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ELRCPartially AllowedCause E243 of 2021· [2023] KEELRC 2889 (KLR)

Munyori v Bank of Africa Limited (Cause 1447 of 2018) [2023] KEELRC 2889 (KLR)

Employment and Labour Relations Court
14 November 2023
6,749 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 a bank fairly dismissed a negligent employee but unfairly, awarding her five months' salary because she wasn't given a proper hearing.

What this practically means

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Executive summary

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The claimant, employed by the respondent bank from 2005 and rising to Operations Assistant at Kshs.156,000 per month, was summarily dismissed on 22nd October 2015 after erroneously processing a payment of USD 6,000,000 as 6 million South African Rands to Dubai Bank on 2nd July 2015, causing a loss of Kshs.48,180,000 after Dubai Bank entered receivership. She sought 12 months' salary compensation, service pay, notice pay, an apology, general, exemplary and defamation damages; the respondent counterclaimed for an outstanding loan balance of Kshs.664,079.21. The court, Gakeri J, framed three issues: substantive and procedural fairness of the termination, the claimant's remedies, and the counterclaim. It found the respondent had a valid and fair reason since the claimant, an experienced treasury officer, failed to confirm the currency details on the Swift message, applying the genuine-belief test in Section 43(2) and the band of reasonableness. However, the dismissal was procedurally unfair: the claimant was given only two days to respond and prepare for the hearing, and was denied the investigation report and audit report relied upon, breaching Section 41 and the right to a fair hearing. The counterclaim failed for want of documentary proof of the loan balance. Judgment was entered for the claimant for the equivalent of 5 months' salary, with costs of the suit and interest at court rates from the date of judgment. All other prayers, including service pay, notice pay, defamation and exemplary damages and the apology, were declined.

Key legal issues

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01

Substantive justification for termination

Holding

The Respondent had a valid and fair reason - the claimant's want of care in processing the Swift message

Reasoning

The claimant admitted mistaking USD 6,000,000 for 6 million South African Rands and credited Dubai Bank without confirming details. Given the amount and her seniority in the Treasury Back Office since 2009, the employer was entitled to expect vigilance. Applying the employer's genuine belief test under Section 43(2) and the band of reasonableness, the court found reasonable grounds to believe her conduct demonstrated want of care.

p. 10
02

Procedural fairness

Holding

The dismissal was procedurally unfair - two days to prepare and denial of the investigation and audit reports

Reasoning

The notice to show cause issued on 18th September 2015 with hearing on 21st September gave the claimant only two days for serious allegations. She was suspended to pave way for investigations yet the investigation report was never availed or filed in court, impeding her defence. The respondent thus failed to discharge its burden under Sections 45(2) and 47(5), rendering the summary dismissal unfair for want of procedural propriety.

p. 13
03

Compensation quantum

Holding

Equivalent of 5 months' salary awarded

Reasoning

The court considered the 10 years of service, promotions and clean disciplinary record, but found the claimant substantially contributed to the termination through her own negligence, warranting reduction from the 12 months sought to 5 months' salary under Section 49(1)(c).

p. 13
04

Counterclaim

Holding

Dismissed for want of proof of the outstanding balance

Reasoning

The respondent pleaded an outstanding debt of Kshs.664,079.21 but did not produce the mortgage account statements showing how the balance arose after the claimant paid Kshs.6.1 million; RWIII admitted having no evidence of the loan account. The counterclaim therefore failed for want of documentary proof.

p. 14

Legal principles established

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  • A valid and fair reason plus a fair procedure are both required for a fair termination under Section 45 of the Employment Act
  • An employee must be accorded sufficient time to prepare for a disciplinary hearing and be supplied with documents the decision maker will rely on

Court orders

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  1. 1.Judgment entered for the Claimant against the Respondent in the equivalent of 5 months' salary
  2. 2.Costs of the suit to the Claimant
  3. 3.Interest at court rates from the date of judgment until payment in full
  4. 4.All other prayers declined
  5. 5.Counterclaim dismissed for want of proof

Authorities

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Legislation

  • Employment ActSections 35(6)(d), 41, 43, 43(2), 44(4)(c), 45, 45(1), 45(2), 45(5), 47(5), 49(1)(c)
  • Criminal Procedure CodeSection 210
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B
  • Constitution of KenyaArticles 159(2)(d), 48

Cases cited (16)

  • Donald C Avude V Kenya Forest Service
    (2015)
  • Kenya Petroleum oil Workers union vs Kenya Shell Limited
    (2014) eKLR
  • JMD vs Nacico Society Limited
    (2016) eKLR
  • Walter Ogal Anuro V Teachers Service Commission
    (2013) eKLR
  • Naima Khamis V Oxford University Press (EA) Ltd
    (2017) eKLR
  • Kenya Revenue Authority V Reuwel Withaka Gitahi & 2 others
    (2019) eKLR
  • Galgalo Jarso Jilllo V Agricultural Finance Corporation
    (2021) eKLR
  • British Leyland (UK) Ltd V Swift
    (1981) I.R.L. R 91
  • Postal Corporation of Kenya v Andrew K. Tanui
    [2019] eKLR
  • Rebecca Ann Maina V Jomo Kenyatta University of Agriculture and Technology
    (2014) eKLR
  • Benjamin Mwendwa Nduati & 4 others V East Africa Portland Cement Co. Ltd
    (2016) eKLR
  • Ruth Adhiambo Apindi V Unilever Kenya ltd
    (2020) eKLR
  • Lilian Muchungi V Green Belt Movement
    (2022) eKLR
  • David Muhoro V Ol Pejeta Ranching Ltd
    (2014) eKLR
  • Rookes V Barnard & others
    (1964) AC 1129
  • Obonyo & another V Municipal Counsel of Kisumu
    (1971) EA 91
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 and the Labour Relations Act over unfair termination of employment claims

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, "Munyori v Bank of Africa Limited (Cause 1447 of 2018) [2023] KEELRC 2889 (KLR)", Case Analysis (2023). Cause E243 of 2021. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/2889/eng@2023-11-14

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