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ELRCPartially AllowedNot stated in the judgment· [2023] KEELRC 3248 (KLR)

Onderi v Mini Bakeries (Nairobi) Limited (Cause E716 of 2021) [2023] KEELRC 3248 (KLR)

Employment and Labour Relations Court
6 December 2023
JGJacob Gakeri
6,892 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~28 min to read original · ~4 min brief

The bottom line

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Tuskys won on the reason for firing this employee but lost because it hid the audit evidence and denied him an appeal, so the court awarded compensation and costs.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent from 2007 and promoted to Assistant Operations Manager in 2018, sued for unfair termination following events at the Eastleigh Branch in December 2019. Sent to relieve one Thomas Nyarige without a handover, he took stock on 10th December 2019, uncovered anomalies, and co-signed a report that triggered an internal audit, criminal charges against several employees, and ultimately his own show-cause notice and termination on 4th March 2020. He claimed a declaration of unfair termination, notice pay, salary, pension arrears, unpaid leave, leave travelling allowance and 12 months' compensation. The court framed two issues: whether the termination was unfair and entitlement to reliefs. On substance, applying s.43(2) Employment Act and the reasonable-employer standard, the court found the Respondent genuinely believed the Claimant, aware the last stock take was 3rd December, failed to take stock on takeover, signed unverified cashflows, neglected generator fuel audits and participated in privately extracting repayment from Mr. Wandera instead of escalating anomalies - a valid and fair reason existed. On procedure, however, the Respondent failed to avail the audit report central to the disciplinary hearing, denying the Claimant a fair chance to prepare, and gave no right of appeal or review; termination was therefore procedurally unfair. The court declared the termination unfair, declined notice pay and the 12-month compensation claim, awarded admitted dues, salary to 25th February 2020, compensation of two months' gross salary, a certificate of service, costs and interest. Judgment delivered virtually at Nairobi on 6th December 2023 by Dr. Jacob Gakeri, Judge.

Key legal issues

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01

Substantive justification for termination

Holding

The Respondent had a valid and fair reason to terminate the Claimant's employment

Reasoning

The Claimant failed to take stock on taking over the Eastleigh Branch, signed the 3rd December cashflow without verification, failed to audit generator fuel consumption, and joined others in having Mr. Wandera make good the shortfall privately instead of escalating to management. Applying s.43(2) Employment Act and the reasonable-employer test, the employer genuinely believed the grounds existed.

p. 11
02

Procedural fairness of the termination

Holding

Termination was procedurally flawed and thus unfair

Reasoning

The Respondent did not avail the audit report on which the show-cause notice and disciplinary hearing were based, denying the Claimant a fair chance to prepare his defence, and did not afford him a right of appeal or review contrary to s.41 Employment Act.

p. 13
03

Quantum of compensation under s.49(1)(c) Employment Act

Holding

Equivalent of 2 months' gross salary awarded as compensation

Reasoning

The court considered the Claimant's 12 years of service and rise to Assistant Operations Manager, his contribution to the termination, his failure to appeal, and his record of over 9 warning letters (though none after promotion), concluding 2 months' gross salary was fair.

p. 15

Legal principles established

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  • An employer need only prove reasons it genuinely believed to exist at termination, on a balance of probability
  • An employee must be furnished with the documents and evidence the employer relies on at a disciplinary hearing as part of the right to a fair hearing
  • The right to appeal or review a termination decision is an essential ingredient of the right to be heard

Court orders

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  1. 1.Declaration that termination of the Claimant's employment by the Respondent was unfair for want of procedural propriety
  2. 2.Salary upto 25th February, 2020, if not paid
  3. 3.All prayers admitted by the Respondent as per its termination letter
  4. 4.Equivalent of 2 months gross salary
  5. 5.Certificate of service to be issued within 30 days
  6. 6.Costs of the suit to the Claimant
  7. 7.Interest at court rates from date of judgment till payment in full

Authorities

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Legislation

  • Employment Act, 2007Sections 41, 42, 43(1), 43(2), 45, 45(2), 45(4) and (5), 49(1)(c), 49(4), 51
  • Labour Institutions Act, 2007Section 24(1)
  • Employment and Labour Relations Court Act, 2011Section 20
  • Fair Administrative Action Act, 2015Section 4
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B
  • Constitution of KenyaArticles 159(2)(d), 48

Cases cited (13)

  • Leland I. Salano V Intercontinental Hotel
    (2013) eKLR
  • Anthony Mkalla Chitavi V Malindi Water & Sewerage Co. Ltd
    (2013) eKLR
  • Mary Chemweno Kiptui V Kenya Pipeline Co. Ltd
    (2014) eKLR
  • Meshack Auta Ongeri V Nyamache Tea Factory Co. Ltd
    (2019) eKLR
  • Reuben Kipkoech V Board of Management Moi Kipsitet Girls Secondary School
    (2019) eKLR
  • Naima Khamis V Oxford University Press EA Ltd
    (2017) eKLR
  • Walter Ogal Anuro V Teachers Service Commission
    (2013) eKLR
  • Galgalo Jarso Jillo V Agricultural Finance Corporation
    (2021) eKLR
  • British Leyland (UK) Ltd V Swift
    (1981) I.R.L.R 91
  • Kenya Revenue Authority V Reuwel Waithaka Gitahi & 2 others
    (2019) eKLR
  • Pius Machafu Isindu V Lavington Security Guards Ltd
    (2017) eKLR
  • Postal Corporation of Kenya V Andrew K. Tanui
    (2019) eKLR
  • David Wanjau Muhoro V Ol Pejeta Ranching Ltd
    (2014) eKLR
Jurisdiction invoked
Original jurisdiction under the Employment Act, 2007 and the Employment and Labour Relations Court Act, 2011

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, "Onderi v Mini Bakeries (Nairobi) Limited (Cause E716 of 2021) [2023] KEELRC 3248 (KLR)", Case Analysis (2023). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/3248/eng@2023-12-06

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