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ELRCDismissedCause No 1578 of 2013· [2019] KEELRC 1809 (KLR)

Banking Insurance and Finance Union (Kenya) v Barclays Bank of Kenya [2019] KEELRC 1809 (KLR)

Employment and Labour Relations Court of Kenya
1 March 2019
ANAbuodha Jorum Nelson
2,643 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~11 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ruled that employees who sign performance contracts with agreed targets can be lawfully fired for repeatedly missing them, if proper warnings and hearings happened.

What this practically means

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Executive summary

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The Banking Insurance and Finance Union (Kenya) sued Barclays Bank of Kenya on behalf of two grievants, Peter Mathuku and Francis Ndirangu Wachira, claiming that the bank's 2008 issuance of fresh letters of appointment revising terms and conditions was arbitrary and done without consultation with the union. The revised contracts introduced a Performance Development Plan (PDP) under which continued employment depended on good performance, and clause 6 entitled the bank to terminate for poor performance. The union argued the PDP was an internal arrangement never negotiated into the CBA and that terminations for failing PDP targets were unlawful. Both grievants had been rated 'D' (does not meet expectations) over successive years, agreed with their assessments, attended multiple disciplinary and capability hearings, and received warnings before their services were terminated in May 2013. The respondent contended the PDP was a global Barclays Group standard applied after due consultation with all stakeholders including the union. The court held that the grievants were bound by the PDP as a term of their contracts, having signed the revised letters and set their own targets, and found no evidence that the union had contested the PDP's application to its members until the terminations. Satisfied that valid reason existed for the terminations and that due process, including hearings and warnings, was followed, the court dismissed the claim with no order as to costs.

Key legal issues

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01

Whether the 2008 revised contracts and PDP were introduced without consultation with the union

Holding

The claimant failed to prove lack of consultation; the grievants signed the new terms and the union raised no objection to the application of PDP until the terminations

Reasoning

The respondent's evidence was that the revised contracts were offered after consultation with all stakeholders including the union, and the PDP was a global Barclays Group standard applying to all employees. The grievants signed the contracts and set their own PDP targets with their line managers. The court found the dispute only arose after termination, and no evidence showed the union contested PDP's application to its members.

p. 3
02

Whether the terminations for poor performance were fair and lawful

Holding

The terminations were lawful: there was valid reason (sustained 'D' ratings for not meeting expectations) and due process was followed through appraisals, warnings and hearings

Reasoning

Both grievants were rated 'D' over several years, agreed with their assessments, were invited to and attended disciplinary and capability hearings, and were informed of their right to be accompanied by a colleague or union representative. Warnings were issued after each hearing. The court found no complaint over the process and was satisfied the process was fair.

p. 4

Legal principles established

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  • A term of the contract of employment signed by the employee, including a performance development plan, binds the employee, and failure to meet targets the employee helped set constitutes a valid reason for termination
  • An employer may lawfully terminate employment for poor performance where the employee was appraised, given targets, warned and taken through disciplinary and capability hearings

Court orders

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  1. 1.The claim is dismissed as without merit
  2. 2.No order as to costs
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over a trade dispute referred to the Ministry of Labour and conciliated under the Labour Relations Act

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, "Banking Insurance and Finance Union (Kenya) v Barclays Bank of Kenya [2019] KEELRC 1809 (KLR)", Case Analysis (2019). Cause No 1578 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/1809/eng@2019-03-01

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