Kinyanjui v Rural Electrification & Renewable Corporation (Cause E709 of 2022) [2024] KEELRC 1824 (KLR)
The bottom line
#Kenya's Employment Court ruled a state corporation unfairly fired its accountant because it never proved its fraud allegations or ran a fair disciplinary process.
What this practically means
#Executive summary
#Key legal issues
#Validity and fairness of the reasons for termination
The Respondent failed to prove a valid and fair reason for the summary dismissal, contrary to Sections 43(1) and 45(2)(a)(b) of the Employment Act
The Respondent did not lead evidence to show that the reference numbers in the payment documents did not exist in the SAP system, did not produce the internal audit report relied upon, and did not prove the manner in which the Claimant failed to detect fraud or internal control gaps. The exhibited payment documents bore approvals, delivery notes and certificates of completion signed by others. Negligence was therefore not proved on a balance of probabilities.
Procedural fairness of the disciplinary process
The termination was procedurally unfair: the allegations lacked particulars, notice of the hearing was insufficient, the adjournment request was refused, and access to the audit report and payment documents was denied contrary to Article 35(1)(b) of the Constitution
The show cause letter was general and lacking in particulars, disadvantaging the Claimant's ability to respond. The disciplinary hearing was set with very short notice and the adjournment request declined. The Respondent refused to supply the audit report and invoices without justifying limitation of the Claimant's right of access to information, and could have redacted sensitive material. Expressions in the suspension and hearing letters suggested a predetermined outcome, rendering the hearing cosmetic.
Appropriateness of reinstatement
Reinstatement was declined as impractical for a senior employee amid a breakdown of trust, and maximum compensation of twelve months' gross salary was awarded instead
Guided by Section 49(3) and (4) of the Employment Act and the Kenya Airways case, the Court noted the common law reluctance to order specific performance of personal service contracts, the seniority of the Claimant's position, and the Respondent's assertion of irretrievable loss of trust. Compensation of twelve months' gross salary was considered adequate, taking into account the length of service, the failure to prove valid reasons, and future employment prospects.
Whether constitutional damages could be separately awarded
The claim for general damages of Kshs 20 million for constitutional violations was declined
Relying on GMV v Bank of Africa and the South African decision in Le Monde Luggage, the Court held that compensation is meant to make good the employee's loss, not punish the employer, and maximum compensatory award suffices without a separate constitutional damages award.
Legal principles established
#- An employer must prove the reasons for termination on a balance of probabilities under Sections 43(1) and 45(2) of the Employment Act
- A fair disciplinary process requires adequate notice, comprehensive particulars of allegations, and access to the documents relied upon by the employer
- Mere issuance of a show cause letter and holding a hearing does not by itself constitute a fair hearing
- Separate general damages for constitutional violations are not warranted where compensation for unfair termination has been awarded
Court orders
#- 1.A declaration that the Claimant's termination from employment was unfair and unlawful
- 2.Compensatory damages awarded to the Claimant in the sum of Kshs 3,430,800.00 being equivalent to twelve (12) months of her gross salary
- 3.Interest on the amount in (b) at court rates from the date of Judgment until payment in full
- 4.The Claimant shall have the costs of the suit
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 and Articles 35, 41 and 47 of the Constitution of Kenya, 2010
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kinyanjui v Rural Electrification & Renewable Corporation (Cause E709 of 2022) [2024] KEELRC 1824 (KLR)", Case Analysis (2024). Cause No E709 of 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1824/eng@2024-07-12
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.