Mwangi v Cooperative Bank of Kenya Limited (Cause 1480 of 2018) [2025] KEELRC 456 (KLR)

The employer must prove reasons for termination under Section 43. The Claimant admitted in his response to the show cause letter that he borrowed Kshs. 1,200,000 from a colleague and failed to repay, and that his cheques were dishonoured. These acts contravened express clauses of the Employment Contract, Clause 19 of the Business Code of Conduct & Ethics, and Clause 28.9 of the Staff Manual, which classify pecuniary embarrassment and borrowing from unlicensed lenders as gross misconduct. Bank employees are held to a high degree of honesty and integrity.

Section 41 requires the employer to explain reasons and hear the employee's representations before termination. The Claimant was issued a show cause letter to which he responded, was invited to and attended a disciplinary hearing accompanied by Mohamed Hawshi of the Central Staff Committee, and exercised an appeal. His complaints of inadequate time and improper constitution of the Disciplinary Committee were unsupported by evidence.

The Claimant argued the loan recovery was a commercial matter outside the Court's jurisdiction. Relying on BIFU v Consolidated Bank and Abraham Nyambane Asiago, the Court held that disputes arising from staff loan agreements flowing from the employment relationship fall within employment and labour relations jurisdiction, avoiding fragmentation of disputes across different courts. The Claimant also admitted owing the sums claimed.