Kabaru v Craft Silicon Limited (Cause 83 of 2019) [2023] KEELRC 1584 (KLR)
The bottom line
#Even when an employer has a valid reason to fire you, skipping the disciplinary hearing still makes the dismissal unfair and payable.
What this practically means
#Executive summary
#Key legal issues
#Whether there was a valid reason for termination under Section 43
Valid reason existed - the Respondent genuinely believed, on investigations, that the Claimant's credentials were implicated in the fraud
A forensic investigation identified the Claimant's unique username Gideon.Kabaru among those used to introduce malware into the m-pesa server, and fraud of Kshs 91,176,192 was lost. The inability of the investigator to pinpoint the individual responsible was not exoneration. The criminal standard does not apply; the employer need only show genuine belief. Substantive fairness was therefore established.
Whether the termination procedure was fair under Section 41
Procedure was unfair - no show-cause letter, no charges, and no disciplinary hearing as required by the Employment Act and the Employee Handbook
The Respondent's own Employee Handbook required a disciplinary enquiry with written notification, at least 24 hours to prepare, representation, and mitigation. None of this was done; the Claimant was merely called to the office and issued a summary dismissal letter. The allegation about the HR officers' practicing certificates was dismissed as a red herring, but the process itself fell below the statutory and handbook standards.
Whether the remedies sought were merited
Only 1 month's salary compensation and a certificate of service granted; notice pay, interest and costs refused
Though entitled to compensation for the unfair procedure, the Claimant's conduct - a unique username used in the fraud, failure to report known interference with his credentials - breached his duty of trust and honesty, justifying a minimal award of one month's gross salary. Notice was not payable given valid reason for summary dismissal, and no order was made on interest and costs.
Legal principles established
#- The standard of proof of reason for termination under Section 43 of the Employment Act is not proof beyond reasonable doubt; the employer need only show genuine belief in the reason at the time of termination
- Substantive validity of reason and procedural fairness under Sections 43 and 41 are distinct; termination may be for valid reason yet procedurally unfair
Court orders
#- 1.It is declared that termination was based on valid reason, but unfair procedure.
- 2.The Respondent shall pay to the Claimant equivalent of 1-month salary in compensation for unfair termination at Kshs. 253,000.
- 3.Certificate of Service to issue.
- 4.No order on the costs and interest.
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act and Labour Relations Act (first-instance employment cause)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kabaru v Craft Silicon Limited (Cause 83 of 2019) [2023] KEELRC 1584 (KLR)", Case Analysis (2023). Cause No. 133 of 2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/1584/eng@2023-06-30
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.