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ELRCDismissedCause No E482 of 2023· [2025] KEELRC 850 (KLR)

Miringu v Family Bank Limied (Cause E482 of 2023) [2025] KEELRC 850 (KLR)

Employment and Labour Relations Court
14 March 2025
SRStella Rutto
3,513 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court upheld a bank's dismissal of an operations manager, finding negligence in failing to reconcile accounts was a valid, fairly handled reason for termination.

What this practically means

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Executive summary

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The Claimant, formerly employed by the Respondent bank as Operations Manager from 8th April 2008, sued challenging the termination of his employment by letter dated 8th November 2021. He sought declarations that the termination was wrongful, unfair and unlawful and violated Articles 41, 47 and 27 of the Constitution, plus 12 months' compensation, six months' notice pay, gratuity, compensation until retirement age, general damages and costs. He asserted he was victimised for being a whistleblower who exposed fraud by Ceven Limited, a vendor of pre-paid electricity tokens. The Respondent maintained the Claimant was negligent in failing to reconcile the vendor's account, exposing the Bank to a loss of about Kshs 200 million, and that termination was for a valid reason and procedurally fair. The court framed three issues: valid reason, fair process, and reliefs. On evidence, the court found reconciliation of DFS operations accounts was squarely within the Claimant's job description; the fraud ran from March 2018 to December 2020 and the Claimant flagged it late, his earlier requests for statements being for audit purposes. It held the employer genuinely believed the Claimant negligent, satisfying Sections 43 and 45(2) of the Employment Act. On process, the show cause letter, written response and disciplinary hearing satisfied Section 41. The claim for gratuity failed as there was no contractual provision and the Claimant had accessed his pension. The Claim was dismissed in its entirety with each party bearing its own costs. Judgment was delivered by Stella Rutto, J, in Nairobi on 14th March 2025.

Key legal issues

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01

Valid and fair reason for termination

Holding

The Respondent proved on a balance of probabilities that the Claimant was negligent in failing to reconcile the DFS operations accounts, exposing the Bank to a loss of approximately Kshs 193 million

Reasoning

The Claimant's job description included reconciliations of DFS operations accounts. The fraud occurred between March 2018 and December 2020 and the Claimant only flagged it in May 2020, and his earlier requests for statements were for audit purposes. Had he reconciled regularly, the fraud would likely have been detected early. His negligence led the employer to genuinely believe he was imprudent.

p. 6
02

Procedural fairness

Holding

The Respondent complied with Section 41 of the Employment Act by issuing a show cause letter, receiving a response, and holding a disciplinary hearing at which the Claimant was heard and could be accompanied

Reasoning

The Claimant received a Notice to Show Cause setting out the allegations, responded in writing, was invited to a disciplinary hearing with advice of his right to be accompanied by a witness, and appeared and gave his side. The court was persuaded the process was fair.

p. 7
03

Entitlement to reliefs

Holding

Having found the termination fair and lawful, none of the reliefs sought were payable, including gratuity which had no contractual basis

Reasoning

Notice pay and compensatory damages fail with the finding of fairness; the retirement-age compensation also fails; gratuity was not contractually provided and the Claimant was a member of the pension scheme whose contributions he had accessed.

p. 7

Legal principles established

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  • The reason for termination is what the employer genuinely believed to exist at the time of termination, proved on a balance of probability
  • Section 41 of the Employment Act requires an employer to explain reasons to the employee, allow representation and hear representations before termination

Court orders

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  1. 1.The Claim is dismissed in its entirety
  2. 2.Each party shall bear its own costs

Authorities

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Legislation

  • Constitution of Kenya, 2010Articles 41, 47, 27, 159(2)(d), 48
  • Employment ActSections 41, 43, 43(2), 45(2)(a) & (b), 45(2)(c)
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B

Cases cited (5)

  • Evans Kamadi Misango v Barclays Bank of Kenya Limited
    [2015] eKLR
  • Joseph Mwaniki Nganga v United Millers Limited
    [2022] eKLR
  • Walter Ogal Anuro v Teachers Service Commission
    [2013] eKLR
  • George Musamali v G4S Security Services Kenya Ltd
    [2016] eKLR
  • National Bank of Kenya vs Anthony Njue John
    [2019] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act (Sections 41, 43, 45)

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, "Miringu v Family Bank Limied (Cause E482 of 2023) [2025] KEELRC 850 (KLR)", Case Analysis (2025). Cause No E482 of 2023. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/850/eng@2025-03-14

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