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ELRCPartially AllowedAppeal against the judgment in Mombasa MCELRC No 82 of 2018 (number not stated in the judgment)· [2024] KEELRC 1404 (KLR)

Siginon Group Limited v Mwaruwa (Appeal E071 of 2023) [2024] KEELRC 1404 (KLR)

Employment and Labour Relations Court
20 March 2024
3,247 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~13 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ruled an employer can dismiss a negligent driver without compensation and recover Kshs 8.2 million in damages from him.

What this practically means

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Executive summary

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This is a first appeal by the employer, Siginon Group, against a judgment of the subordinate court in Mombasa MCELRC No 82 of 2018 delivered on 13 July 2023, which dismissed the employer's counterclaim and awarded the respondent, a heavy commercial driver, compensation of eight months' wages (Kshs 379,180.80), a certificate of service, interest and costs following summary dismissal. The dismissal arose from a road accident on 2 April 2016 in which the respondent, driving the appellant's truck KCD 220Q, encroached on the oncoming lane and collided with two other vehicles, causing repair costs of Kshs 264,110 and truck downtime losses of Kshs 8,000,000. The respondent had been issued a show cause notice, responded admitting the accident but describing it as an act of God, and attended a disciplinary hearing accompanied by a colleague. The appellate court, conducting a rehearing, held that procedural fairness was met but overturned the trial court's finding on substantive fairness: the employer genuinely and reasonably believed the respondent was negligent, having been charged with a traffic offence and having admitted the accident, and no investigation report was required under sections 41, 43 or 44 of the Employment Act. Applying section 44(4)(g), the court held the summary dismissal justified and set aside the award of compensation. On the counterclaim, invoking section 19(1)(b) of the Act, the court held the employer may recover losses for damage to its property caused by the employee's wilful default, and entered judgment for the appellant in the sum of Kshs 8,264,110. The appeal was allowed and each party ordered to bear its own costs.

Key legal issues

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01

Substantive justification for summary dismissal

Holding

The dismissal was substantively justified: the respondent caused an accident, was charged with a traffic offence, and admitted the accident, giving the employer genuine and valid grounds under sections 43 and 44(4)(g) of the Employment Act.

Reasoning

The court held the employer need only show reasons it genuinely believed to exist, assessed objectively against what a reasonable employer would do. The respondent's admission of the accident, the traffic charge and the damage to the truck sufficed. The requirement of an investigation report found by the trial court is not mandated by sections 41, 43 or 44 of the Act.

p. 6
02

Procedural fairness

Holding

Procedural fairness was satisfied: show cause notice, response, disciplinary hearing notice and the right to bring another employee were all afforded.

Reasoning

The court endorsed the trial court's finding that notice to show cause was issued, a disciplinary hearing notice was issued, and the respondent was allowed to bring another employee of his choice, satisfying section 41 of the Employment Act.

p. 5
03

Counterclaim for damages to employer's property

Holding

The appellant was entitled to recover Kshs 8,264,110 for repairs and truck downtime caused by the respondent's negligence, per section 19(1)(b) of the Employment Act.

Reasoning

Unlike commercial disputes, employment law permits the employer to recover losses for damage to its property occasioned by the employee's wilful default or negligent performance of duties. The trial court's contrary finding on the contract for repairs was an error of law.

p. 6

Legal principles established

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  • A first appeal is a rehearing; the first appellate court must re-evaluate the entire evidence and arrive at its own findings of fact.
  • An employer need only prove reasons it genuinely believed to exist for dismissal; the standard is not proof beyond reasonable doubt.
  • An employer may recover from an employee losses for damage to its property caused by the employee's wilful default, per section 19(1)(b) of the Employment Act.

Court orders

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  1. 1.The appeal is allowed
  2. 2.Judgment in Mombasa MCELRC No 82 of 2018 is set aside, including the award of compensation of Kshs 379,180.80
  3. 3.Judgment is entered in the counterclaim for the appellant against the respondent in the sum of Kshs 8,264,110
  4. 4.Each party is to bear its own costs

Authorities

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Legislation

  • Employment Act, 2007section 44(4)(g)
  • Employment Act, 2007section 43
  • Employment Act, 2007section 41
  • Employment Act, 2007section 41(2)
  • Employment Act, 2007section 19(1)(b)
  • Employment Act, 2007section 17(1)

Cases cited (10)

  • CFC Stanbic Bank Limited v Danson Mwashako Mwakuwona
    Civil Appeal No 3 of 2014 - Mombasa
  • East Africa Portland v Nduati and 4 others
    Civil Appeal No 202 of 2017
  • Stephen Kanjabi Wariari v Dennis Mutwiri Muriuki & another
    [2022] eKLR
  • Oloo v H Young & Co (EA) Limited
    (Cause 654 of 2018) [2022] KEELRC 3792 (KLR) (28 July 2022)
  • Mburu v CIC General Insurance Limited
    (Cause 53 of 2019) [2023] KEELRC 807 (KLR) (27 March 2023)
  • Olute v County Government of Siaya & another
    (Cause E059 of 2021) [2022] KEELRC 13206 (KLR) (17 November 2022)
  • Matsesho v Newton
    (Cause 9 of 2019) [2022] eKLR
  • Galgalo Jarso Jillo v Agricultural Finance Corporation
    [2021] eKLR
  • Kenya Power & Lighting Company Limited v Aggrey Lukorito Wasike
    [2017] eKLR
  • Simon Kimotho Wanjiru v Siginon Group
    CMCC No 1979 of 2017
On appeal from
Mombasa Magistrates Court (ELRC), MCELRC No 82 of 2018
MCELRC No 82 of 2018
Jurisdiction invoked
First appellate jurisdiction over the subordinate court's judgment in MCELRC No 82 of 2018

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, "Siginon Group Limited v Mwaruwa (Appeal E071 of 2023) [2024] KEELRC 1404 (KLR)", Case Analysis (2024). Appeal against the judgment in Mombasa MCELRC No 82 of 2018 (number not stated in the judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1404/eng@2024-03-20

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