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ELRCPartially AllowedELRC No. 721 of 2015· [2019] KEELRC 1232 (KLR)

Felix Mutiso v Beiertsdof East Africa Limited [2019] KEELRC 1232 (KLR)

Employment and Labour Relations Court
1 July 2019
HWHellen S. Wasilwa
2,773 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Beiersdorf East Africa was ordered to pay a former warehouse manager 10 months' salary after a Kenyan court found his dismissal unfair and procedurally flawed.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent from 1st June 2005 and rising to Warehouse Manager, challenged the termination of his employment on 30th September 2014 following stock losses of approximately KShs. 4.9 million. He sought a declaration that the termination was unfair, 12 months' salary as compensation, interest and costs. The Respondent maintained that the termination followed due procedure and was justified by the Claimant's negligence and failure to deliver his duties as the person responsible for inventory custody and movement. The Claimant relied on authority holding that once unfair termination is alleged, the burden shifts to the employer to justify the reasons; the Respondent relied on authorities on procedure and admissibility of evidence. The Court framed three issues: validity of reasons, due process, and remedies. On reasons, applying section 43 of the Employment Act, the Court found the Respondent failed to demonstrate the specific commission or omission by the Claimant that caused the losses, and the audit report and disciplinary minutes were not adduced in evidentiary detail. On procedure, under section 41, the chronology - release of provident benefits before the disciplinary hearing, and invitation to hearing, hearing and dismissal all on the same day - revealed a pre-determined decision. The Court found the termination unjustifiable and unprocedural and awarded 10 months' salary as compensation, with costs and interest at court rates from the date of judgment. Claims for a 6 months' salary insurance benefit and overtime failed for want of evidence.

Key legal issues

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01

Whether there were valid reasons to warrant the dismissal of the Claimant

Holding

There were no valid reasons; the Respondent failed to prove the reasons for termination

Reasoning

Under section 43 of the Employment Act, the employer must prove the reasons for termination. The Respondent only showed that the Claimant was the Team Leader but did not demonstrate the specific commission or omission attributable to him that led to the losses. The disciplinary minutes lacked detail, and no audit reports or evidence of variance in stock taking were adduced.

p. 5
02

Whether the Claimant was accorded due process before termination

Holding

The Claimant was terminated without due process

Reasoning

The chronology showed a pre-determined decision: provident benefits were released before the disciplinary hearing, and the Claimant was invited to a hearing on 29/9/2014 and dismissed the same day. The minutes did not record the questions and answers. This fell short of the process envisaged under section 41 of the Employment Act.

p. 5
03

What remedies should be awarded

Holding

Ten months' salary as compensation, plus costs and interest

Reasoning

Having found the termination unjustifiable and unprocedural, the Court exercised its discretion under the Employment Act to award 10 months' salary (KShs. 1,282,000 computed as 10 x 128,200) less statutory deductions, with costs and interest at court rates. Other heads of claim failed for want of evidence.

p. 6

Legal principles established

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  • The employer bears the burden of proving the reasons for termination, failing which the termination is unfair
  • An employer must, before termination, explain the reasons to the employee and hear and consider their representations under section 41 of the Employment Act

Court orders

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  1. 1.Award of 10 months' salary as compensation for unfair and unprocedural termination (10 x 128,200 = KShs. 1,228,200) less statutory deductions
  2. 2.Respondent to pay costs of the suit
  3. 3.Interest on costs at court rates from the date of judgment

Authorities

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Legislation

  • Employment ActSection 43
  • Employment ActSection 41
  • Evidence ActSection 33(b)

Cases cited (7)

  • Walter Ogal Anuro vs. Teacher Service Commission
    [2013] eKLR
  • Christopher Omutubachi vs. Metallic Crowns Limited
    [2019] eKLR
  • Grace Gacheri Muriithi vs. Kenya Literature Bureau
    [2012] eKLR
  • Makena vs. Explico Insurance Company Limited
    [2019] eKLR
  • Judicial Service Commission vs. Gladys Boss Shollei & Another
    [2014] eKLR
  • Caudle vs. Louisville Sales & Service Inc.
    1999 SKQB 276
  • Davis vs. Unemployment Insurance Review Board of the Indiana Department of Workforce Development
    900 ne 2d 488 [2009]
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under Article 162(2) of the Constitution (as inferred; not expressly cited in judgment)

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, "Felix Mutiso v Beiertsdof East Africa Limited [2019] KEELRC 1232 (KLR)", Case Analysis (2019). ELRC No. 721 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/1232/eng@2019-07-01

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