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ELRCPartially AllowedNot stated in judgment (Memorandum of Claim dated 30th November, 2023)· [2024] KEELRC 2066 (KLR)

Ngeno v AIC Litein Hospital (Employment and Labour Relations Cause E059 of 2023) [2024] KEELRC 2066 (KLR)

Employment and Labour Relations Court
25 July 2024
HWHellen Wasilwa
4,999 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan hospital was ordered to pay a former employee over Kshs 522,000 because it fired him without giving reasons or a fair hearing.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent as a Programme Site Coordinator from 1st October 2020 on successive fixed-term contracts, was terminated on 26th October 2023, roughly a year before the expiry of his second two-year contract, following allegations that he prepared and approved petty cash vouchers for transport reimbursement of 70 patients when only 34 attended a clinic activity, occasioning a loss of Kshs 14,400. The Respondent counterclaimed for the Kshs 14,400 and a work laptop valued at Kshs 45,000. The Claimant sought a declaration that the termination was unlawful, damages of Kshs 1,395,170.59, interest, a certificate of service and costs. The court framed two issues: whether the termination was fair and justified, and the remedies due. It found the termination letter stated no reasons for the dismissal, making it impossible to discern whether valid reasons existed, and that the disciplinary hearing minutes disclosed no witness testimony or evidence from the Claimant on the allegations, breaching section 41 of the Employment Act. Under section 45(2), both valid reasons and a fair hearing are required, so the dismissal was unfair and unjustified. The court awarded six months' salary as compensation, given twelve months of the contract remained unspent, plus gratuity on the two-year contract, totalling Kshs 522,081.84 less statutory deductions, with costs and interest to the Claimant. The Respondent's limitation arguments on house allowance, leave and service pay claims were not ultimately decisive in the awards made.

Key legal issues

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01

Whether the termination of the Claimant's employment was substantively and procedurally fair

Holding

The dismissal was unfair and unjustified: the termination letter gave no reasons, and the disciplinary process did not comply with section 41 of the Employment Act

Reasoning

The termination letter dated 26th October 2023 stated no reasons for termination, making it impossible to discern whether valid reasons existed. The disciplinary hearing minutes showed no witness was called to testify and no indication the Claimant was asked to give his evidence on the allegations. Section 45(2) requires both valid reasons and a fair hearing; the disciplinary process was flawed.

p. 10
02

Whether the Claimant is entitled to remedies

Holding

Claimant awarded 6 months' salary as compensation for unfair termination and gratuity on the 2-year contract

Reasoning

Having found the dismissal unfair, the court awarded compensation equivalent to 6 months' salary given 12 months of the contract remained unspent, plus gratuity at 10% of basic salary over 24 months, less statutory deductions, with costs and interest.

p. 10

Legal principles established

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  • For a fair dismissal there must be both valid reasons and a fair hearing, and where the dismissal letter does not state reasons the court cannot discern validity of reasons

Court orders

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  1. 1.Award of 6 months' salary as compensation for unfair termination (Kshs 356,487.60), given 12 months of the contract remained unspent
  2. 2.Award of gratuity on the 2-year contract (Kshs 165,594.24)
  3. 3.Total award of Kshs 522,081.84 less statutory deductions
  4. 4.Respondent to pay costs of the suit plus interest at court rates from the date of judgment
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (sections 41, 43, 45, 47(5), 51 and 90 cited)

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, "Ngeno v AIC Litein Hospital (Employment and Labour Relations Cause E059 of 2023) [2024] KEELRC 2066 (KLR)", Case Analysis (2024). Not stated in judgment (Memorandum of Claim dated 30th November, 2023). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2066/eng@2024-07-25

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