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ELRCPartially AllowedNot stated in judgment· [2025] KEELRC 158 (KLR)

Okweh v I&M Bank Limited (Cause E510 of 2021) [2025] KEELRC 158 (KLR)

Employment and Labour Relations Court
31 January 2025
JRJames Rika
3,754 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan bank manager's unfair dismissal claim failed because the court found his sacking for a Kshs. 27 million vault loss was fair; he only got a certificate of service.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent Bank from 17th August 2010 and last serving as Branch Operations Manager at Kisii, was summarily dismissed on 31st January 2019 following discovery of a shortage of over Kshs. 27 million in the branch cash vault and ATM, where 100-denomination notes were disguised as 1,000-denomination notes. He sued seeking declarations of breach of Section 41 of the Employment Act and constitutional articles, compensation of 12 months' salary, notice pay, half-salary for the suspension period, relief on his credit facility, damages, certificate of service, costs and interest. The Respondent maintained that the Claimant was the joint custodian of the vault, was subjected to a disciplinary hearing at Nairobi, and was fairly dismissed for gross misconduct under Section 44(3). The Court framed three issues: whether a discharge voucher barred the claim, whether termination was procedurally and substantively fair, and remedies. It found the discharge voucher covered only pension dues paid by a Pension Scheme separate from the employer, so the claim was properly before the Court. The dismissal was held procedurally fair - phone notification and the composition of the committee caused no discernible disadvantage - and substantively justified, the Claimant having been joint custodian of the vault and the loss being attributable to his knowledge, negligence or participation. Only the certificate of service issued; all other prayers were declined and costs were awarded to the Respondent. Judgment delivered by James Rika, Judge, on 31st January 2025.

Key legal issues

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01

Whether the discharge voucher barred the Claim

Holding

The discharge voucher exhibited related to pension dues paid by the Pension Scheme, a separate entity, not terminal benefits from the employer; the Claim was therefore validly filed

Reasoning

The Court of Appeal authorities on enforcing discharge vouchers were acknowledged, but the evidence showed the voucher covered payment of Kshs. 1,835,422 from the Respondent's Pension Scheme, which was separate from the contract of employment. The discharge did not relate to the employment relationship, so the Court retained jurisdiction to examine the fairness of dismissal.

p. 6
02

Whether termination was procedurally fair under Sections 41 and 45 of the Employment Act

Holding

Procedurally fair

Reasoning

The Claimant was suspended, notified of the hearing, attended and was heard by an inter-departmental committee, responded to questions, and did not complain of being denied the right to be accompanied or to call witnesses. Notification by phone and a 2-month delay between recommendation and dismissal placed him at no discernible disadvantage.

p. 6
03

Whether there was valid and fair reason for termination under Section 43

Holding

Yes, the Respondent had adequate proof of the reason for termination

Reasoning

The Claimant was Operations Manager and joint custodian of the vault; audits and investigations confirmed a loss of over Kshs. 27 million through disguised cash denominations. As the officer overseeing cash officers and tellers, and holding vault keys, the loss was attributable to his knowledge, negligence, or participation.

p. 7
04

Whether the Claimant was summarily dismissed for gross misconduct under Section 44(3)

Holding

Dismissal was well-founded on the fraud-related gross misconduct

Reasoning

The Respondent pleaded Section 44(3) gross misconduct. The Court found the cash vault loss of over Kshs. 27 million was traceable to the Claimant's negligence or active involvement, justifying summary dismissal under Sections 41, 43, 44, 45 and 46 of the Employment Act.

p. 8

Legal principles established

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  • A discharge voucher signed for pension dues paid by a Pension Scheme, being a separate entity from the employer, does not bar an employee from filing a claim arising from the contract of employment
  • An employee who does not execute a discharge voucher is not barred, and the Court remains entitled to examine procedural and substantive fairness of termination
  • Notification of a disciplinary hearing by phone rather than in writing, and the fact that a committee did not style itself a disciplinary committee, do not by themselves amount to procedural unfairness under Sections 41 and 45 of the Employment Act
  • A shift of blame to junior employees may raise reasonable doubt in criminal jurisdiction but is insignificant in the employment jurisdiction

Court orders

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  1. 1.The Respondent shall issue the Claimant, his certificate of service
  2. 2.The rest of the Claim is declined
  3. 3.Costs to the Respondent
Jurisdiction invoked
Employment and Labour Relations Court, first-instance employment claim under the Employment Act 2007

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, "Okweh v I&M Bank Limited (Cause E510 of 2021) [2025] KEELRC 158 (KLR)", Case Analysis (2025). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/158/eng@2025-01-31

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