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ELRCDismissedMemorandum of claim dated 20th September 2022, filed 27th September 2022· [2023] KEELRC 1619 (KLR)

Otieno v Butali Sugar Mills Limited (Employment and Labour Relations Claim E026 of 2022) [2023] KEELRC 1619 (KLR)

Employment and Labour Relations Court
29 June 2023
JKJemimah Keli
5,401 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~22 min to read original · ~4 min brief

The bottom line

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A Kenyan court confirmed an employer can fairly dismiss an employee for negligence even after criminal charges fail, and malicious prosecution claims belong against the DPP, not employers.

What this practically means

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Executive summary

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The claimant, a transport and logistics assistant employed by the respondent supermarket from 3rd April 2013 until 22nd August 2022, sued after his employment was terminated over the disappearance of a motor vehicle tractor. He sought declarations of unfair termination, twelve months' salary as damages, special damages for legal fees in a criminal matter, general damages for malicious prosecution, and exemplary damages for psychological torture. He also claimed he had been maliciously prosecuted after being cleared by the Director of Public Prosecutions while other arrested employees were spared. The respondent maintained that it reported the missing tractor to police, accorded the claimant a disciplinary hearing, and established negligence and misconduct. The court framed three issues. On malicious prosecution, it doubted its jurisdiction, holding that prosecution is the sole mandate of the DPP under Article 157(6) of the Constitution, that the employer had a right to report the missing tractor, and that any such claim lay against the DPP, declining to follow Naqvi Syed Qmar v Paramount Bank. On substantive fairness, the court applied sections 43 and 45 of the Employment Act and the band-of-reasonableness test from British Leyland v Swift, finding the claimant negligent in releasing a report showing a tractor parked when it was off the tracking radar and in the handling of the insurance sticker, and holding that acquittal in a criminal case does not preclude dismissal for neglect of duty, per Wasike. On procedural fairness, it found show cause, response, hearing and the opportunity for representation complied with section 41, rejecting allegations of a locked-out representative as evidence from the bar. The entire claim was dismissed with costs to the respondent; terminal dues had been paid.

Key legal issues

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01

Whether the claimant was subjected to malicious prosecution by the respondent and whether the court had jurisdiction

Holding

The court doubted its jurisdiction; prosecution is the DPP's sole mandate under Article 157(6), so any malicious prosecution claim lies against the DPP, not the employer.

Reasoning

The court reasoned that the respondent had a right to report the missing tractor to police, the suspension was police-requested, and the DPP takes full responsibility for prosecuting criminal cases. It declined to follow Naqvi Syed Qmar v Paramount Bank and held the claim was mistakenly brought against the employer.

p. 4
02

Whether the reasons for termination were valid and justified (substantive fairness)

Holding

Yes - negligence in respect of the missing tractor and the insurance sticker were valid reasons meeting section 43 and the reasonable-employer test.

Reasoning

The claimant, as fleet and logistics assistant, released a report showing the tractor was parked though it was off the tracking radar, and the disciplinary minutes showed he took responsibility for the insurance sticker. Applying section 43 and the band of reasonableness from British Leyland v Swift, the employer's genuine belief in the reasons was justified; the criminal case's outcome was irrelevant per Wasike.

p. 7
03

Whether the termination procedure was fair under section 41 of the Employment Act

Holding

Yes - the claimant received a show cause letter, responded, was invited to a disciplinary hearing, and was reminded of his right to representation.

Reasoning

The court found no pleading that the claimant's representative was locked out; that allegation was evidence from the bar. Same-day decision-making attracts no fault as the law sets no timelines. Following Paul Waigiri Muriuki v Nairobi Water, the employer complied with section 41.

p. 9
04

Whether the claimant was entitled to the reliefs sought

Holding

No - the termination was lawful and fair and terminal dues were paid; the entire claim was dismissed with costs.

Reasoning

Having found substantive and procedural fairness, no reliefs were available. The claimant had been paid salary, notice pay, gratuity and leave earnings, and the court cited Wasike on respecting employers' rights where due process is followed.

p. 10

Legal principles established

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  • The burden of proving the reason for termination lies on the employer under section 43 of the Employment Act, and reasons are those the employer genuinely believed to exist at termination.
  • Criminal acquittal does not bar disciplinary dismissal for neglect of duty; the two processes are separate with different standards of proof.
  • An employer cannot be liable for malicious prosecution before this court where prosecution is the sole mandate of the DPP under Article 157(6) of the Constitution.
  • An employer is obliged only to offer an employee the opportunity to be accompanied by a representative of choice; same-day decision after a disciplinary hearing is not a procedural defect.

Court orders

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  1. 1.The claim dated 20th September 2022 is dismissed with costs to the respondent

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 157(6)
  • Employment ActSection 41(1) and 41(2)
  • Employment ActSection 43(1) and 43(2)
  • Employment ActSection 44(3) and 44(4)(c)&(g)
  • Employment ActSection 45(1) and 45(2)
  • Penal Codetheft provisions (referred to generally)

Cases cited (6)

  • Naqvi Syed Qmar v Paramount Bank Limited
    (2015) eKLR
  • British Reyland UK Limited v Swift
    (1981) I.R.L.R 91
  • Kenya Power & Lighting Company Limited v Aggrey Lukorito Wasike
    [2017] eKLR
  • Nelson Mwangi Kibe v Attorney General
    [2003] eKLR
  • Paul Waigiri Muriuki v Nairobi Water and Sewerage Company Limited
    (2015) eKLR
  • Pius Machafu Isindu v Lavington Security Guards Limited
    [2017] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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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, "Otieno v Butali Sugar Mills Limited (Employment and Labour Relations Claim E026 of 2022) [2023] KEELRC 1619 (KLR)", Case Analysis (2023). Memorandum of claim dated 20th September 2022, filed 27th September 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/1619/eng@2023-06-29

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