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ELRCPartially AllowedCause No E184 of 2023· [2024] KEELRC 1800 (KLR)

Matanda v Pathfinder International Kenya (Cause E184 of 2023) [2024] KEELRC 1800 (KLR)

Employment and Labour Relations Court of Kenya
15 July 2024
4,647 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 ruled an employer's termination unfair because it hid key evidence from the employee and illegally extended his probation without consent.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent on 8th April 2022 as a Global Information Security Officer under a two-year fixed-term contract with a six-month probationary period, sued for unfair termination following the termination of his employment on 22nd February 2023 over allegations that he falsified travel receipts for trips between 10th–14th October 2022 (Homabay) and 24th–28th October 2022 (Mombasa). He sought declarations, reinstatement (later abandoned), and various dues including salary for the remainder of the contract term and 12 months' compensation. The Respondent maintained the termination was for lawful cause and followed a fair procedure. The court framed three issues: probationary status, fairness of termination, and reliefs. It held that the purported unilateral extension and suspension of probation without the Claimant's agreement, contrary to Section 42(2) of the Employment Act, was unlawful and ineffectual, so the Claimant was confirmed by operation of law from 1st January 2023. On substance, the Respondent failed to avail the allegedly genuine receipts, the driver's identity, or the vendor's written response, and did not controvert the confirmation from Nadine Carhire and Tours that the disputed receipts were genuine; it therefore failed to prove a reasonable basis to believe misconduct occurred. Procedurally, refusal to furnish receipts 160 and 171 vitiated the hearing, and there was no evidence the Respondent considered the Claimant's representations, breaching Section 41. The court declared the termination unfair and the probation extension unlawful, awarded compensation equivalent to two months' gross salary (Kshs.1,662,023.32) under Section 49(1)(c), and ordered each party to bear their own costs. Claims for anticipatory earnings for the unexpired contract term were disallowed.

Key legal issues

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01

Whether the Claimant was still on probation when his probation was suspended

Holding

No. The probation lapsed at the end of December 2022 because the purported extension was unilateral and without the Claimant's agreement; he was confirmed by operation of law effective 1st January 2023.

Reasoning

Section 42(2) of the Employment Act permits extension of a six-month probation by not more than six months only with the employee's agreement. The Respondent adduced no evidence that the Claimant agreed to the extension, and had not formally discussed or appraised his performance as its own Staff Handbook required. A probationary contract, being a contract of employment, cannot be varied without consent. Consequently the extension and the purported suspension of probation were ineffectual.

p. 9
02

Whether termination was substantively justified

Holding

No. The Respondent failed to prove on a balance of probabilities that it had a reasonable basis to genuinely believe the Claimant falsified receipts.

Reasoning

The investigation report had several gaps: the allegedly genuine receipts numbers 160 and 171 were never availed to the Claimant or filed in court, the driver's name and phone number were not disclosed, and the vendor's response disputing receipts 5698, 5741 and 5761 was neither attached nor availed. The service provider Nadine Carhire and Tours had in writing confirmed the receipts genuine, and the Respondent did not controvert that letter. The Claimant's evidence that the receipts were genuine therefore remained uncontroverted.

p. 8
03

Whether the disciplinary procedure met the threshold of Section 41 of the Employment Act

Holding

No. The refusal to furnish the alleged genuine receipts vitiated the procedure, and there is no evidence the Respondent considered the Claimant's representations.

Reasoning

Although the Claimant was issued a notice to show cause, responded, and was heard with his counsel, the Respondent declined to avail receipts 160 and 171 which were the only evidence for the first charge. Neither the minutes nor the termination letter referred to the Claimant's representations, and neither document identified the falsified receipts or how the figure of Kshs.32,250 was computed. The procedure therefore failed the mandatory requirements of Section 41.

p. 9
04

Quantum of compensation for unfair termination

Holding

The equivalent of 2 months' gross salary, Kshs.1,662,023.32, under Section 49(1)(c) of the Employment Act.

Reasoning

The court considered the short duration of employment (73/4 months), the absence of recorded misconduct or poor performance, the Claimant's expressed wish to remain in employment, his own contribution in affording the Respondent reason to doubt his honesty, and the fact that the Respondent had already paid the non-contentious dues including gratuity. These factors led the court to award the equivalent of two months' salary.

p. 10

Legal principles established

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  • A probationary period may only be extended with the agreement of the employee; a unilateral extension is unlawful and inefiectual
  • An employee must be availed the evidence the employer intends to rely on in a disciplinary hearing as a requirement of fair hearing
  • The employer bears the burden of proving valid and fair reason and fair procedure on a balance of probabilities

Court orders

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  1. 1.Declaration that termination of employment by the Respondent was unfair
  2. 2.Declaration that the unilateral extension of probation by the Respondent was unlawful
  3. 3.Equivalent of 2 months gross salary Kshs.1,662,023.32 as compensation for unfair termination
  4. 4.Each party to bear their own costs

Authorities

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Legislation

  • Employment Act, 2007Section 43 and 47(5)
  • Employment Act, 2007Section 42(2)
  • Employment Act, 2007Section 45
  • Employment Act, 2007Section 43(2)
  • Employment Act, 2007Section 41
  • Employment Act, 2007Section 49(1)(c)
  • Constitution of KenyaArticle 159(2)(d)
  • Constitution of KenyaArticle 48
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B

Cases cited (18)

  • Lear Shighadi Sinoya V Autech Systems Ltd
  • Muthaiga Country Club V Kudheiha Workers (2017) eKLR
    (2017) eKLR
  • Judicial Service Commission V Gladys Boss Shollei & another, Civil Appeal No. 50 of 2014
    Civil Appeal No. 50 of 2014
  • Michael Dowling V Work Place Safety & Insurance Board (2004) CAN LII 43692
    (2004) CAN LII 43692
  • Jackson Kanigia Myagah V University of Nairobi (2022) eKLR
    (2022) eKLR
  • Kenfreight (EA) Ltd V Bension K. Nguti (2016) eKLR
    (2016) eKLR
  • Galgalo Jarso Jillo V Agricultural Finance Corporation (2021) eKLR
    (2021) eKLR
  • Hamson Muhia Mwangi V Standard Chartered Bank
  • Narry Philemon Onaya-Odeck V Technical University of Kenya (2017) eKLR
    (2017) eKLR
  • David Araka V Uchumi Supermarkets Ltd (2021) eKLR
    (2021) eKLR
  • Naima Khamis V Oxford University Press (E.A) Ltd (2017) eKLR
    (2017) eKLR
  • Walter Ogal Anuro V Teachers Service Commission (2013) eKLR
    (2013) eKLR
  • Kenya Revenue Authority V Reuwel Waithaka Gitahi & 2 others (2019) eKLR
    (2019) eKLR
  • Pius Machafu Isindu V Lavington Security Guards Ltd (2017)
    (2017)
  • Postal Corporation of Kenya V Andrew K. Tanui (2019) eKLR
    (2019) eKLR
  • D.K. Njagi Marete V Teachers Service Commission (2020) eKLR
    (2020) eKLR
  • Engineer Francis Gachuri V Energy Regulatory Commission (2015) eKLR
    (2015) eKLR
  • Elizabeth Wakanyi Kibe V Telkom Kenya Ltd (2014) eKLR
    (2014) eKLR
Jurisdiction invoked
Original jurisdiction under the Employment Act, 2007 (ss. 41, 42, 43, 45, 47(5), 49) in the Employment and Labour Relations Court

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, "Matanda v Pathfinder International Kenya (Cause E184 of 2023) [2024] KEELRC 1800 (KLR)", Case Analysis (2024). Cause No E184 of 2023. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1800/eng@2024-07-15

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