Peter K Kabau, Rajab Sumba & Samwel Awino v Riley Services Limited [2022] KEELRC 473 (KLR)

REPUBLIC OF KENYA

IN THE EMPLOYMENT AND LABOUR RELATIONS COURT

AT NAKURU

ELRC CAUSE NUMBER 48 OF 2015

PETER K. KABAU ................................................................1ST  CLAIMANT

RAJAB SUMBA ..................................................................2ND CLAIMANT

SAMWEL AWINO.............................................................3RD CLAIMANT

-VERSUS-

RILEY SERVICES LIMTED........................................... RESPONDENT

(BEFORE HON. JUSTICE DAVID NDERITU)

JUDGMENT

1.      INTRODUCTION

1.      In a Memorandum of Claim dated 16th February, 2015    the Claimants pray for:-

(a)     A declaration that the Claimants have been   unfairly terminated.

(b)     Reinstatement to their previous employment or

(c)     In the alternative to (b) above compensation for           unfair termination.

(d)     payment of all their terminal benefits.

(e)     Payment of all sums calculated as underpayment                   in salary and other allowances.

(f)     Costs of this claim.

2.     Along with the Statement of claim were filed verifying    affidavits sworn by all the Claimants, a list of documents     and copies thereof.

3.      Upon service, the Respondent entered appearance on 16th         April, 2015 and filed a Statement of response on 19th        July, 2017.  Along with the response were filed copies of     several documents.

4.      This cause came up in court for hearing on 17th November,      2021 when the 1st Claimant, PETER KABAU (CW1),      testified on his own behalf and on behalf of the other       Claimants.  On the same date JONATHAN MUSOMBA           (RW1) testified for and on behalf of the Respondent.

5.      By consent of counsel for both parties written submissions      were filed, Claimant’s on 18th and Respondent’s on 25th January, 2022.

II       CLAIMANTS’ CASE

6.      In a nutshell, the Claimants’ cause is that they were all     employees of the Respondent (the 1st Claimant being a     supervisor) working as security guards.

7.      It is alleged that on or about 19th February, 2012 theft     occurred at the premises of one of Respondent’s clients          whereby goods belonging to UNGA FARM CARE     LIMITED, a client of the Respondent, were lost while the           Claimants were on duty.  The Respondent took the view         that the Claimants were involved in the said theft.

8.      The Claimants were subsequently jointly charged with the       said theft or related charges in Nakuru CMCC No. 651    of 2012 but they were subsequently acquitted or         discharged.  They pleaded their innocence even during the           trial in the testimony of CW1.

9.     The Claimants allege that they were not issued with         notices of termination, that they were not given a hearing,       were not allowed back to work, and that they have not          been paid their dues.  The Claimants’ case is that they have been constructively terminated unfairly and unlawfully and hence their prayers as set out above.

III.    RESPONDENT’S CASE

10.    The Respondent admits that the Claimants are its former           employees but categorically states that all the three       Claimants were fairly and procedurally dismissed   summarily for gross misconduct in that they engaged in            criminal conduct, whereby 245 bags of Indian Soya maize   meal valued at Kshs.3,000/= per bag were illegally offloaded /stolen from the businesses premises of Unga           Limited, a client of the Respondent.

11.    The Respondent alleges that the Claimants acted in          collusion and later on shared the proceeds of the crime       after disposing the stolen goods.

12.    The Respondent further alleges that the 1st Claimant was          not a good employee as he had allegedly sexually harassed      a female colleague at work as a result of which he had          earned a warning.

13.    The Respondent has advanced that the Claimants were    lawfully and procedurally dismissed and issued with letters         of summary dismissal based on their gross misconduct and   the Respondent prays that the entire claim by the claimants   be dismissed with costs.

IV     ISSUES FOR DETERMINATION

14.    Upon sifting through the pleadings, considering the         evidence adduced from both sides, and the written    submissions by Counsel for both parties, this court          considers the following to be the issues for determination:-

(i)      Was the dismissal of the Claimants by the       Respondent unfair and unlawful?

(ii)    If (i) above is in the affirmative are the Claimants   entitled to the reliefs sought?

(iii)   Costs.

V.      DISMISSAL

15.    Both sides agree that after the alleged theft took place on          the night of 18th/19th February, 2012 the Claimants never          worked for the Respondent again.  On the one hand the Claimants allege that they were not re-admitted to their place of work after release from police custody.  On the   other hand, the Respondent alleges that it summarily     dismissed the claimants for gross misconduct and issued          them with summary dismissal letters which the           Respondent produced as exhibits.  The respondent further       alleges that the Claimants’ dues     were calculated and     cheques drawn but the Claimants failed and or refused to         collect them.

16.    The Claimants have categorically denied involvement in          the alleged theft of the property of UNGA LIMITED, a   client of the Respondent.  To fortify their position, they      have through CW1 testified that they were acquitted in           Nakuru CMC Criminal Case No. 651 of 2012. Although        the proceedings in that criminal case were not produced as    exhibit in this cause, the Respondent has not denied that    the Claimants were acquitted or discharged of the theft     charges.

17.    It is also not clear what charges the Claimants were facing        in the criminal case. Were they accused of theft,   criminal     negligence, or neglect of duty?

18.    No evidence was adduced from UNGA LIMITED, the    complainant in the criminal case, to confirm exactly   how the criminal case ended.  What is not in dispute is that     after the alleged theft the Claimants lost their jobs with  the Respondent.  The contest is whether the manner in           which the claimants lost their jobs was fair and lawful.

19.    This court (ELRC) has emphasized on the need for both substantive and procedural fairness in termination of     employment in whatever manner may it be through      summary dismissal, redundancy, or any other method – see      the holdings in Mary Chemweno Vs Kenya Pipeline Company Ltd (2017) eKLR, Loice Otieno Vs Kenya       Commercial Bank Ltd (2013) eKLR,andWalter Anuro        Vs. Teachers Service Commission (2012) e KLR.

20.    Section 43 of the Employment Act (the Act) places a     burden on the employer to prove the reason for termination          and Sections 41, 45and47fortify the cardinal       importance of both substantive and procedural fairness   in           termination in whichever way.

VI     SUBSTANTIVE FAIRNESS

21.    It is by now clear that while the Claimants allege that they        were constructively dismissed, by the Respondent           refusing     to admit them back to work after the arrest and charging in court, the Respondent alleges that the Claimants were   summarily dismissed for gross misconduct.

22.    In his testimony CW2 on his own behalf and on behalf of        the other two Claimants did not inform the court whether   they received the letters of summary dismissal.  On the        other hand, RW1 for the Respondent stated that the           Claimants were handed the said letters and produced the           same as exhibits A, D, and E.

23.    The letter of dismissal to the 1st Claimant, exhibit A, is    dated 22nd February, 2012 while those  to the 2nd and 3rd          Claimants, exhibits D and E, are both dated 28th March,   2012.

24.    This court has given due consideration to the evidence    adduced by both sides, both oral and documentary, and has      come to the conclusion that the Claimants were summarily   dismissed in accordance with the letters mentioned above.

25.    Section 44(1) of the Act provides as follows:-

“Summary dismissal shall take place when an employer terminates the employment of an employee without notice or with less notice than that to which the employeee is entitled by any statutory provision or contractual term.”

Section 44(2) of the Act provides as follows:-

“Subject to the provisions of this section, no employer has the right to terminate a contract of service without notice or with less notice than that to which the employee is entitled by any statutory provision or contractual term.

26.    Section 44(4) provides for matters that may amount to    gross misconduct to justify the summary dismissal of an       employee for lawful cause. Section 44(4)(g) specifically    provides that where  “an employee commits, or on           reasonable and sufficient grounds is suspected of having       committed, a criminal offence against or to the          substantial detriment of his employer or his employer’s    property”the employer may rightfully and lawfully           summarily dismiss such an employee for gross        misconduct.

27.    The letter of summary dismissal to the 1st Claimant dated         22nd February, 2012 alludes to two instances of gross   misconduct on the part of the 1st Claimant.  One is on the      alleged theft on the night of 18th/19th February, 2012 which     the Respondent concluded that all the Claimants were involved in.  The second instance is an alleged case of         sexual harassment against a female employee

28.    Although the alleged female victim had allegedly recorded       a statement with the Respondent in respect of the incident,        she was not called as a witness in this cause.

29.    The Respondent carried out an investigation in respect of         the alleged theft led by RW1 and came to the conclusion          that all the three Claimants were in one way or another involved or connected to the theft.  RW1 prepared a report         on the incident and the said report was produced as an    exhibit.  The Claimants recorded statements in respect of    the alleged theft and they all denied involvement.      Nonetheless, the complainant in the matter UNGA           LIMITED reported the theft to police and all Claimants were arrested and charged in court in connection thereto.

30.    On a balance of probability, this court is of the opinion that     the Respondent had reasonable and sufficient grounds of      suspecting that the Claimants had committed a criminal      offence to its substantial detriment.  RW1testified that        after the alleged theft the Respondent lost the contract with           UNGA LIMITED.  This is the import, implication, and   application of Section 44(4)(g) of the Act.

31.    Flowing from the foregoing, this court holds that the       Respondent has demonstrated that it had a good reason for      summarily dismissing the Respondents to the standard          required by Section 43 of the Act.

32.    Like that of the 1st claimant, the letters of summary          dismissal to the 2nd and 3rd Claimants both dated 28th           March, 2012 indicate that they were dismissed for their       alleged involvement in the theft.  Clearly, the Respondent           had a prima facie reason to summarily dismiss the Claimants notwithstanding, as the court has been   informed,   that the Claimants were acquitted or discharged         of the charges by court for reasons that this court is not    able to establish as the proceedings in the criminal case   were not produced as  exhibit.

VII.   PROCEDURAL FAIRNESS

33.    As expressed in Part VI of this judgment above all employees are entitled to substantive and procedural fairness before dismissal or termination. There are           provisions in our laws that provide for procedural fairness       including Article 47 of the Constitution, Section 4 of the      Fair Administrative Actions Act, Sections 35, 41, 44,and45 of the Employment Act, rules of natural justice,       and equity.

34.    Some of the salient features of procedural fairness include                 the following:-

(i)      An employee shall be informed of the charges         or complaints against him/her in writing with     clear specifity.

(ii)    The employee shall be given ample/adequate           time to respond thereto and be assisted with      any documents or information that he/she may need to effectively respond to the charges, if such information or documents are in   possession of the employer.

(iii)   Where the employee needs interpretation       services in responding to the charges, he/she should be afforded the same by the employer.

(iv)   If upon response from the employee the         employer decides that the matter shall proceed          to hearing, the employee shall again be      afforded all the above services and informed of       the venue for the hearing on adequate notice.

(v)   The employee shall be informed of his/her right to come along with an employee of his/her  choice and a union representative if the employee is a member of a union.

(vi)   An employee shall be allowed and given an   opportunity to present his/her case and question any witness called, if he/she so desires.

(viii) The employee must be informed of the outcome of the disciplinary hearing and informed of his/her right of appeal and the procedure applicable.

35.  The foregoing are some of the ingredients of fair hearing. This list is not exhaustive.  Even where the disciplinary hearing does not conform 100% to the above steps, the  procedure adopted shall be fair and reasonable to afford an employee an opportunity to defend himself/herself and   demonstrate his innocence or otherwise.

36. Applying the foregoing principles to the facts of this cause   it is clear that the Claimants were not subjected to fair  hearing or fair procedural fairness before their dismissal. There is no evidence that the Claimants were served with clear statements of the charges/complaints, there is no  evidence that disciplinary hearings took place, there are no  minutes of the disciplinary hearings, and there is no evidence that the claimants were given an opportunity to appeal against the decision of summary dismissal against   them.

37.  Counsel for Respondent has relied on Kenya Revenue   Authority Vs Meninija Salim Murgam (2010) eKLRto  the effect that a hearing need not be oral or physical and  that letters exchanged between the employer and  employee(s) may amount to a hearing.  However, there is   no evidence of such letters exchanged between the   Claimants and the Respondent on the subject matter.  There is no letter stating the charges/complaints and   responses thereto.

38.  The only evidence produced by the Respondent in this   regard are statements recorded by the Claimants in regard  to the alleged theft.  That cannot amount to fair hearing as   envisaged in law and the principles outlined above.  While  employers may not be expected to follow the rules of  evidence and procedure applicable in a court of law   nonetheless they are expected to apply rules of natural justice and reasonable fairness.

39.  This court holds that while the Respondent had reasonable  substantive reason for summarily dismissing the  Claimants, it did not apply fair procedure in taking and  enforcing the decision.  In the circumstances, the summary  dismissal of the Claimants by the Respondent was hence  unlawful for want of procedural fairness.

VII.  RELIEFS

40.  A party to a cause is bound by the pleadings filed and  the reliefs sought by the Claimants have been set out in the first page of this judgment as extracted from the Statement  of claim. This court shall now proceed to consider each of  the reliefs sought.

41.  Prayer (a) is for declaration that the Claimants’ termination (summary dismissal) was unfair. This   court has already  found that the dismissal was unfair for want of procedural fairness and same is hereby declared as such.

42. Prayer (b) is for reinstatement of the Claimants to their  previous employment. While Section 49(3) (a) of the Act   provides for reinstatement as one of the remedies that this  court may grant, Section 12 (3)(vii) of the Employment and  Labour Relations Court Act qualifies and clarifies the place of this remedy by providing that the same may  only be granted within three (3) years of dismissal.  The  Claimants were dismissed in 2012, almost 10 years ago, and hence this remedy is not available to them in 2022.

43.  However, in the alternative to prayer (b) above the Claimants pleaded for compensation for unfair  termination (dismissal) in prayer (c). This remedy is   provided for in Section 49(1)(c) of the Act and while assessing and arriving at a reasonable award under this  head this court shall be guided by the factors set out in  Section 49(4) of the Act.  The award made shall not  exceed the equivalent of twelve months wages based on the gross monthly wage or salary of the employee at the  time of dismissal.

44. As noted elsewhere in this judgment the Claimants were dismissed summarily on suspicion of involvement in theft of property belonging to a client of the Respondent. Subsequently to the alleged theft, the claimants were  arrested and charged in court for their alleged  involvement.  While this court has not had the benefit of perusing through the proceedings in the criminal trial, it is common ground that the claimants were not convicted.  They were either discharged or acquitted.

45.  Whatever happened in the Criminal case this court is  inclined to take the view that a theft took place in the  premises of UNGA LIMITED, a client of the Respondent, wherein the Claimants were on duty.  It is logical and  reasonable to conclude that the claimants were either  negligent while on duty or that they took part in the theft.

46.   This court holds that the Claimants, to a large extent, contributed to the misfortune that befell them in losing their employment with the Respondent.  RW1 testified that  after the alleged theft the Respondent lost the business  from UNGA LIMITED.   This court has already found that were it not for the procedural unfairness leading to the  summary dismissal of the Claimants, the Respondent had  reasonable grounds for dismissing them summarily.

47.   Although an employee may not be a shareholder in the   business of his/her employer, it is incumbent upon the  employee, at all times, and in his/her own personal and   financial interest in his/her continued employment, to  guard and protect the property and lawful interests of the employer.  If and where an employee engages in unlawful or sabotaging activities against his employer, and as a   result the employee is terminated or dismissed, such an   employee must  shoulder his/her fair share of blame.

48.  Had the Claimants been vigilant and professional in their  duties they could not have lost their employment.  It is this  court’s view that the Claimants were co-authors of their  misfortune.

49.  There is no evidence on record as to whether the  Claimants were able to secure jobs after the dismissal and  if they did how long it took them.  There is no evidence on   the situation in the security services industry and whether   jobs are easy or hard to come by.

50.   The Respondent offered to pay what it considered to be dues payable to the Claimant but the same were rejected  by the Claimants.

51.  In his testimony and his statement dated 26th March 2021,  the 1st Claimant stated that he had worked for the  Respondent for a period of over 12 years at the time of his    dismissal.  There is no evidence on record on how long the 2nd and 3rd Claimants had worked for Respondent at the   time of dismissal.

52.  Considering all the above scenarios and factors and  applying the parameters provided for in Section 49(4) of   the Act, this court is of the considered view that an award  of three (3) months gross salary to each of the Claimants is  fair and reasonable compensation.  This is based on the finding that the claimants were not subjected to procedural  fairness otherwise this cause should have been dismissed.

53.  The last disclosed gross salary for the 1st Claimant as exhibited in the payslip for October, 2011 is Kshs.12,000/=  and hence under this head he is awarded Kshs.12,000 X 3    = 36,000/=.

54.  The last disclosed gross salary for the 2nd Claimant is Kshs.6,754/= as exhibited in the payslip for September, 2011 and hence his dues under this head is Kshs.6,757/= X 3 = Kshs.20,272/=.

55.  There is no payslip availed in respect of the 3rd Claimant on record.  There is no other evidence availed to enable this court to establish his last pay  Nothing of help is to   be   found in the pleadings and hence this court is unable to  make any award to the 3rd Claimant.

56.   Prayer (d) “is payment of their terminal benefits” and  prayer (e) “payment of all sums calculated as underpayment in salary and other allowance.”  This court is unable to make sense of the same.  What terminal dues?  Where is the evidence on the same? Where is the  calculation of the under payments in salary and other allowances?

57.   CW1, the 1st Claimant, who testified on his own behalf   and on behalf of the other Claimants, did not adduce any  evidence in support of prayers (d) and (e).  It is not enough to state or make an allegation in the pleadings.  A party to  a suit must tender evidence in support of the allegations in  the pleadings to persuade the court to find in their favour  and prove its cause.  The Claimants failed to execute   that duty.

58.    However, this court notes that the Claimants were not  issued with a notice before dismissal and hence they are  legally entitled to one(1) month’s gross salary in lieu of notice.  The 3rd Claimant again misses out on this award as  there is no evidence of what his gross salary was at the    time of his dismissal.

VIII. COSTS

59.  Costs follow events and the 1st and 2nd Claimants are  awarded costs based on the awards made above.

IX.  DISPOSAL

60.    Disposal of this cause this court makes the following orders:

(a)   A declaration be and hereby issued that the summary dismissal of the Claimants by the Respondent was unfair and unlawful for lack of procedural fairness.

(b)   The 1st and 2nd Claimants are awarded the    following:-

(i)   1st Claimant

- Compensation for unlawful Dismissal -   Kshs.36,000/=

- One(1) months’ salary in lieuof Notice-     Kshs.12,000/=

TOTAL     -                                  Kshs.48,000/=

(ii)    2nd Claimant

-   Compensation for unlawful Dismissal -   Kshs.20,271/=

-   One(1) months’ salary in lieuof Notice-  Kshs.6,757/=

TOTAL     -                                   Kshs.27,028/=

The awards in (b) (i) and (ii) above are both subject to  statutory deductions.

(c)   The 1st and 2nd Claimants are awarded costs based on  the awards made. There is no order as to costs in  regard to 3rd Claimant.

DATED, SIGNED AND DELIVERED VIRTUALLY THIS   14TH  DAY OF MARCH, 2022.

..............................

DAVID NDERITU

JUDGE