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ELRCDismissedMemorandum of Claim dated 21st August, 2020· [2022] KEELRC 1128 (KLR)

Kenya Union of Commercial Food and Allied Workers v Eco-Pillar Sacco Society Limited (Cause 52 of 2020) [2022] KEELRC 1128 (KLR)

Employment and Labour Relations Court
8 July 2022
2,327 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court ruled that employees who admit theft, refund the money and apologise cannot later claim they were unfairly dismissed.

What this practically means

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Executive summary

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The claimant union filed a memorandum of claim dated 21st August, 2020 on behalf of two grievants, Peter Merphus (a teller) and Anthony P. Toome (a loans/recovery clerk), employed by the respondent, a society/co-operative. The grievants were accused in early 2018 of fraudulent transactions on members' accounts amounting to approximately Kshs.340,000, placed on compulsory leave, and — as they alleged — pressured by the Board chairman and the accountant to take salary advances, refund the money, and write apology letters in a dictated format. They were suspended again in June 2018 and summarily dismissed on 24th September, 2018 citing a Board decision of 22nd September, 2018. After an unresolved conciliation under section 62 of the Labour Relations Act, the union sought reinstatement, or alternatively re-engagement or compensation for unfair termination. The respondent maintained that the grievants admitted the fraud, refunded the money, and were summarily dismissed for gross misconduct under clause 15.6(g) of its terms and conditions of service. The Court held that under section 47(5) of the Employment Act the burden lay on the employer to prove the reason for termination and on the employees to prove unfairness. Applying the concept of undue influence, it found no coercion: the grievants had opportunity to refuse the chairman's advice, involve their union, or recant during the four months before dismissal. Having admitted the accusation, refunded the loss and apologised, they could not claim unfair termination. Theft was held a valid ground for summary dismissal. The claim was dismissed with costs on 8th July, 2022.

Key legal issues

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01

Whether the grievants' admissions and refunds were coerced

Holding

No coercion or undue influence was established; the grievants could have refused the chairman's advice or sought their union's intervention but did not

Reasoning

The Court applied the Black's Law Dictionary definition of undue influence and found the grievants had the free will and opportunity to refuse the chairman's advice, to seek their union's help, or to recant their admission during the four-month period before dismissal. Their conduct — taking salary advances, refunding the money, and writing apology letters — pointed to voluntary admission rather than coercion.

p. 4
02

Whether the summary dismissal was justified

Holding

Yes — theft/fraud is a valid ground for summary dismissal and the grievants admitted it and made good the loss

Reasoning

The respondent accused the grievants of colluding to defraud the Society of Ksh.340,800 through fraudulent transactions on members' accounts. The grievants admitted the accusation, refunded the money and tendered apology letters. Given the admission and the requirement of integrity in their positions, the summary dismissal under clause 15.6(g) of the terms and conditions of service was justified.

p. 5
03

Entitlement to reinstatement, re-engagement or compensation

Holding

None; the claim of unfair termination fails

Reasoning

Having found the dismissal justified, no relief was due. The Court also noted the respondent's position that reinstatement was unavailable because the positions required integrity and trust that had been lost, and the grievants had prior disciplinary records.

p. 5

Legal principles established

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  • Under section 47(5) of the Employment Act the burden of proving unfair termination rests with the employee, while the burden of proving the reason for termination rests with the employer
  • Theft is a valid ground for summary dismissal, and an employee who admits the misconduct, refunds the loss and apologises cannot later claim unfair termination

Court orders

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  1. 1.The claim is dismissed with costs
  2. 2.It is so ordered

Authorities

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Legislation

  • Labour Relations Actsection 62
  • Employment Actsection 47(5)
Jurisdiction invoked
First-instance jurisdiction of the Employment and Labour Relations Court over a union employment dispute referred after conciliation under section 62 of the Labour Relations Act

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 and Allied Workers v Eco-Pillar Sacco Society Limited (Cause 52 of 2020) [2022] KEELRC 1128 (KLR)", Case Analysis (2022). Memorandum of Claim dated 21st August, 2020. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/1128/eng@2022-07-08

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