Samuel Chege Kamau v Uwezo Microfinance Bank Limited [2020] KEELRC 453 (KLR)
The bottom line
#A Kenyan court ruled that a bank unfairly fired its finance manager because it never gave him a hearing or proved its fraud claims.
What this practically means
#Executive summary
#Key legal issues
#Whether the Respondent had valid reasons for summary dismissal
The Respondent failed to prove the alleged fraud and poor performance; dismissal was without valid reasons
The Respondent relied on an internal audit report that was neither explained nor dated. Its witness could not identify the files or documents allegedly stolen, the customers allegedly colluded with, or the amounts of cash allegedly collected and not remitted. No evidence of poor performance against expected output was adduced. Under Section 43 of the Employment Act, the employer must prove the reasons for termination, failing which the termination is deemed unfair under Section 45.
Whether the Respondent followed due process before dismissal
The Respondent failed to comply with Section 41 of the Employment Act; the dismissal was procedurally unfair
The Claimant was not issued a show cause letter or written notice of the accusations, and was only invited orally to a meeting. Section 41 requires an employer, before terminating on grounds of misconduct or poor performance, to explain the reasons to the employee and to hear and consider any representations. The police investigation is independent of the employer's internal disciplinary process and does not substitute for it. Condemning the Claimant unheard violated this mandatory requirement.
Remedies for unfair termination
Claimant awarded notice pay, unpaid July salary, untaken leave pay and 7 months' salary compensation
Having found the dismissal unfair and unjustified, the Court applied Section 49 principles, awarding one month's salary in lieu of notice, 12 days' unpaid July salary, pay for 40 untaken leave days, and seven months' salary as compensation for the denial of an opportunity to be heard, subject to statutory deductions, plus unfreezing of the bank account, a certificate of service, costs and interest.
Legal principles established
#- An employer bears the burden of proving the reason or reasons for termination; failure to do so renders the termination unfair
- An employee's arrest by police on an employer's report does not excuse the employer from according the employee a disciplinary hearing under Section 41 of the Employment Act
Court orders
#- 1.1 month salary in lieu of notice of Kshs. 75,000
- 2.Salary not paid in July 2016 for 12 days of Kshs. 30,000
- 3.Pay in respect of 40 days leave not taken of Kshs. 100,000
- 4.Compensation of 7 months' salary (Kshs. 525,000) for unlawful and unfair termination
- 5.Total award of Kshs. 730,000 less statutory deductions
- 6.Unfreezing of the Claimant's bank account No. 001205000001
- 7.Issuance of a certificate of service
- 8.Costs and interest at Court rates with effect from the date of the judgment
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under Article 162(2) of the Constitution (employment and labour relations dispute; no specific provision quoted in judgment)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Samuel Chege Kamau v Uwezo Microfinance Bank Limited [2020] KEELRC 453 (KLR)", Case Analysis (2020). Cause No. 2584 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/453/eng@2020-09-16
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.