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ELRCDismissedCause No 511 of 2017· [2021] KEELRC 541 (KLR)

Wilson Mutabari Mworia v Barclays Bank of Kenya Limited [2021] KEELRC 541 (KLR)

Employment and Labour Relations Court
5 November 2021
SRStella Rutto
5,007 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 upheld a bank employee's sacking for skipping fraud-prevention steps, ruling the dismissal was both justified and fair.

What this practically means

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Executive summary

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The claimant, employed by the respondent bank for about 14 years and rising to Branch Coordinator, challenged the termination of his employment following two fraudulent outward swift transfers of USD 15,000 and USD 12,000 (9th and 16th August 2016) from a non-resident customer's account, which he authorised after confirming instructions by email when the customer was unreachable by phone. The respondent asserted he breached its Standard Operating Procedures, particularly the segregation of duties and the mandatory call back requirement, resulting in a loss of Kshs 1,144,700. The claimant contended he acted on a customer indemnity and was denied the investigation report, compromising his defence. The court framed three issues: justifiable cause, procedural fairness, and entitlement to reliefs. On the first, it found the claimant performed two consecutive steps contrary to the SOP, relied on a general email/facsimile indemnity that did not cover call backs, failed to undertake identity verification, and did not escalate or hold the transaction despite the colossal sum involved; his experience raised the expected standard of care, establishing negligence. On procedure, the court distinguished Ol Pejeta Ranching, holding that the test is whether the employee was sufficiently informed of specific allegations; here the allegations remained consistent, the claimant was heard at investigation, disciplinary hearing, show cause stage and appeal, and suffered no prejudice from non-supply of the report. The claim was dismissed in its entirety with no orders as to costs.

Key legal issues

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01

Whether there was justifiable cause to terminate the claimant's services

Holding

Yes - the claimant was negligent in processing funds transfers contrary to the bank's SOP, giving the respondent a valid and fair reason

Reasoning

The claimant received transfer instructions and personally attempted the call back, performing two consecutive steps prohibited by the segregation-of-duties SOP. He relied on a general email/facsimile indemnity rather than the specific call back indemnity required, failed to undertake identity verification procedures, failed to escalate or hold the transaction when the client was unreachable, and the fraud caused a loss. Given his 14 years' experience, a high degree of care was expected. The respondent therefore discharged its burden under sections 43(1) and 45(2) of the Employment Act.

p. 5
02

Whether the claimant was accorded procedural fairness

Holding

Yes - the allegations were specific, consistent throughout, and the claimant was heard at investigation, disciplinary hearing, show cause stage and appeal

Reasoning

The claimant was notified of the specific allegations, attended a disciplinary hearing accompanied by a colleague, was invited to show cause, and was granted an appeal before a different panel. The test is whether the employee was sufficiently informed of the allegations; the investigation report was not necessary where the allegations were detailed and consistent. The claimant failed to demonstrate prejudice from non-supply of the report and did not respond to the show cause letter.

p. 6
03

Whether the claimant is entitled to the reliefs sought

Holding

No - having failed on both substantive and procedural fairness, he is entitled to nothing

Reasoning

The court found the termination was substantively justified and procedurally fair; consequently all reliefs sought - declarations of unfairness, pecuniary loss, constitutional and general damages - fell away and the claim was dismissed in its entirety with no orders as to costs.

p. 6

Legal principles established

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  • An employer must prove that the reason for termination is valid and fair, determined case by case
  • The fairness of a disciplinary process is tested by the sufficiency and detail of the allegations against the employee, not by supply of the investigation report
  • Bank staff must observe a high degree of integrity and prudence with customer funds, failing which they risk termination

Court orders

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  1. 1.The claim is dismissed in its entirety
  2. 2.No orders as to costs

Authorities

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Legislation

  • Employment Actsection 41
  • Employment Actsection 42(1)
  • Employment Actsection 43(1)
  • Employment Actsection 43(2)
  • Employment Actsection 45(2)
  • Employment Actsection 45(2)(c)
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B
  • Constitution of KenyaArticle 159(2)(d)
  • Constitution of KenyaArticle 48

Cases cited (5)

  • Ol Pejeta Ranching Limited vs David Wanjau Muhoro
    (2017) eKLR
  • Kahara Mbugua vs National Industrial Training Authority
    (2020) eKLR
  • National Bank of Kenya vs Samuel Mutonya
    CA No. 118 of 2017
  • Kenya Plantation & Agricultural Workers Union vs Sotik Highlands Tea Estate Limited
    (2016) eKLR
  • Violet Kadala Shitsukane v Kenya Post Savings Bank
    Nairobi Civil Appeal No. 295 of 2016
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act (unfair termination claim)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (5)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Wilson Mutabari Mworia v Barclays Bank of Kenya Limited [2021] KEELRC 541 (KLR)", Case Analysis (2021). Cause No 511 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2021/541/eng@2021-11-05

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