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ELRCPartially AllowedCause (number not stated in judgment as provided)· [2024] KEELRC 1089 (KLR)

Saka v Absa Bank Kenya PLC (Cause E383 of 2023) [2024] KEELRC 1089 (KLR)

Employment and Labour Relations Court
8 April 2024
4,757 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~19 min to read original · ~4 min brief

The bottom line

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A Kenyan court awarded a former Absa manager Kshs 6.56 million because the bank missed its own deadline to extend his probation, making his dismissal unlawful.

What this practically means

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Executive summary

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The Claimant, formerly Head of Products at Canterbury Securities in the Cayman Islands, was recruited by the Respondent bank as Senior Manager – Customer Journey Mapping, signing an employment contract on 17th June 2019 with a six-month probationary period extendable by three months. He claimed unfair labour practice and wrongful, arbitrary, unfair, summary and unlawful dismissal, contending that his probation was unjustifiably extended and that he was terminated on 3rd March 2020 without reason, notice or a hearing. He sought declarations, compensation of 12 months' gross pay, damages under the doctrine of legitimate expectation, and aggravated and exemplary damages for breach of Articles 10, 25, 27 and 41 of the Constitution. The Respondent maintained that unsatisfactory performance, absenteeism and disciplinary issues justified non-confirmation and that terminal dues were paid. The court found, on the Respondent's own internal emails, that the Claimant was never given a laptop or system access and was handicapped from the onset. Critically, the six-month probation expired on 17th December 2019 and the purported extension was only communicated on 9th January 2020, outside the contractual window; the contract was therefore confirmed by effluxion of time, and the purported termination of a probationary contract that no longer existed was unfair and unlawful. The court entered judgment for the Claimant with a declaration of unfair and unlawful termination, compensation of Kshs. 6,560,000/- (eight months' salary under section 49 of the Employment Act), costs, and interest on the compensation from the date of judgment. Aggravated damages and the leave claim were refused.

Key legal issues

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01

Whether the Claimant was on a probationary contract at the time of termination

Holding

The six-month probation expired on 17th December 2019 and the purported extension of 9th January 2020 came too late; the contract was confirmed by effluxion of time, so the purported termination of a probationary contract was of a contract that did not exist

Reasoning

The employment letter executed on 17th June 2019 provided for six months' probation extendable by three months. Probation would therefore have run until 17th December 2019. The Respondent only purported to extend the probation on 9th January 2020, after the probationary period had lapsed. Having failed to act within the contractual window, the Respondent could not thereafter treat the Claimant as a probationer, and termination on 3rd March 2020 of a purported probationary contract was unfair and unlawful under the Employment Act.

p. 8
02

Whether the Claimant was equipped to perform his duties and whether poor performance justified termination

Holding

The Claimant was handicapped from the onset because the Respondent never provided him with a laptop or system access despite a trail of email requests

Reasoning

An internal email of 28th February 2020 from Ms Sarah Muriuki detailed requests for MacBook Pro and MacBook Air laptops and conceded the Claimant had only been given a desk, telephone extension, notebook, pen and staff pass, with no mention of a computer. There was no indication laptops were ever acquired. The Respondent's own manager observed the Claimant took longer to fit in owing to the structure of his previous roles. The Claimant was therefore not supplied the tools needed to meet the performance expectations the Respondent relied on.

p. 8
03

What remedies flow from the unfair and unlawful termination

Holding

Compensation of 8 months' salary under section 49 of the Employment Act was awarded; aggravated and exemplary damages were refused due to mitigation; leave was refused as already paid

Reasoning

Given the egregious manner of termination without proper basis, the court exercised discretion under section 49 to award 8 months' gross salary (Kshs. 6,560,000/-). Aggravated and exemplary constitutional damages were denied because the Claimant mitigated his losses by securing new employment. The leave claim failed as terminal dues for untaken leave had already been paid, and the declaration on unfairness was granted with costs and interest.

p. 8

Legal principles established

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  • Where an employer fails to extend a probationary contract within the contractual timeframe, the contract is confirmed by effluxion of time and termination must thereafter comply with the Employment Act
  • Terminating a probationary contract that no longer exists because it was confirmed by effluxion of time is unfair and unlawful

Court orders

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  1. 1.A declaration that the termination of the Claimant's services by the Respondent was unfair and unlawful
  2. 2.Kshs. 6,560,000/- as compensation
  3. 3.Costs of the suit
  4. 4.Interest at court rates on the compensation sum from the date of judgment till payment in full

Authorities

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Legislation

  • Employment Act, 2007section 2 (definition of probationary contract)
  • Employment Act, 2007section 35(1)(c)
  • Employment Act, 2007section 40
  • Employment Act, 2007section 41
  • Employment Act, 2007section 42(1) and 42(2)
  • Employment Act, 2007section 44(4)
  • Employment Act, 2007section 49
  • Constitution of Kenya, 2010Articles 10, 25, 27 and 41

Cases cited (10)

  • Narry Philemons Onaya-Odeck v Technical University of Kenya (Formerly, the Kenya Polytechnic University College)
    [2017] eKLR
  • Mwilo v Absa Bank (K) PLC
    (Cause 31 of 2020) [2022] KEELRC 53 (KLR) (5 May 2022)
  • Monica Munira Kibuchi & 6 others v Mount Kenya University; Attorney General (Interested Party)
    [2021] eKLR
  • South Nyanza Sugar Co. Ltd v Leonard O. Arera
    [2020] eKLR
  • National Bank of Kenya Ltd v Pipeplastic Samkolit (K) Ltd & another
    [2001] eKLR
  • Janet Nyandiko v Kenya Commercial Bank Limited
    [2017] eKLR
  • Jane Samba Mukala v Ol Tukai Lodge Limited
    [2013] eKLR
  • Samuel Kamau Macharia & another v Kenya Commercial Bank Limited & 2 others
    [2012] eKLR
  • Okumu v Good Man Agencies Limited
    (Cause 1895 of 2017) [2022] KEELRC 13514 (KLR) (9 December 2022)
  • Danish Jalang'o & another v Amicabre Travel Services Limited
    [2014] eKLR
Jurisdiction invoked
First-instance employment claim under the Employment Act, 2007 and Articles 10, 25, 27 and 41 of the Constitution of Kenya, 2010

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, "Saka v Absa Bank Kenya PLC (Cause E383 of 2023) [2024] KEELRC 1089 (KLR)", Case Analysis (2024). Cause (number not stated in judgment as provided). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1089/eng@2024-04-08

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