Kenneth Wanjohi Kareithi v Olympia Capital Holdings Limited [2019] KEELRC 1590 (KLR)
The bottom line
#A Kenyan court ruled a CEO's mutual separation was fair, but ordered his employer to refund money docked from his final dues.
What this practically means
#Executive summary
#Key legal issues
#Existence of a contract of service with the respondent
The claimant was employed by the respondent by the letter dated 04.09.2013, having previously served on secondment while CEO of Mather and Platt Kenya Limited
The Court examined the appointment letters and salary arrangement under which Mather and Platt Kenya Limited paid Kshs.500,000 and the respondent topped up Kshs.200,000. It found that following the claimant's resignation from the subsidiary, the respondent appointed him full-time CEO at Kshs.700,000, establishing a contract of service.
Whether the termination was unfair or unlawful
The termination was by mutual agreement arising from a restructuring and strategic differences, and was not unfair
The respondent's letter of 04.12.2013 described a mutual separation following Group HR restructuring with no disciplinary case. The claimant never objected until filing suit, and all prior correspondence concerned computation of dues. RW confirmed board involvement and agreement to separate on strategic grounds.
The respondent's counterclaim for Kshs.233,750 paid to Forbes Africa Magazine
The counterclaim failed; the advertisement was lawfully undertaken within the claimant's duties and the respondent benefited from it
The respondent did not file the procurement rules allegedly breached, did not exhibit the approved budget, gave no particulars of breach, and initiated no disciplinary proceedings. The advertisement was published and benefited the respondent, falling within the claimant's duty to market the company's products and good name.
Legal principles established
#- Termination effected by mutual agreement between employer and employee is not unfair or unlawful termination
- A party alleging breach of procurement rules must exhibit the rules and the budget allegedly breached and prove particulars of the breach
Court orders
#- 1.The respondent to pay the claimant a sum of Kshs.233,750.00 by 01.07.2019 failing which interest at Court rates from the date of filing the suit till full payment
- 2.The counterclaim is dismissed
- 3.The respondent to pay costs of the claimant's claim and counterclaim
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act and the Labour Relations Act (not expressly quoted in the excerpt)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenneth Wanjohi Kareithi v Olympia Capital Holdings Limited [2019] KEELRC 1590 (KLR)", Case Analysis (2019). Cause No 268 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/1590/eng@2019-05-24
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.