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ELRCPartially AllowedCause No. 68 of 2015· [2022] KEELRC 301 (KLR)

Mohamed Ali Wafula v Phoenix of East Africa Assurance Company Limited [2022] KEELRC 301 (KLR)

Employment and Labour Relations Court
21 April 2022
2,950 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 ruled that an employee who skipped his disciplinary hearing lost his right to claim unfair termination, but still got his unpaid salary and leave dues.

What this practically means

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Executive summary

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The claimant, employed by the respondent from 1990 and rising to Assistant Office Branch Operations and Administration Manager at the Eldoret Branch, sued for unfair termination following an internal audit which allegedly uncovered a loss of Kshs 100,627 in unbanked premiums. He was arrested at the respondent's Nairobi head office on 29th April 2013, charged with stealing, later acquitted under section 210 of the Criminal Procedure Code on 5th May 2016, and was served with a show cause/suspension letter and invitation to a disciplinary hearing which he did not attend, citing the pending criminal case. His services were terminated and he claimed terminal dues of Kshs 1,390,485.16, including notice pay, leave allowance, medical allowance and 12 months' compensation, though he admitted receiving Kshs 1,082,595 and Kshs 500,021 from the respondent. The respondent maintained the termination was fair, that the claimant ignored five invitations to disciplinary hearings, and that he refused to collect his dues. Relying on the waiver principle, the court held the claimant squandered his opportunity to be heard and found the termination fair and justified, dismissing the unfair termination claim. However, the court awarded the claimant his admitted unpaid April 2013 salary of Kshs 55,427.40 and unpaid leave of Kshs 40,646.76, totalling Kshs 90,074 less statutory deductions, with no notice pay or compensation. Each party was ordered to bear its own costs. Judgment was delivered virtually on 21st April 2022.

Key legal issues

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01

Procedural fairness of the termination

Holding

The termination was procedurally fair because the claimant was invited to disciplinary hearings but deliberately failed to attend, waiving his right to be heard

Reasoning

The court found the claimant was issued a show cause/suspension letter and a letter inviting him to a disciplinary committee on 24th May 2013. Cross-examination established that he collected the invitation letters while on bail prosecuting the criminal case but chose not to attend. Relying on the waiver principle, the court held he squandered his opportunity to be heard, leaving the respondent with no option but to terminate.

p. 4
02

Substantive justification for the termination

Holding

Despite questions over whether the claimant handled cash, the termination was substantively justified

Reasoning

The respondent's audit allegedly uncovered a loss of Kshs 100,627 in unbanked premiums. The claimant denied handling cash, saying the branch manager issued receipts, but the court held that even if his denial were true, he was still expected to appear before the disciplinary committee and exonerate himself. His absence meant the respondent could act on the available grounds.

p. 4
03

Entitlement to terminal dues

Holding

The claimant was entitled only to his April 2013 salary and unpaid leave, not notice pay or compensation

Reasoning

The respondent admitted the April 2013 salary was unpaid, and unpaid leave of Kshs 40,646.76 was awarded as prayed. Because the dismissal was summary and occasioned by the claimant's own failure to attend the disciplinary hearing, no notice pay or the 12 months' compensation sought was payable. The awards were subjected to statutory deductions.

p. 4

Legal principles established

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  • For a termination to pass the fairness test there must be both substantive justification and procedural fairness
  • An employee who squanders the opportunity to be heard at a disciplinary hearing cannot later claim procedural unfairness
  • The right to be heard can be waived by conduct

Court orders

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  1. 1.Payment of the claimant's April 2013 salary of Kshs 55,427.40
  2. 2.Payment of unpaid leave of Kshs 40,646.76
  3. 3.Total award of Kshs 90,074 less statutory deductions
  4. 4.Each party to bear its own costs

Authorities

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Legislation

  • Employment Actsection 41
  • Employment Actsection 43
  • Employment Actsection 44[4][g]
  • Employment Actsection 44[4][c]
  • Criminal Procedure Codesection 210

Cases cited (4)

  • Janet Nyadiko v Kenya Commercial Bank Limited
    [2017] eKLR
  • Walter Ogal Anuro v Smart Chip Dynamics Limited
    [2017] eKLR
  • Thomas Sila Nzivo v Bamburi Cement Limited
    [2014] eKLR
  • Pandya Memorial Hospital v Geeta Joshi
    [2020] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment and Labour Relations Court Act (Employment Act dispute)

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, "Mohamed Ali Wafula v Phoenix of East Africa Assurance Company Limited [2022] KEELRC 301 (KLR)", Case Analysis (2022). Cause No. 68 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/301/eng@2022-04-21

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