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ELRCPartially AllowedCause No 23 of 2020· [2023] KEELRC 1098 (KLR)

Mainye & 2 others v Mega Pack (K) Limited (Cause 23 of 2020) [2023] KEELRC 1098 (KLR)

Employment and Labour Relations Court
4 May 2023
6,644 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~27 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled an employer unfairly dismissed a worker over theft suspicions without evidence, awarding him over Kshs. 377,000.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent as head of product development and origination from 18th March 2019, was arrested in October 2019 and charged with stealing by servant and handling stolen property after goods stolen from the Respondent were traced to the premises of Landmark Packaging, an entity the Respondent wrongly assumed he owned or directed. After two show-cause letters and two disciplinary hearings, he was dismissed on 25th November 2019 on three charges: suspected criminal offence against the employer's property, absenteeism, and insubordination. The criminal charges were later withdrawn following an agreement between the Respondent and Landmark Packaging's proprietors. The court held that the Respondent had no evidence connecting the Claimant to Landmark Packaging or the theft, and had failed to demonstrate reasonable and sufficient grounds for the suspicion, failing substantive fairness under Sections 43, 44 and 45 of the Employment Act. Procedurally, the hearing was unfair: no notice of the right to accompaniment, no disclosure of documents, no evidence or witnesses presented, and less than 24 hours to respond to each letter. The declaration of wrongful, unfair and unlawful dismissal was granted. However, the malicious prosecution and defamation-related claims failed because the Respondent lacked power to arrest or prosecute and the DCI, NPS, DPP and AG were not joined. The court awarded one month's pay in lieu of notice (Kshs.62,994.70), four months' compensation (Kshs.251,979), and November 2019 salary (Kshs.62,994.70), totalling Kshs.377,968.40, with leave, severance and service pay claims denied for lack of nexus to the contract sued upon. Costs were awarded to the Claimant.

Key legal issues

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01

Whether the dismissal was substantively fair

Holding

The dismissal was substantively unfair; the Respondent had no reasonable and sufficient grounds to suspect the Claimant of theft or handling stolen property, and the charges of absenteeism and insubordination had no substance

Reasoning

The Respondent had no evidence connecting the Claimant to Landmark Packaging or to the theft. Under Section 44(4)(g), suspicion must rest on reasonable and sufficient grounds, a burden the Respondent failed to discharge. The Claimant's absence from work was caused by the Respondent denying him access after his release from custody, and his lawyer's response to the show-cause letter was not insubordination.

p. 9
02

Whether the disciplinary process was procedurally fair

Holding

The process was procedurally unfair: no notice of the right to a union official or co-worker, no disclosure of documents required, no evidence or witnesses presented, and less than 24 hours to respond to each show-cause letter

Reasoning

The show-cause letters did not inform the Claimant of his rights or the documents required. At the hearing he was ambushed with demands to produce documents proving a negative, no witnesses were called, and the employer gave less than 24 hours to respond to each letter. These failings denied the Claimant the fair hearing guaranteed by Article 47 and Sections 41 and 45 of the Employment Act.

p. 10
03

Whether the Respondent was liable for malicious prosecution and related torts

Holding

The claim failed because the Respondent lacked power to arrest or prosecute and the constitutionally mandated agencies (DCI, NPS, DPP, AG) were not joined

Reasoning

Once a theft report was made, investigation and prosecution were the constitutional mandates of the DCI/NPS and the DPP under Article 157. The Respondent only made a report of an actual theft; it did not itself arrest, detain or prosecute. Since the agencies responsible were not parties, the malicious prosecution claim could not succeed against the Respondent.

p. 11

Legal principles established

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  • An employer alleging summary dismissal on suspicion of a criminal offence bears the burden of showing the suspicion was based on reasonable and sufficient grounds
  • The employer, not the employee, bears the obligation to prove the charges at a disciplinary hearing
  • Fair dismissal requires both a valid reason (substantive fairness) and a fair procedure including notice, disclosure of charges and evidence, and an opportunity to be heard

Court orders

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  1. 1.A declaration be and is hereby issued that the dismissal of the Claimant by the Respondent was wrongful, unfair, and lawful
  2. 2.Award of one month's salary in lieu of notice of Kshs. 62,994.70
  3. 3.Award of compensation for wrongful, unfair, and unlawful dismissal of Kshs. 251,979.00
  4. 4.Award of salary for November, 2019 of Kshs. 62,994.70 (total award Kshs. 377,968.40)
  5. 5.All the other claims denied and dismissed
  6. 6.The Claimant awarded costs of the cause

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 47
  • Constitution of Kenya, 2010Article 157
  • Employment Act, 2007Sections 35, 40, 41, 43, 44, 45, 46, 47, 47(5), 49(4), 90
  • Fair Administrative Action ActVarious provisions (not specified)
  • Office of the Director of Public Prosecutions ActNot specified
  • National Police Service ActNot specified

Cases cited (3)

  • Mary Chemweno V Kenya Pipeline Company Limited
    (2017) eKLR
  • Loice Otieno V Kenya Commercial Bank Limited
    (2013) eKLR
  • Walter Ogal Anuro V Teachers Service Commission
    (2012) eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act and Article 47 of the Constitution (fair labour practices); exact constitutional article of jurisdiction not stated

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, "Mainye & 2 others v Mega Pack (K) Limited (Cause 23 of 2020) [2023] KEELRC 1098 (KLR)", Case Analysis (2023). Cause No 23 of 2020. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/1098/eng@2023-05-04

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