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ELRCDismissedNot stated in the judgment as provided· [2020] KEELRC 1364 (KLR)

Kenya Union of Commercial Food & Allied Workers v Isiolo Teachers Sacco Society Limited [2020] KEELRC 1364 (KLR)

Employment & Labour Relations Court
5 March 2020
2,434 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~10 min to read original · ~4 min brief

The bottom line

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Kenyan employees who skip disciplinary hearings cannot later claim unfair dismissal — the court dismissed the union's entire multi-million shilling claim.

What this practically means

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Executive summary

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The Claimant union sued the Respondent SACCO on behalf of five Grievants dismissed on 27th July 2017 following an inquiry into the SACCO's financial management and loan disbursement irregularities. The Grievants had earlier been sent on compulsory leave after a special general meeting of 21st November 2014 dissolved the board and resolved that staff be removed; after successfully challenging the compulsory leave in Nyeri ELRC Case 12 of 2015, they were placed on suspension on half salary. An inquiry report adversely mentioned them for irregular and over-loaning. Show cause letters were issued in May 2017; the Grievants collected them but none appeared before the staff advisory board, and none appealed under the code of conduct. The union reported the trade dispute to the Ministry of Labour on 12th April 2018, nearly nine months after dismissal, contrary to the Labour Relations Act's 60-day requirement. The Claimant sought half salaries, house allowance, CBA terminal benefits, untaken leave, notice pay and provident fund contributions, relying on Violet Shivachi v Selecta Kenya. The Respondent denied the CBA and entitlements and argued the Grievants owed about Kshs. 8 million in irregularly obtained loans. Applying Sections 41, 43 and 45 of the Employment Act, the court held the dismissal was for just cause and procedurally fair, the Grievants having declined the opportunity to be heard. The suit was dismissed with no order as to costs given the nature and origin of the dispute.

Key legal issues

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01

Whether the dismissal of the Grievants was fair and for just cause

Holding

The dismissal was for just cause and procedurally fair; the Grievants were issued show cause letters, failed to appear before the staff advisory board, and did not appeal under the code of conduct.

Reasoning

The court applied Sections 41, 43 and 45 of the Employment Act. The inquiry report had adversely mentioned the Grievants in relation to irregular loan disbursement. Show cause letters were issued and collected, and the Grievants were to appear with a fellow staff member or union representative, but none attended. The code of conduct provided an appeal process which none used. The employer discharged its burden of proving valid reason and fair procedure.

p. 3
02

Whether the delay in issuing show cause letters (a year after the inquiry report) rendered the process unfair

Holding

The delay did not render the termination unfair because the show cause letters still afforded the Grievants an opportunity to be heard.

Reasoning

The Claimant argued the show cause letters came a year after the April 2016 inquiry report. The court held the employer's obligation was to give the employees a chance to defend themselves, and the show cause letters constituted that opportunity. The court also noted the inconsistency of the Claimant disavowing receipt of the letters while producing them in evidence, and the union's own delay of about nine months in reporting the dispute.

p. 3
03

Whether the Grievants were entitled to the monetary reliefs claimed

Holding

The reliefs were refused as the Grievants failed to prove non-payment and their suit lacked merit.

Reasoning

The Claimant sought half salaries, house allowance, terminal benefits per the CBA, untaken leave and notice pay totalling Kshs. 13,225,879.06 plus provident fund contributions. The Respondent denied the CBA's existence and entitlement. The court found the Grievants were paid half salary during suspension, that salary was inclusive of house allowance, that no leave claim had been made, and that the Grievants in fact owed the SACCO approximately Kshs. 8 million in loans.

p. 3

Legal principles established

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  • An employer must prove the reason for termination; failure renders the termination unfair under Section 45
  • An employee who is issued show cause letters and declines to attend a disciplinary hearing cannot later complain of denial of a hearing or unfair termination
  • A union should report a trade dispute to the Ministry of Labour within 60 days under the Labour Relations Act

Court orders

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  1. 1.The Claimant's suit is dismissed
  2. 2.No order as to costs due to the nature and origin of the dispute

Authorities

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Legislation

  • Employment ActSection 41
  • Employment ActSection 43
  • Employment ActSection 45
  • Employment ActSection 45(2)
  • Labour Relations Act60-day dispute reporting requirement

Cases cited (1)

  • Violet Shivachi v Selecta Kenya-GMBH & Co. KG Limited
    [2016] eKLR
Jurisdiction invoked
Employment and labour relations dispute referred after conciliation under the Labour Relations Act; court seised under 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, "Kenya Union of Commercial Food & Allied Workers v Isiolo Teachers Sacco Society Limited [2020] KEELRC 1364 (KLR)", Case Analysis (2020). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/1364/eng@2020-03-05

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