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ELRCPartially AllowedNot stated in the judgment as provided· [2019] KEELRC 2398 (KLR)

Joseph Onyango v Gulf Energy Limited [2019] KEELRC 2398 (KLR)

Employment and Labour Relations Court
7 February 2019
2,624 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 awarded a sacked depot manager over Kshs.2.8 million because Gulf Energy could not prove why he was fired or follow its own disciplinary rules.

What this practically means

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Executive summary

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Joseph Onyango Ogutu, formerly Depot Manager at Gulf Energy Limited's Kisumu depot, sued the Respondent claiming he was summarily dismissed on 7th March 2016 on allegations of gross misconduct - namely instructing the release of a detained Topaz Network Limited truck - without warning or a fair hearing. He sought Kshs.13,184,000, aggravated damages, costs and interest. The Respondent denied unfair termination, asserting that it followed the Employment Act and its Human Resource Policy Manual, having summoned the Claimant for a disciplinary hearing and issued warnings. The court framed two issues: whether the dismissal was wrongful or unfair, and entitlement to relief. On the evidence, the court found the Respondent failed to prove that the Claimant issued the instruction to release the truck; the truck was under the Station Manager, who was not called as a witness, and the Claimant was neither copied in nor blamed in the relevant emails. Procedurally, a warning letter was issued only after the disciplinary hearing, contrary to the Respondent's own HR Policy Manual, and the requirements of Section 41 of the Employment Act were not met. Applying Section 45, the dismissal was unfair. Applying Section 49(4), the court awarded two months' salary in lieu of notice (Kshs.412,140) and 12 months' salary compensation (Kshs.2,472,840), plus costs, interest on those sums, and a certificate of service. Claims for housing, gratuity and aggravated damages were refused.

Key legal issues

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01

Whether the reason for summary dismissal (release of the Topaz truck and failure to collect the debt) was valid and proved

Holding

The Respondent failed to prove that the Claimant issued instructions to release the truck; the Station Manager who controlled the truck was not called as a witness

Reasoning

The Claimant was neither copied in nor adversely mentioned in the email exchanges between RW2 and Topaz Limited's director. The truck was under the Station Manager Stephen Odhiambo, who was not called to testify. Debt collection was not part of the Claimant's duties. The Respondent thus failed to discharge the burden of proving a valid reason for summary dismissal.

p. 3
02

Whether the disciplinary procedure complied with Section 41 of the Employment Act and the Respondent's HR Policy Manual

Holding

The procedure fell short; a warning letter was issued after the disciplinary hearing, contrary to the HR Policy Manual, and the mandatory requirements of Section 41 were not met

Reasoning

The HR Manual requires written warnings before a final warning and summary dismissal only after discussion and a final warning. Here a warning letter was issued after the hearing on the same issues, achieving nothing. Section 41 requires explanation of reasons and hearing of representations; the Manual also required prior notice of the meeting and a signed note, none of which was done.

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03

Whether the Claimant was entitled to the reliefs sought, including aggravated damages

Holding

Housing, gratuity and aggravated damages refused; notice pay and 12 months' salary compensation awarded

Reasoning

The court applied Section 49(4) factors of the Employment Act. The appointment letter did not provide for housing or gratuity, and aggravated damages were not payable on the facts. The Claimant had already been paid salary and outstanding leave per the dismissal letter. Notice pay and the maximum 12 months' compensation were awarded for the unfair dismissal.

p. 4

Legal principles established

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  • Termination is unfair where the employer fails to prove the reason for termination and fails to follow fair procedure
  • An employer must follow its own disciplinary procedure as set out in its HR Policy Manual, including the sequence of warnings before summary dismissal

Court orders

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  1. 1.2 months' salary in lieu of notice based on gross pay as per payslip for March 2016 of Kshs.412,140 as provided in the employment contract
  2. 2.12 months' salary compensation for unfair dismissal of Kshs.2,472,840
  3. 3.Costs of the suit
  4. 4.Interest on the 12 months' compensation and costs from date of judgment till payment
  5. 5.Certificate of service
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act and the Employment and Labour Relations Court Act (implied; not expressly 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, "Joseph Onyango v Gulf Energy Limited [2019] KEELRC 2398 (KLR)", Case Analysis (2019). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/2398/eng@2019-02-07

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