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ELRCDismissedNot stated in the judgment (Employment and Labour Relations Court claim and counterclaim)

Macharia v Cellulant Kenya Limited (Cause E6514 of 2020) [2025] KEELRC 466 (KLR)

Employment and Labour Relations Court
21 February 2025
2,316 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~9 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court upheld Cellulant's dismissal of an employee facing theft charges, but refused to make her repay the disputed millions without proof of her exact share.

What this practically means

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Executive summary

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The claimant, employed as a Content Developer from August 2015, was suspended on 17.04.2019 amid suspected fraud, charged in a criminal case at Kibera for stealing by servant and related offences involving approximately Kshs. 13.6 million channelled to her own and her brother's accounts under the guise of payments to Skiza Tunes artists, and was summarily dismissed by letter dated 30.05.2019 after twice declining to attend disciplinary hearings. She sued for declarations that the dismissal was unlawful, unfair and inhuman, plus terminal dues of Kshs. 8,380,500.00 (notice pay, 12 months' compensation, house allowance and service gratuity), interest and costs. The respondent defended the dismissal as lawful and counterclaimed for Kshs. 13,621,299/=. The Court held the order cited by the claimant did not bar her from attending the disciplinary hearing; criminal proceedings did not bar disciplinary proceedings; her admitted role in preparing a payment list including a non-artist brother as beneficiary grounded valid reason; and the dismissal procedure complied with sections 41, 43, 44(4)(g) and 45 of the Employment Act. The counterclaim failed because the liquidated sum was not strictly proved, no cash was recovered, and the criminal judgment did not apportion liability between the two accused. The admitted house allowance of Kshs. 469,950.00 operated only as a set-off. Both claim and counterclaim were dismissed, with each party bearing own costs. Judgment signed, dated and delivered on 21 February 2025 by Byram Ongaya, Principal Judge.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the summary dismissal of the claimant was unfair in procedure and in substance, including whether the pending criminal case barred or should have deferred the disciplinary process
  2. 2.Whether the claimant was entitled to terminal dues of Kshs. 8,380,500.00 comprising notice pay, 12 months' compensation, house allowance and service gratuity
  3. 3.Whether the claim for house allowance was time-barred under section 89 of the Employment Act
  4. 4.Whether the respondent's counterclaim to recover Kshs. 13,621,299/= from the claimant was established

Key legal issues

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01

Fairness of the summary dismissal procedure and reason

Holding

The dismissal was procedurally fair and substantively justified under sections 41, 43, 44(4)(g) and 45 of the Employment Act

Reasoning

The Court found the court order the claimant relied on did not bar attendance at the disciplinary hearing. Criminal charges constituted well-founded reasonable suspicion under section 44(4)(g). The claimant admitted preparing a payment list including her brother, a non-artist, as a beneficiary. Notice and hearing opportunities were given, and the reason for dismissal was valid and fair.

p. 4
02

Whether the pending criminal case barred or should have deferred the disciplinary process

Holding

No - criminal proceedings do not bar disciplinary proceedings, and the claimant had no valid reason to skip the hearing

Reasoning

The Court considered the claimant's reliance on the criminal-case order to avoid the hearing and held there was no valid reason founded on that order for non-attendance. She acknowledged that a criminal case differs from a disciplinary case, and the respondent had accommodated her on suspension with pay throughout.

p. 4
03

The respondent's counterclaim for Kshs. 13,621,299/=

Holding

The counterclaim failed; the liquidated claim was not strictly proved and the criminal judgment did not apportion liability between the two accused

Reasoning

The respondent's witness confirmed no cash was recovered from the claimant's accounts and no artist complained of non-payment. The criminal judgment directed refund without apportioning amounts between the accused, with a civil suit to be filed. The respondent failed to establish the extent of the claimant's individual liability and the sum she should pay, making a joint award unjustified.

p. 5
04

House allowance claim and limitation

Holding

The admitted Kshs. 469,950.00 was not payable in cash but operated as a set-off against the amounts the claimant was found partly liable for stealing

Reasoning

The respondent argued the claim was time-barred under section 90 but pleaded and admitted Kshs. 469,950.00 on a pro-rata computation. The Court allowed that amount only as a set-off against the stealing liability found in the criminal judgment, balancing justice between the parties.

p. 5

Legal principles established

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  • Pending criminal proceedings do not bar an employer from conducting disciplinary proceedings against an employee
  • A liquidated claim must be strictly proved on a balance of probability, and joint criminal liability must be apportioned before individual civil liability can be enforced
  • An employer may summarily dismiss under section 44(4)(g) of the Employment Act upon reasonable suspicion that the employee committed a criminal offence against the employer's substantial detriment

Court orders

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  1. 1.Dismissal of the claimant's claim
  2. 2.Dismissal of the respondent's counterclaim
  3. 3.Each party to bear own costs of the claim and counterclaim

The bench

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One judgment of the whole court — no separate or dissenting opinions.

BO
Byram OngayaPrincipal Judge
majority

Wrote the judgment

Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 over the summary dismissal, terminal dues claim and counterclaim

Relief refused

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Declaration that the summary dismissal was unlawful, unfair and inhuman, and terminal dues of Kshs. 8,380,500.00 with interest and costs

The Court found the procedure fair and the reason for dismissal valid and fair; the summary dismissal was not unfair either in procedure or substance

p. 4

Claimant's claim for house allowance of Kshs. 469,950.00 as actual payment

The admitted amount was treated only as a set-off against the amounts the claimant was found partly liable for stealing, and not actually payable

p. 5

Respondent's counterclaim for Kshs. 13,621,299/= plus interest

The liquidated claim was not strictly proved and the respondent failed to establish the claimant's individual liability and the amount she should pay

p. 5

Costs

Each party to bear own costs of the claim and counterclaim

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

In conclusion judgment is accordingly entered for the parties for dismissal of both the counterclaim and claim and each party to bear own costs of the proceedings.
p. 5Final orders - dismissal of both claim and counterclaim with each party bearing own costs
The Court finds that the procedure adopted to dismiss the claimant was fair per section 41 and 45 of the Act. Further, the respondent has established that the reason of dismissal was valid and fair per sections 43 and 45 of the Act.
p. 4Fairness of summary dismissal under the Employment Act
On a balance of probability, the Court finds that the claimant has failed to strictly prove the liquidated claim as per applicable trite law.
p. 5Standard of proof for liquidated claims in civil proceedings
Holding her liable to pay all the amount as claimed and as prayed for is found unjustified.
p. 5Apportionment of liability between jointly accused persons

Issues in the judgment

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minor

The judgment inconsistently refers to the claimant's gender, using both 'he/him' and 'she/her' in describing the same person's evidence

minor

The judgment refers to the criminal case inconsistently, citing Criminal Case No. 216 of 2019 in one place and Kibera Criminal Case 550 of 2019 in another for what appears to be the same prosecution

minor

The alleged stolen amount varies between Kshs. 13,856,849.00 and Kshs. 13,621,299/= within the judgment

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, "Macharia v Cellulant Kenya Limited (Cause E6514 of 2020) [2025] KEELRC 466 (KLR)", Case Analysis (2025). Not stated in the judgment (Employment and Labour Relations Court claim and counterclaim). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/466/eng@2025-02-21

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