Madagow & another v African Banking Corporation Ltd (Cause 424 & 425 of 2015) [2020] KEELRC 22 (KLR)
The bottom line
#Kenya's Employment Court ruled one bank employee's dismissal unfair because her employer couldn't prove she did anything wrong, awarding six months' salary.
What this practically means
#Executive summary
#Key legal issues
#Whether there was a valid reason for dismissing the 1st claimant
No - the charges were not made out; she had notified her supervisor and the verifier by email and all officers had system alerts on the used cheque.
The email trail showed the 1st claimant sent the cheque to the domicile branch, was confirmed for payment by Ms. Magut, and forwarded it to the CBO (Ms. Costa), copying the 2nd claimant, who admitted she had told him the cheque had been used. Since the supervisor admitted being informed and the verifier had system access, the first charge (failure to inform) failed, and with it the second charge of misrepresentation fell away.
Whether there was a valid reason for dismissing the 2nd claimant
Yes - he negligently authorised the transaction and was rightly dismissed under s. 44(4).
As the 1st claimant's supervisor, he was told the cheque had previously been presented and honoured, yet he advised her to treat it as a Debit Voucher. The court believed Cw1's account and found he was the right person to stop the fraudulent transaction at branch level and escalate to senior managers. His negligence occasioned the loss of Kshs. 1,950,000, proving a valid reason on a balance of probability.
Whether a fair procedure under s. 41 was followed
Yes - both claimants were served with show cause letters, attended hearings, and were effectively recorded as admitting a fair hearing.
The claimants admitted receiving show cause letters and attending hearings with a fellow employee of their choice. Though they complained the notice was short, they never protested in writing or sought adjournment. When proceedings were withdrawn and fresh hearings scheduled, they objected through counsel rather than attend, which the court treated as an admission that the initial process was fair.
Legal principles established
#- Failure by an employer to prove a valid reason for dismissal renders the termination unfair under ss. 43 and 45 of the Employment Act.
- Under s. 41 of the Employment Act, an employer must accord a fair hearing to an employee before termination on account of misconduct.
Court orders
#- 1.1st Claimant: compensation of Kshs. 222,000 (6 months' gross salary at Kshs. 37,000) for unfair dismissal, subject to statutory deductions
- 2.1st Claimant: Certificate of Service
- 3.1st Claimant: costs plus interest at court rates from the date of judgment
- 4.2nd Claimant: Certificate of Service
- 5.2nd Claimant: no order as to costs
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act (ss. 41, 43, 44(4), 45, 49, 51) and ELRC Procedure Rules
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Madagow & another v African Banking Corporation Ltd (Cause 424 & 425 of 2015) [2020] KEELRC 22 (KLR)", Case Analysis (2020). Consolidated suits instituted on 19.3.2015 and consolidated on 31.5.2018 (ELRC, Nairobi). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/22/eng@2020-12-17
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.