The claim is dismissed
  2. 2.The Claimant to pay the costs of the suit
Jurisdiction invoked
Employment and labour relations jurisdiction over a wrongful and unlawful termination claim (Industrial Court)

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, "Mutegi Matembo Jacob v Kenya Commercial Bank Ltd [2019] KEELRC 863 (KLR)", Case Analysis (2019). Memorandum of Claim filed 4th March, 2011. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/863/eng@2019-09-20

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