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ELRCDismissedNot stated in the extract· [2023] KEELRC 2136 (KLR)

Murema v Treadsetters Tyres Limited (Cause 801 of 2019) [2023] KEELRC 2136 (KLR)

Employment and Labour Relations Court
22 September 2023
AJABUODHA J.N
2,742 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 dismissed a manager's claim for unfair dismissal, ruling that being investigated for suspected workplace fraud is not constructive dismissal.

What this practically means

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Executive summary

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The claimant, employed by the respondent from 1998 and earning a monthly salary, pleaded that he was constructively dismissed. He alleged that a 2017 retrenchment notice was a sham, that he was denied duties which were allocated to a new employee occupying his workstation, that he was sent on compulsory leave, that his salary was stopped and reinstated without explanation, and that he was finally summarily dismissed on March 12, 2019. He sought 12 months' compensation, notice pay, mileage and internet allowances, accrued leave, and pension benefits. The respondent denied constructive dismissal, contending that an extensive IT systems fraud resulting in losses of over Kshs 101 million occurred during the claimant's tenure as MIS Systems Manager, that a forensic audit detected deletion of invoices from the back end of the system at night, and that after a show cause letter and disciplinary hearing the summary dismissal was justified and procedural. The claimant admitted in cross-examination that his contract did not provide for mileage or internet allowances. The court applied the constructive dismissal tests in Coca Cola v Ligaga and Western Excavating v Sharp, holding that the respondent's investigation of suspected fraud and the call for explanations did not amount to treatment sufficiently bad to constitute constructive dismissal. The leave claim failed because the dismissal letter promised accrued leave and non-payment of terminal dues was never alleged. The entire claim was dismissed with costs to the respondent.

Key legal issues

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01

Whether the claimant was constructively dismissed

Holding

No; the claimant failed to set out in detail the bad treatment, and the respondent's actions in investigating suspected fraud could not amount to constructive dismissal

Reasoning

The court applied the Coca Cola and Western Excavating tests. The respondent had reasonable suspicion of fraud and negligence during the claimant's tenure as Systems Manager; invoices were deleted at night and the claimant spent considerable time online on Fridays. A forensic audit was conducted and the claimant was called to explain. Such treatment was not sufficiently bad to amount to a fundamental breach entitling the claimant to treat himself as dismissed.

p. 5
02

Whether the claimant was entitled to mileage and internet allowances

Holding

No; the claimant admitted his contract never provided for these allowances

Reasoning

In cross-examination on his terms of service the claimant conceded that his contract contained no provision for mileage or internet allowances. Having admitted this, the claims for Kshs 70,000 per month mileage and Kshs 2,000 per month internet allowance could not stand, and both were disallowed.

p. 5
03

Whether the claimant was entitled to accrued leave days

Holding

Claim not sustained; the summary dismissal letter promised payment of accrued leave and the claimant never alleged non-payment of terminal dues

Reasoning

The letter of summary dismissal stated the claimant would be paid accrued leave days in addition to salary due. The claim could only succeed if terminal dues were not paid, but no such allegation was made at trial, so the leave claim failed.

p. 6

Legal principles established

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  • Constructive dismissal occurs where an employee is forced to leave his job against his will because of the employer's conduct; the treatment must be sufficiently bad that the employee regards himself as unfairly dismissed
  • Per Lord Denning, constructive dismissal requires a significant breach of the contract going to its root, and the employee must not affirm the contract by continuing in employment

Court orders

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  1. 1.The claim is dismissed
  2. 2.Costs awarded to the respondent
Jurisdiction invoked
Original jurisdiction of the Employment and Labour Relations Court over employment dispute (statement of claim filed November 27, 2019)

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, "Murema v Treadsetters Tyres Limited (Cause 801 of 2019) [2023] KEELRC 2136 (KLR)", Case Analysis (2023). Not stated in the extract. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/2136/eng@2023-09-22

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