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ELRCDismissedEmployment cause (number not stated in judgment)· [2020] KEELRC 1223 (KLR)

Banking, Insurance and Finance Union (Kenya) v Kenya Commercial Bank Limited [2020] KEELRC 1223 (KLR)

Employment and Labour Relations Court
23 April 2020
MOMaureen Onyango
3,385 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~14 min to read original · ~4 min brief

The bottom line

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What this practically means

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Executive summary

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The Claimant, a registered trade union under the Labour Relations Act, 2007, sued on behalf of its member Justus Muli Nzuki, formerly a Direct Sales Representative and later micro banker at the Respondent bank, challenging the termination of his employment on 13 November 2013. The termination followed a fraud in which Kshs.2,100,000 was withdrawn from a customer's account on 5 and 6 April 2013, a day after the grievant had accessed that account while serving a customer. The Claimant sought a declaration of unfair termination, reinstatement, re-engagement, lost salaries of Kshs.1,376,320/-, twelve months' compensation of Kshs.750,720/- and costs, contending breach of Sections 43, 44 and 45 of the Employment Act, 2007, and additionally pleaded underpayment contrary to the CBA. The Respondent maintained that the grievant irregularly accessed the account without valid reason, disclosed information to fraudsters, and that a fair procedure was followed. The court framed two issues: validity of the termination procedurally and substantively, and entitlement to reliefs. It found that the grievant received a show cause letter, a disciplinary hearing with two union shop stewards, and an appeal, satisfying procedure, and that his conduct was highly suspicious — an employee of doubtful integrity cannot be retained in banking. The termination was therefore valid. All reliefs failed: the salary claim was unjust enrichment and speculative, and reinstatement was barred by the three-year limit. The Claim was dismissed in its entirety with each party bearing their own costs. Judgment delivered virtually at Nairobi on 23 April 2020 under COVID-19 directions.

Key legal issues

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01

Whether termination was procedurally and substantively valid

Holding

Valid: fair procedure was followed and there was valid reason for termination

Reasoning

The grievant was issued a show cause letter, attended a disciplinary hearing on 7 November 2013 with two union representatives, and his appeal was heard. Both parties agreed the hearing was fair. On substance, the court found the grievant's access of the customer's account highly suspicious — he could not recall why he accessed it, failed to question anomalies in the loan enquiry, and fraud of Kshs.2,100,000 followed soon after. Integrity doubts justify dismissal in banking.

p. 4
02

Whether the Claimant is entitled to the reliefs sought

Holding

Not entitled: termination valid, remedies unavailable

Reasoning

Having found no unfair termination, the declaration, reinstatement, re-engagement, lost salaries and 12 months' compensation all fail. Reinstatement was additionally barred by lapse of time (over three years since 2013 termination). The salary claim would constitute unjust enrichment and was speculative, remedies being proportionate to economic injury rather than a vehicle for unjust enrichment.

p. 5

Legal principles established

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  • The burden of proving unfair termination rests on the employee while the burden of justifying grounds for termination rests on the employer
  • A bank cannot keep an employee against whom there is doubt on integrity; suspicion of irregular account access is a valid reason for termination

Court orders

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  1. 1.The Claim is dismissed in its entirety
  2. 2.Each party shall bear their own costs

Authorities

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Legislation

  • Labour Relations Act
  • Banking Act
  • Employment Act, 2007Sections 41, 43, 44, 45, 47(5), 49(3)(b), 50
  • Industrial Court Act No. 20 of 2011Section 12(3)
  • Constitution of KenyaArticles 159(2)(d), 48
  • Civil Procedure Act (Chapter 21)Section 1B
  • Civil Procedure RulesOrder 21 Rule 1

Cases cited (9)

  • Said Ndege Vs Steel Makers Limited
    Industrial Cause No. 158 of 2013
  • East Africa Portland Cement Co. Limited Vs Kenya Chemical & Allied Workers Union
    (2017) eKLR
  • Mary Chemweno Kiptui Vs Kenya Pipeline Company Limited
    (2014) eKLR
  • Nicholas Otinyu Muruka Vs Equity Bank Limited
    (2013) eKLR
  • Loice Otieno Vs Kenya Commercial Bank Limited
    (2013) eKLR
  • Daniel Kamau Kariithi Vs Bamburi Cement
    (2016) eKLR
  • Francis Nyongesa Kweyu Vs Eldoret Water and Sanitation Company Limited
    (2017) eKLR
  • Benson N. Irungu Vs Total Kenya Limited
    (2015) eKLR
  • D. K Njagi Marete Vs. Teachers Service Commission
    Industrial Cause No 379 Of 2009
Jurisdiction invoked
Industrial Court Act / Employment and Labour Relations Court jurisdiction under Section 12 of the Industrial Court Act No. 20 of 2011 and Sections 41, 43, 44, 45, 47, 49 and 50 of the Employment Act, 2007

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 Kenya Commercial Bank Limited [2020] KEELRC 1223 (KLR)", Case Analysis (2020). Employment cause (number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/1223/eng@2020-04-23

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