Nyamota v Kariobangi Owners Sacoo Limited (Employment and Labour Relations Cause E700 of 2022) [2025] KEELRC 1541 (KLR)
The bottom line
#A Kenyan SACCO fired a cashier without a hearing, failed to prove he stole money, and was ordered to pay him Kshs. 312,000 plus costs.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the Claimant was unlawfully terminated or deserted duty
- 2.Whether the Respondent has established its counterclaim for Kshs. 731,650.00
- 3.Whether the Claimant is entitled to the reliefs sought
- 4.Who should bear the costs of the suit
Key legal issues
#Whether the dismissal was lawful and procedurally fair
The dismissal was unfair and unjustified; the Respondent failed to subject the Claimant to any disciplinary process and failed to prove the loss of funds was attributable to him
RW1 confirmed a disciplinary procedure existed but was not followed, and the power to sack lay with the Board. The audit was conducted after the alleged dismissal, the bank slips were filled by another employee, and the office file was not in the Claimant's custody. The Respondent also failed to show efforts to trace the Claimant, having reported him to police and knowing his whereabouts. The audit report did not find the Claimant culpable.
Whether the Respondent proved desertion
The desertion claim failed; the Respondent did not demonstrate measures taken to find and trace the Claimant, and their police report showed they knew where he was
The Respondent reported the matter to police and the Claimant was arrested, showing they knew his location, contradicting the desertion narrative. No evidence of attempts to reach the Claimant was adduced beyond bare assertion, and the disciplinary process contemplated was never carried out.
Whether the Respondent established the counterclaim for Kshs. 731,650
The counterclaim failed; the Respondent failed to prove the alleged loss was stolen by the Claimant, as the audit report did not find him culpable
The forensic auditor testified he was instructed to audit monies not accounted for and reviewed daily collections summaries, bank slips and bank statements, but was not checking who banked. The bank slips were filled by Reinhard, not the Claimant. The figures were unsubstantiated and the bank statements relied on were not produced in court. The discrepancies in figures pleaded (Kshs. 900,000 in the police report, Kshs. 600,000 in the demand letter, Kshs. 731,650 in the counterclaim) undermined credibility.
What remedies are due to the Claimant
Notice pay of one month, 10 months' compensation for unfair dismissal, one year's leave not taken, and a certificate of service were awarded
Given the dismissal without any hearing, the court exercised discretion under Sections 41 and 45 of the Employment Act to award compensation. Salary arrears were refused as they are attendant to reinstatement which was not sought. Service pay was refused for want of pleading and proof of non-membership of NSSF.
Legal principles established
#- An employer must, before terminating employment on grounds of misconduct, explain the reasons to the employee and hear and consider any representations, per Section 41 of the Employment Act
- Termination is unfair where the employer fails to prove a valid and fair reason and that fair procedure was followed, per Section 45(2) of the Employment Act
- An employer alleging desertion must show efforts made towards reaching out to the employee and putting them on notice of contemplated termination
Court orders
#- 1.One month salary in lieu of notice of Kshs. 26,000
- 2.Ten months' compensation for unfair dismissal being 10 x Kshs. 26,000 = Kshs. 260,000
- 3.One year's leave not taken granted as leave equal to Kshs. 26,000
- 4.Total award of Kshs. 312,000 less statutory deductions
- 5.The Respondent to issue the Claimant with a certificate of service
- 6.The Respondent to pay costs of the suit plus interest at court rates from the date of judgment
- 7.The Claimant's claim for salary arrears and general damages not granted; the Counterclaim dismissed
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act 2007 (employment dispute)
Relief refused
#Salary arrears for the entire period out of employment since July 2022
Salary arrears are an attendant relief to reinstatement, which was not sought; awarding them would amount to unjust enrichment
General damages
Not granted in the final remedies
Maximum 12 months' compensation
Court awarded 10 months instead, citing dismissal without any hearing
Service pay
Not pleaded nor established that the Claimant was not a member of NSSF or that statutory deductions were not remitted
Respondent's counterclaim for Kshs. 731,650
Respondent failed to prove the loss was stolen by the Claimant and failed to follow a disciplinary process; the audit report did not find the Claimant culpable
Costs
The Respondents will pay costs of this suit plus interest at court rates with effect from the date of this judgment
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
The Respondent having failed to prove that the Claimant was responsible for the loss and having also failed to take him through a disciplinary process, I find the dismissal unfair and unjustified. The counter claim fails also for the same reason.
In view of the fact that he was dismissed without any hearing, I will also award him 10 months compensation for the unfair dismissal = 10x26,000 = 260,000/=.
The Respondents will pay costs of this suit plus interest at court rates with efiect from the date of this judgment.
an employer shall, before terminating the employment of an employee, on the grounds of misconduct, poor performance or physical incapacity explain to the employee, in a language the employee understands, the reason for which the employer is considering termination
A termination of employment by an employer is unfair if the employer fails to prove(a) that the reason for the termination is valid;
Issues in the judgment
#The Respondent's pleadings and submissions give inconsistent figures for the alleged unaccounted money - Kshs. 731,560 in one paragraph and Kshs. 731,650 elsewhere
The Respondent's submissions state the Notice to Show Cause was issued on 1st August 2024, which conflicts with the show cause letter dated 1st August 2022 referenced elsewhere
Judgment does not state the case number, and the record contains OCR/typographical errors ('ofice', 'efiect', 'auditoe', 'collision' for collusion)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Nyamota v Kariobangi Owners Sacoo Limited (Employment and Labour Relations Cause E700 of 2022) [2025] KEELRC 1541 (KLR)", Case Analysis (2025). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1541/eng@2025-05-28
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.