Mwangi v Nairobi Academy (Employment and Labour Relations Appeal E028 of 2024) [2025] KEELRC 663 (KLR)
The bottom line
#A Kenyan court ruled that even an employee caught stealing can win a unfair-termination case if the employer skips the required disciplinary procedure, though his compensation was denied.
What this practically means
#Executive summary
#Key legal issues
#Whether the trial court erred in finding unfair termination
Unfair termination upheld. The theft reason met the threshold of section 43 (appellant admitted culpability in a signed confession and benefited from its withdrawal of the police case), but the absconding reason was not proved as no show cause notice was issued, and section 41 procedure was not complied with.
On re-evaluation, the confession letter of 25th August 2019 led to the appellant's release from police custody and withdrawal of the criminal case; his claim of coercion was an afterthought since he never retracted it even at the disciplinary hearing. However, the employer did not issue a show cause notice on the absconding ground nor take steps under section 41 to end the employment, so the termination remained procedurally unfair on that reason.
Whether the award of 5 months' salary as compensation was excessive
Compensation set aside entirely because the appellant admitted the theft; notice pay sufficed under section 49 of the Employment Act.
Although the termination was procedurally unfair on the absconding reason, the appellant's admitted culpability for the theft disentitled him to compensatory damages. The court applied the ex turpi causa principle raised by the cross-appellant, holding that reward for the employee's own wrong was not warranted, and that notice pay was the adequate remedy under section 49.
Whether the appellant was entitled to service gratuity under the CBA despite NSSF membership
Yes. Clause 18(b) of the CBA was legally binding; the appellant, having served 23 years and been terminated for reasons other than gross misconduct, was awarded Kshs. 894,012.30 (one month's salary per completed year).
Section 26 of the Employment Act allows CBAs to provide terms more favourable than the statutory minimum; NSSF membership under section 35(6) does not exclude a gratuity scheme established under a CBA. Clause 18(c) of the CBA stated a pension scheme would supersede the gratuity clause once agreed, but no evidence of such a scheme existed, so the gratuity clause remained binding.
The award of unpaid salary for August and September 2019
Upheld; it was not disputed that the last day at work was 9th September 2019.
The court found no basis to disturb the trial court's award of unpaid salary for the month of August 2019 and the nine days worked in September 2019, as the fact that the appellant last attended employment on 9th September 2019 was undisputed.
Legal principles established
#- Where an employee absconds, the employer must reach out and issue a show cause notice before terminating employment under sections 41 and 44(4)(a) of the Employment Act; failure renders the termination unfair.
- A CBA with more favourable terms than the statutory basic minimum prevails; NSSF membership does not defeat a gratuity entitlement created under a CBA.
- An employer who genuinely believed reasons for termination existed at the time satisfies section 43(2) of the Employment Act.
Court orders
#- 1.Declaration that the claimant's termination was both procedurally and substantially unfair
- 2.Four (4) months salary in lieu of notice of Kshs. 155,480
- 3.Unpaid salary for the month of August 2019 of Kshs. 38,870.10
- 4.Unpaid salary of 9 days of September 2019 of Kshs. 14,576.29
- 5.Service gratuity of Kshs. 894,012.30, total sum Kshs. 1,102,938.69 payable subject to statutory deductions
- 6.Costs and interest at court rate from the date of judgment until payment in full
- 7.Each party to bear own costs at appeal and cross-appeal
- 8.Stay of 30 days
- On appeal from
- Chief Magistrates Court at Nairobi (Milimani), ELRC Cause No. 2145 of 2019
- Milimani CMEL No. 2145 of 2019
- Jurisdiction invoked
- First appellate jurisdiction of the Employment and Labour Relations Court over decisions of the magistrates' court in employment causes
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Mwangi v Nairobi Academy (Employment and Labour Relations Appeal E028 of 2024) [2025] KEELRC 663 (KLR)", Case Analysis (2025). ELRCA No. E28 of 2024 (consolidated with ELRC Appeal No. E050 of 2024). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/663/eng@2025-02-28
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.