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ELRCDismissedNot stated in the judgment as provided· [2019] KEELRC 1032 (KLR)

Samson Omondi Onyango v Kenya Commercial Bank Limited [2019] KEELRC 1032 (KLR)

Employment and Labour Relations Court
19 July 2019
4,329 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~17 min to read original · ~4 min brief

The bottom line

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A Kenyan bank employee won on unfair procedure but lost everything because he failed to prove his monetary claims.

What this practically means

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Executive summary

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The claimant, employed by the respondent bank from 2 February 1995 and rising to Section Head at the Central Processing Centre (CPC), was terminated on grounds of gross misconduct after irregular transfers were made to his account from the accounts of a colleague, Charles Wambua, Wambua's minor son, and fellow employee Jane Ogoti. He was issued a show cause letter dated 2 February 2011, responded on 4 February 2011 admitting the transactions but explaining them as loan repayments and colleague favours, and a Disciplinary Committee recommended termination. The claimant sought withheld salary, three months' salary in lieu of notice, terminal benefits of Kshs.17,992,800 with interest and costs. The court held the respondent had a valid reason for termination: the claimant admitted authorising customer transactions at Head Office contrary to bank policy and lending money to a colleague, conduct inconsistent with the heightened integrity banks demand of staff. However, the Disciplinary Committee terminated his employment without giving him a hearing, breaching Section 41 of the Employment Act, rendering the termination procedurally unfair under Section 45(2). Despite finding unfair termination, the court dismissed the entire claim: the withheld salary was unproved; the CBA provided for and the respondent paid one month's notice; the terminal benefits claim lacked any breakdown; and no specific prayer for compensation for unfair termination was made. The claim was dismissed with no orders for costs.

Key legal issues

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01

Whether the respondent had a valid reason to terminate the claimant's employment

Holding

Yes - the claimant was guilty of authorising customer transactions at CPC (Head Office) instead of at branch level, initiating transactions against bank policy, and lending money to a colleague contrary to bank policy

Reasoning

The claimant admitted the charges in his response to the show cause letter and in his witness statement. Banks require a higher standard of integrity from staff because they handle customers' funds. The court applied the reasonable-employer test and authorities on dishonesty in banking employment, finding the conduct amounted to gross misconduct breaching the bank's security procedures.

p. 4
02

Whether the termination followed fair procedure under Section 41 of the Employment Act

Holding

No - the Disciplinary Committee decided to terminate the claimant's employment without giving him a hearing

Reasoning

Although the claimant was issued a show cause letter and responded, and was suspended and questioned by the Forensic Department, the Disciplinary Committee meeting of 14 March 2011 terminated his employment without hearing him. He testified he was only given a hearing on appeal. This breached Section 41, rendering the termination procedurally unfair under Section 45(2).

p. 5
03

Whether the claimant proved the monetary remedies sought

Holding

No - none of the prayers (withheld salary, three months' notice pay, terminal benefits) was proved despite the finding of procedural unfairness

Reasoning

The claimant produced no account statements or evidence of withheld salary; the CBA provided for and the respondent paid one month's notice; the terminal benefits claim of Kshs.17,992,800 had no breakdown. Because no specific prayer for compensation for unfair termination was made, the court could not award it despite the procedural unfairness finding.

p. 6

Legal principles established

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  • An employer bears the burden of proving both a valid reason and fair procedure for termination under Section 45(2) of the Employment Act
  • Banks demand a higher level of integrity from their staff than other occupations
  • A court determining fairness of termination ought not substitute its decision for that of the employer
  • Substantial compliance with Section 41 fair procedure means mere procedural lapses do not amount to unfair termination

Court orders

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  1. 1.The claim is dismissed
  2. 2.No orders for costs

Authorities

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Legislation

  • Employment ActSection 41
  • Employment ActSection 45(2)

Cases cited (8)

  • Samuel Kalomit Murkomen v Telkom Kenya Limited
    [2017] eKLR
  • Alfred Mutuku Muindi -vs- Rift Valley Railways (limited)
    [2015] eKLR
  • McKinley vs. B.C. Tel.
    (2001) 2 S.C.R. 161
  • Sarah Wanyaga Muchiri v Henry Kathii & another
    [2014] eKLR
  • British Leyland UK Ltd v. Swift
    [1981] IRLR 91
  • David Karume Burugu v National Bank of Kenya Ltd
    [2014] eKLR
  • Agnes Murigi Mwangi Vs Barclays Bank of Kenya Limited
    [2013] eKLR
  • Peter Kithaka Mbawa vs Coca Cola Juices Kenya Limited
    Cause No. 1956 of 2014
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act (termination of employment claim); no specific constitutional provision cited

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, "Samson Omondi Onyango v Kenya Commercial Bank Limited [2019] KEELRC 1032 (KLR)", Case Analysis (2019). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/1032/eng@2019-07-19

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