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ELRCPartially AllowedNot stated in judgment· [2023] KEELRC 3257 (KLR)

Njiru v Standard Chartered Bank Limited (Cause 679 of 2018) [2023] KEELRC 3257 (KLR)

Employment and Labour Relations Court
7 December 2023
BOByram Ongaya
2,717 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~11 min to read original · ~4 min brief

The bottom line

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What this practically means

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Executive summary

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The claimant, formerly the respondent bank's Client Service Manager at Muthaiga Branch, was summarily terminated on 10.04.2017 over two 2016 foreign-exchange transactions involving priority clients (Dr. Liam/Lian and Achieng Butler) which caused the bank losses of Kshs 10,500 and a near-miss of Kshs 134,775. She sought declarations of unfair dismissal, reinstatement, compensation to retirement age and CRB delisting, with alternative monetary reliefs. The respondent maintained the termination was lawful and fair, citing negligence and breach of the diligence clause of her contract. The court found the contract of service undisputed and its termination by the 10.04.2017 letter undisputed. On merits, it held both reasons for termination were neither valid nor fair under sections 43 and 45 of the Employment Act: the Dr. Liam mix-up resulted from the client's impatience, not the claimant's failure to confirm currency, and in the Butler matter the claimant had fully explained the applied rate and satisfied the client. Procedurally, though the claimant was heard per section 41, the respondent's unexplained failure to determine her contractual appeal rendered the process unfair. On remedies, the court found notice pay, April 2017 salary and accrued leave already paid; awarded 5 months' gross salary (Kshs 826,875.00 less PAYE) under section 49, factoring in the claimant's contribution to her termination and prior warning; declined CRB delisting, reinstatement (deemed abandoned and time-barred under section 12 of the ELRC Act), and claims for overtime, housing allowance and loan revision. Judgment was entered for the claimant with costs.

Key legal issues

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01

Validity and fairness of the reasons for termination

Holding

Both reasons (the Dr. Liam and Achieng Butler forex transactions) were neither valid nor fair under sections 43 and 45 of the Employment Act

Reasoning

The court found no reason to doubt the claimant's account that Dr. Liam was impatient and the mix-up did not stem from her failure to confirm currency. On the Butler transaction, the claimant had explained the applied rate, the customer understood, and the matter rested; she therefore discharged her duty to serve the client despite the bumpiness. Neither ground related to her conduct, compatibility or the respondent's operational system.

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02

Procedural fairness of the termination

Holding

Although the claimant was notified and heard per section 41, the employer's unexplained failure to determine her appeal under the contractual procedure rendered the process unfair

Reasoning

The claimant was given notice of allegations and heard, satisfying section 41. However, the termination letter granted a right of appeal which the claimant exercised; the respondent's failure to decide the appeal for unexplained reasons breached the contractual fair process, constituting procedural unfairness.

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03

Remedies under section 49 of the Employment Act

Holding

Compensation of 5 months' gross salary (Kshs 826,875.00 less PAYE), the claimant having contributed to the termination and lacking a clean record

Reasoning

The court considered section 49 factors: the claimant's prior warning letter, her admitted gap and apology, her contribution to the termination, the unfair termination itself, the failure to decide the appeal, and her length of service. One month's notice pay, April 2017 days and accrued leave were found already paid on a balance of probability.

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Legal principles established

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  • A reason for termination must be a valid and fair reason under sections 43 and 45 of the Employment Act, relating to the employee's conduct, compatibility or the employer's operational requirements
  • Where an employer's contractual appeal procedure entitles an employee to appeal a termination, failure to determine the appeal renders the termination process procedurally unfair

Court orders

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  1. 1.Payment of Kshs 826,875.00 less PAYE by 01.02.2024, failing which interest at Court rates from the date of judgment till full payment
  2. 2.The respondent to pay costs of the suit

Authorities

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Legislation

  • Employment Actsection 43
  • Employment Actsection 45
  • Employment Actsection 41
  • Employment Actsection 49
  • Employment and Labour Relations Court Actsection 12
Jurisdiction invoked
Employment and Labour Relations Court Act, section 12; Employment Act (first-instance employment claim)

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, "Njiru v Standard Chartered Bank Limited (Cause 679 of 2018) [2023] KEELRC 3257 (KLR)", Case Analysis (2023). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/3257/eng@2023-12-07

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