Bolo v SBM Bank Limited (Cause 757 of 2019) [2024] KEELRC 2485 (KLR)
The bottom line
#SBM Bank must pay a former HR officer over Kshs 1.4 million because it fired her unfairly, with her accuser sitting on the disciplinary panel.
What this practically means
#Executive summary
#Key legal issues
#Whether the termination was substantively fair - validity of the reasons
The reasons (sharing the redundancy email with the Legal Manager and signing recommendation letters as HRM) were invalid; the email was shared internally before the caution, and the Claimant signed recommendation letters in the course of discharging HR functions
The email advising non-disclosure was sent at about 9:00 pm, after the Claimant had already shared the redundancy email internally with the Legal Manager, who was not an outsider. On the recommendation letters, the Claimant was the only HR officer at take-over, reported to the MD per her appointment letter, and no letter re-designated her. Termination on either account was insufficient and hence invalid under section 43 of the Employment Act.
Whether the termination was procedurally fair under section 41 of the Employment Act
The procedure was unfair: Ms. Ogonji, the accuser, constituted and sat on the disciplinary panel in breach of the Respondent's HR Policy clause 17; the Claimant's concerns were omitted from the minutes; and the termination letter was dated 24th July 2018, before the hearing
Section 41 mandatorily requires the employer to explain reasons and hear the employee. Ms. Ogonji, who sent the impugned email and signed the suspension and termination letters, constituted the panel and participated despite her conflict. The court also found it curious that the termination letter, certificate of service and full and final settlement letter were all dated a month before the hearing, and that the settlement letter recorded a resignation that never happened, lending plausibility to the allegation of a forced exit.
Whether the constitutional and statutory rights of the Claimant were breached
Claim for breach of Articles 27, 28, 41, 47 and 50(1) and section 5 of the Employment Act rejected for failure to plead and prove violations with precision
Relying on the Anarita Karimi Njeru standard as restated in Mumo Matemu, the court held that constitutional violations must be pleaded with precision and proved; not every termination is a constitutional breach. Only conduct so egregious that no reasonable employer would embark on it in the guise of termination meets the threshold, which was not demonstrated here.
Reliefs - compensation and the Respondent's counterclaim
Reinstatement unavailable; maximum 12 months' salary awarded under section 49; the admitted loan counterclaim of Kshs 248,389/= allowed and set off
Having found unfair termination, the court considered section 49 factors including the 2014-2018 tenure and manner of termination, and awarded the maximum 12 months' compensation despite having earlier indicated a 6-month award. Reinstatement lapsed under section 12(3)(vii) ELRC Act. The admitted outstanding staff loan was allowed as a set-off against the award.
Legal principles established
#- Termination of employment requires both substantive and procedural fairness; failure to justify grounds under section 43 renders termination unfair under section 45 of the Employment Act
- A person who is the accuser cannot sit on the disciplinary panel determining the accusation - the rule against bias in disciplinary proceedings
- Disciplinary sanction must be proportionate to the misconduct; termination is not warranted where softer options such as a warning exist
- Allegations of constitutional violation in employment claims must be pleaded with precision and the acts complained of must be egregious
Court orders
#- 1.Award of 12 months' salary as compensation for unfair termination of Kshs 1,711,284/= less the Respondent's counterclaim set-off of Kshs 248,389/=, totalling Kshs 1,462,445/=
- 2.The award subject to applicable taxes and statutory deductions
- 3.Interest on the award at court rates from the date of judgment until payment in full
- 4.Costs to the Claimant
- Jurisdiction invoked
- Articles 27, 28, 41, 47 and 50(1) of the Constitution read with sections 5(1)(a)(2), 41, 43, 45, 47(5), 49 and 50 of the Employment Act and section 12(3)(vii) of the Employment and Labour Relations Court Act
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Bolo v SBM Bank Limited (Cause 757 of 2019) [2024] KEELRC 2485 (KLR)", Case Analysis (2024). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2485/eng@2024-10-11
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.