1. At all material times to this suit the Claimants averred that they were employees of the 1st Respondent and on the onset of this cause each Claimant filed their respective Claim as follows:
a. EMILY CHEBET CHOGE ELRC NO. 308 of 2017 where filed a claim dated 28th September, 2017 and averred that she was employed by the Respondent as a Records Clerk on 3rd April, 2001 earning a monthly gross salary of Kshs.28,060/= and that the she served the Respondent with loyalty, diligence and full dedication and commitment rising to a position of Revenue Accountant at a salary of Kshs 42,936/= per month at the time of her suspension and termination.
b. JONAH KIPLIMO TUNGE ELRC NO. 167 of 2017 formerly Kisumu ELRC NO 414OF 2015 filed a claim dated 11th September, 2015 and filed on 25th November,2015 later amended by an Amended Claim dated 29th October,2016 filed on 7th November, 2016 and averred that he was employed by the Respondent as Accountant II on 2nd February, 2010 earning a monthly gross salary of Kshs.43,038/= and that he served the Respondents with loyalty, diligence and full dedication and commitment rising to a position of Revenue Account at a salary of Kshs. 87,552/= per month until the time of his suspension and termination.
c. DIVINAH CHEPKEMBOI ELRC NO. 169 of 2017 filed a claim dated 28th September, 2017 filed on 19th October,2017and averred that she was employed by the Respondent as a Accounts Assistant on 14th October, 2009 earning a monthly gross salary of Kshs.49,674/= up to the time of suspension and termination.
d. RUBEN KIPKOECH ELRC NO. 309 of 2017 where he filed a claim dated 28th September, 2017 filed on 19th October,2017and avers that he was employed by the Respondent as a Records Clerk II on 11th December, 2002 earning a monthly gross salary of Kshs.41,936/= and that he served the Respondents with loyalty, diligence and full dedication and commitment rising to a position of Information Communication Technology Officer at a salary of Kshs 41,936/= per month until his time of his suspension and termination.
2. The Claimants in general averred that the Respondents purported to suspend the Claimants’ services from employment on 19th February, 2015 without giving them any reasonable cause and later terminated the Claimants on 13th January, 2016 and that the Respondents neither complied with rules laid down in the Employment Act and labour laws nor accorded the Claimants the right to be heard contrary to the requirements of rules of natural justice in the alternative the Respondents were bound by the Public Service Act and regulations requiring that an employee who is charged with a criminal offence to remain on suspension on half pay until such time as the court shall have rendered a verdict.
3. The Claimants averred that the Respondents did not comply with the requirement of Section 45(2) of the Employment Act 2007 as the allegations which the Respondents alleged against the Claimants were sub judice before a court of law in Criminal Case at Eldoret Chief Magistrates Court Criminal Case No. 1691 of 2015; REPUBLIC VS JONAH TUNGE & 6 OTHERS, where the Respondents were the Complainants.
4. The Claimants averred that prior to the illegitimate suspension, the Claimants had been on forced unpaid leave for 10 months Pending investigations and determination of their case both by the Respondents and Criminal Investigations Department and that on or about 13th January, 2016 the Respondent jointly and severally in disregard of the doctrine of sub judice convened a disciplinary committee meeting and made a finding to summarily dismiss them.
5. The Claimants averred that the Public Service Rules are consistent with Article 49 of the new Constitution of Kenya 2010 that presumes every accused person as innocent untill proven guilty before a court of law of competent jurisdiction and that the communication arising there from terminating the Claimants employment was unlawful, illegal as it sought to supplant the determination of the Chief Magistrates Court in Eldoret in Criminal Case No. 1691 of 2015: REPUBLIC VS JONAH TUNGE &6 OTHERS
6. In alternative the Claimants averred that the dismissal was oppressive and disregarded the due process of the law.
7. The Claimants averred that as a result of the premature dismissal and unlawful dismissal they had been put to loss and hardship arising from the act of suspension without pay and consequently crystallized in a dismissal without pay though they were still facing a criminal prosecution by the Respondents.
8. The Claimants also raised constitutional and statutory guarantees under the Constitution of Kenya 2010 which are not limited to Article 27 on equality and non-discrimination, Article 47 on fair administrative action, Article 50 2(a) on innocence of accused person and Article 236 on discrimination against public servants; Sections 46 and 47 of the Employment Act on due process, Article 50(2) (a) of the constitution 2010 on the right to fair trial and Sections 23 and 24 of the Public service Commission code of Regulations 2005 on the procedure and pay.
9. The Claimants sought for special damages/lost earnings in the form of salary and allowance arrears during the time of suspension, payment in lieu of suspension and notice, damages for unfair termination and pension as follows; Emily Choge- Kshs 2,124,236.00/-, Jonah Kiplimo Tunge-Kshs 7,628,907.01/-, Divinah Chepkemboi-Kshs 4,134,682.64/- and Ruben Kipkoech-Kshs 3,924,738.64/=
10. The Claimants in the upshot prayed for the following against the Respondents;
a. An order to compel the Respondents restore the Claimants pay with effect from 19th February, 2015 when the Respondents suspended the Claimants.
b. A declaration that the decision to suspend the Claimants without pay is unconstitutional and illegal and infringes on their constitutional rights particularly Articles, 28,41(1),47,48 and 50(1) of the Constitution of Kenya 2010.
c. An order to compel the Respondents against suspending the Claimants without pay contrary to the Public Service Commission code of Regulations 2005 on Discipline of public officer requiring the employee to be put on half salary awaiting determination of the criminal case
d. Damages for illegal suspension with effect from 19th February, 2015.
e. A declaration that the Claimants’ services were procedurally, unlawfully and unfairly terminated.
f. Payment of salary and allowance arrears for the months of February, 2015 to January 2016.
g. Payment in lieu of notice
h. A declaration that the Claimants be compensated for unfair suspension and unlawful detention and abuse of court process consecutively
i. Certificate of Service
j. Costs and interest at court rate with effect from 19th February 2015 to Judgment date
11. The Respondents filed their statement of Defence and Counterclaim in the respective files where in summary the Respondent stated that the 2nd Respondent is the Chief Executive officer of the 1st Respondent not an acting one.
12. The Respondents averred that the Claimants were suspended to protect legitimate business interests of the 1st Respondent and denied that the Claimants worked with dedication, loyalty, diligence and full commitment since they all had a past history of misconduct and were given show cause letters warned and later they took part in the new fraud defrauding the Respondents revenue hence they neglected to do their job as per the contract.
13. The Respondents averred that the Claimants were subjected to due process in accordance with Employment Act, Fair Labour practices, the rules of natural justice and the Constitution of Kenya as they were accorded a chance to appear before the 1st Respondent disciplinary committee three times but they were misadvised by their lawyers not to appear thereby squandering the opportunity to present their case and be heard; hence they waived their right to be heard.
14. The Respondents averred that the Claimants were given adequate reasons for their suspension which included failure to perform properly and carefully work that was assigned to them, being involved in corrupt practices and abuse of office as per their suspension letters respectively.
15. The Respondents averred they were not bound by the provisions of the Public Service Act and regulations as regards terms of employment between them and the Claimants because the Claimants accepted the terms and conditions of service of the 1st Respondent and signified in writing acceptance of those terms thus the Claimants were bound by the terms and conditions of service of the 1st Respondent; the said Public service regulations were repealed by the Employment Act 2007, The Labour Relations Act and the Constitution of Kenya 2010.
16. The Respondents further averred that the Claimants were not entitled to half pay but were entitled to no pay while on suspension being guided by section 16.11.2 (ii) of the 1st Respondent terms and conditions of service.
17. The Respondents averred that it would be unfair labour practice for the Employer to pay an employee during suspension period if at the end of the disciplinary process the employee is found culpable and that Claimants committed an offence that warrants summary dismissal nevertheless the Respondents issued suspension notice and directed the Claimants to show cause why charges leveled against them do not constitute lawful grounds for their dismissal as per their terms of engagement.
18. The Respondents further averred that despite several invitations by the Respondents to the Claimants to attend the Respondents disciplinary committee the Claimants did not turn up which by conduct, the Claimants waived their constitutional and statutory right to be explained in a language that they understood, the reasons of the intended dismissal, by failing to honour the three of the Respondent’s invitations to appear before the disciplinary committee they cannot as an afterthought run to the court seeking to enforce this constitutional right.
19. In addition the Respondents terms and conditions of service allowed the Claimants to be accompanied by a person of their choice including their advocate, another employee or shop floor union representative/steward which the all neglected to utilize.
20. The Respondents further averred that there was no nexus between an employer’s internal disciplinary process and the criminal case even when the particulars and charges are similar; the internal disciplinary tribunal was not held to the same standards as a court of law; Court of law should not generally interfere with an employers’ right to conduct its own internal disciplinary proceedings.
21. The Respondents further averred that the Respondents were entitled to proceed with their internal disciplinary proceedings to protect its reputation, legitimate business interest and to prevent further injury due to the Claimants’ fraudulent activities which proceedings were provided for by the terms and conditions of service between the parties.
22. The Respondents further averred that the Respondents did not have control over the criminal case since they did not prosecute cases but that was the role of the DPP.
23. The Respondents further averred that the Claimants could not enjoy the constitutional guarantees prayed for as the Claimants were not such public servants protected by Article 236 of the constitution and in cases as this one the Respondent was entitled to suspend the Claimants without pay and the Claimants having been summarily dismissed lost the benefits due to them in accordance with the Employment Act and the Respondents terms and conditions of service.
24. The Respondents raised counterclaim on each Claimant as per the revenue lost on their hands; Emily Kshs 291,325, Rueben Ksh 11,893.687/=, Jonah Kshs 11,223,588/= and Divinah Ksh6,436,132/=;
25. The Claimants filed a Reply to the Respondents’ Response and counterclaim in each respective files where they all denied the involvement in the corruption allegations by the Respondents and on the Defence to Counterclaim the Claimants denied the respective amounts attributed to have been lost on their hands and prayed for dismissal of the Respondents’ defence and counterclaim herein.
26. At the oral hearing CW 1, Jonah Tunge the 2nd Claimant on oath testified and adopted the documents filed before the court. He testified that after the Respondents claim of his involvement in corruption by colluding with others they were suspended and put on half salary as criminal case proceeded and they were acquitted on 19th July, 2019.
27. CWI testified that they were called for disciplinary hearing in 2015 and they did not attend but responded to the notice requesting to be allowed to attend with their lawyer but did not get response from the Respondent and further that they were not permitted as the criminal case was still ongoing. They later received dismissal letters from acting CEO. It was his evidence that he was not given a copy of the HR manual despite asking for the same and that the dismissal should have been done by a substantive CEO and that that the dismissal letters never informed them of the right to Appeal.
28. CW1 sought to be compensated for wrongful and unfair dismissal and arrears prayed for in their claim and confirmed that they were issued with certificates of service by the Respondents after determination of the criminal case.
29. CW2 Emily Chebet Chonge 1stClaimant also testified on oath and stated that she would rely on the documents filed in court as evidence in chief. She stated that she accepted that she defrauded the Hospital under duress and that she was never cautioned about the consequences of her confession and that she admitted the charges in the Criminal case and was acquitted and prays to be compensated as per her statement of claim.
CLAIMANTS’ SUBMISSIONS
30. The Claimant filed written submissions dated 16th March, 2023 on 20th March, 2023. The Claimants submitted that were not given a fair hearing and that the process was in violation of the procedure set out in the Terms and Conditions of the Service Booklet. The Claimant relied on Section 41, 43, and 44 of the Employment Act, 2007 and submitted that they were unfairly suspended and finally summarily dismissed.
31. It was the Claimants’ further submission that the suspension was subject to provisions of section 62(1) of the Anti-Corruption and Economic Crimes Act on Claimants being suspended on half pay.
32. The Claimants further submitted that Respondents did not follow the procedure envisaged under section 41 of the Employment Act, on the reasons given for termination and that the Claimants were not accorded a fair hearing.
33. The Claimants placed reliance on cases; Elizabeth Washeke and others vs Airtel Ltd and Another cause No. 1972 of 2012; Mulwa Msanifu Kombo vs Kenya Airways. On the reasons for termination and procedure used by employer, the Claimants submitted that the reasons for termination as involvement in fraudulent activities was not sufficient and the procedure was not fair.
34. The Claimants also relied on the case of Paul Ngeno vs Pyrethrum Board of Kenya on issue of payment of salaries, allowances and benefits and the case of Julius Gatete Ihomba vs Wells Fargo Limited to submit on the issue of interest from the date of suspension. The Claimants also relied on case of Patrick Lumumba Maikava vs KPA (2012) eKLR to submit on the issue of notice pay.
35. The Claimants further submitted that their services were unprocedurally, unlawfully and unfairly terminated by the Respondents without payment of salary and allowance arrears from February 2015 to January 2016. Reliance was put on case of Christopher Amasaya vs Kenya Revenue Authority & Another (2021) eKLR to submit that the Respondent failed in the fairness test and there was no substantive justification for determination of their employment. Further, the Claimant relied on the case of Patrick Kibui Nyingi vs Nairobi City Water and Sewerage Company limited & Another (2020) Eklr to submit that the Claimants were to work for Respondents until retirement save for this summary dismissal.
36. The Claimant thus submitted and prayed for all the reliefs in the Memorandum of Claim to be granted.
RESPONDENTS’ SUBMISSIONS
37. The Respondents on the other hand filed their written submissions dated 8th May, 2023 on 9th May, 2023. Counsel submitted that the Claimants’ suspension before termination was fair and according to section 44(3) and (4)(c) and (g) of the Employment Act 2007 and section 16.11.2(ii) of the Respondents’ Terms and Conditions of Service in support of his submission that the Claimants were not entitled to any pay during suspension.
38. Counsel further submitted that the Claimants’ subsequent termination was fair because their contracts of employment were terminated for failing to perform the functions of their offices as expected of them under their contract.
39. Counsel relied on Section 43(1) and (2) of the Employment Act to submit that the Claimants dismissal from service was based on valid reasons of fraud which amounted to gross professional misconduct because they breached the provisions of section 16.5.1(p)(1) and (2) of the Respondents’ terms and conditions of service.
40. Counsel further submitted that section 16.5.3© and (g) of their terms and conditions of service provided for summary dismissal in case of gross misconduct and section 16.10.3 provided for termination in case of gross misconduct.
41. Counsel further submitted that even though the Claimants committed gross misconduct they were accorded opportunity to be heard through disciplinary processes which they declined hence the Respondents were entitled to suspend the Claimants without pay.
42. Counsel relied on a number of cases to submit that the suspension of the Claimants was a fair. These included; Canadian Supreme Court of Appeal cited with approval in Hosea Kipkorir Serem vs Moi Teaching & Referral Hospital (2017) eKLR; Kenya Enginering Workers Union v AutoAspring Manufacturers Limited (2013) e KLR; David Njeka v Lavage Dry cleaners limited(2013) Eklr;Abdi Mohamed Daib v Kenya Ports Authority(2016)Eklr and Fredrick Saundu Amolo v Principal Namanga Mixed Day Secondary school & 2 others(2014)
43. On the issue of suspension without pay and subsequent termination counsel submitted that the Claimants were not entitled to any pay as it would amount to unjust enrichment and after the disciplinary process found them culpable then they were terminated summarily and lost all their benefits. Reliance was placed on the following cases; Grace Gacheri Murithi v Kenya Literature Bureau (2012)eklr; Nahason Muriithi Wambugu v Teacher’s Service Commission(2016)eKLR to submit that the Respondents Disciplinary committee was not bound by the same standard of proof as a court of law and Josephat Mukwana Waswa v Moi Teaching & Referral Hospital(2015) eKLR to submit that Claimants could not challenge the Acting Executive officer’s role when it comes to discipline of employees.
44. Counsel further submitted that the court should grant the Respondents prayers sought in their pleadings to dismiss the Claimants’ suit with costs and allow their Counterclaim.
45. The Court has reviewed and considered the pleadings, testimonies and submissions by both counsel in support and opposition to the case and also considered authorities relied on by Counsel.
46. Two main issues arise for determination, that is;
a. Whether the suspension and the subsequent termination of the Claimants’ employment was procedural and fair.
b. Whether the Claimants’ suspension without pay was fair and lawful.
47. Regarding the first issue, the court has stated previously that it is not within its realm to over-analyze the reason for which employment has been terminated. The test usually is the reasonable test. That is to say, would a reasonable employer put in the circumstances dismiss? If the answer be in the affirmative, the court will not interfere.
48. In this case, the Respondents suspended the Claimants from duty on 19th February, 2015 and proceeded to terminate their services on 13th January, 2016 by summarily dismissing them.
49. The Claimant’s suspension and subsequent termination from employment was as a result of allegations of involvement in fraudulent activities where the Claimants colluded to defraud the 1st Respondent of revenue as stated in the report produced herein.
50. The 1st Claimant Emily wrote to the Respondents explaining how in conjunction with her immediate supervisor Jonah Tunge co-Claimant herein, they colluded to defraud the Respondent together with the rest of the Claimants and the fact that the said Emily and Divinah implicated the rest of the Claimants in the fraud allegations in the statements they wrote when they were arrested, the same Emily Choge at the hearing herein denied admitting to the fraud charges stating that the admission was done under duress and she was not cautioned against her confessions.
51. Whilst the Claimants’ contend that the allegations of fraud against them were untrue, the Respondents maintained that the allegations were confirmed as true after the Auditor’s report and admission by the 1st and 3rd Claimants who implicated the rest.
52. As observed earlier, the test for reasons for dismissal is “the reasonable test”. An allegation of fraud is serious since it is an act to the detriment of employer’s property which is one of the grounds for summary dismissal. The respondent did not just make an allegation but provided evidence of such fraud. It matters not that the evidence did not succeed in proving the claimant’s guilt at the criminal trial. If it is reasonably demonstrated that the claimants more probably than not engaged in acts of fraud against their employer, their dismissal would not be faulted. In this particular case, the evidence against the claimants sufficiently justified their dismissal.
53. Regarding the disciplinary proceedings, the Claimants pleaded that they did not attend the Respondents Disciplinary processes as they were advised by their lawyers not to do so as long as there was a pending criminal case and that when they requested to attend with their lawyer they did not get any response from the Respondents.
54. According to the Claimants the Respondents’ Disciplinary process did not carry much weight as what was important was the determination of the criminal case and if the two were to be done concurrently to them this amounted to double jeopardy.
55. On its part, the Respondents maintained that the process of suspension and subsequent termination of the Claimants’ employment was fair and procedural and that the Claimant were suspended for almost one year from 19th February, 2015 to 16th January, 2016 after which they were summarily dismissed after they failed to attend to the Respondents Disciplinary hearings for three times. The concession by the claimants that although invited, they declined to attend the disciplinary hearing on the advice of their lawyers that as a long as the criminal trial remained ongoing they should not attend the disciplinary hearing. This in the court’s view was erroneous since there is nothing wrong with a disciplinary process, which is an internal administrative process, running side by side with a criminal trial which is conducted under different factual considerations and standard of proof. By failing to attend the disciplinary hearing, the claimants squandered their chance to defend themselves and therefore cannot be heard to fault the process and the conclusions reached.
56. Regarding the suspension of the Claimants, section 16.11.2(i) of the Respondents Terms and Conditions of service which governed the Claimants in this case provided that;
Where an employee has committed a criminal offence, the director shall order for his suspension from exercise of his duties, pending consideration and determination of the case.
57. In assessing the legality of suspension, the Court of Appeal in Mutwol v Moi University (Civil Appeal 118 of 2019) [2022] KECA 537 (KLR) (28 April 2022) adopted the position in the Canadian case of Cabiakman v. Industrial Alliance Life Insurance Co., 2004 SCC 55, [2004] 3 S.C.R. 195, in which the Supreme Court laid down several factors that can guide the courts in determining whether an employer was justified in deciding to temporarily suspend an employee thus:
“This residual power to suspend for administrative reasons because of acts of which the employee has been accused is an integral part of any contract of employment, but it is limited and must be exercised in accordance with the following requirements: (1) the action taken must be necessary to protect legitimate business interests; (2) the employer must be guided by good faith and the duty to act fairly in deciding to impose an administrative suspension; (3) the temporary interruption of the employee’s performance of the work must be imposed for a relatively short period that is or can be fixed, or else it would be little different from a resiliation or dismissal pure and simple; and (4) the suspension must, other than in exceptional circumstances that do not apply here, be with pay”
58. In this case the Claimants were suspended to protect the 1st Respondent business interests and they were given the reasons for the suspension being involvement in corrupt practices, failure to perform work properly and carefully, abuse of office and committing or on reasonable grounds being suspected of committing a criminal offence. The suspension was stated to be in compliance with the terms and conditions of service section 16.5.1(p)(1)(2) on offences and misconduct and 16.5.1.3(c)(g) on gross misconduct.
59. The Respondent produced evidence of lost revenue to the tune of Kshs. 11,223,588/= which Emily and Divinah acknowledged as fraud and implicated the rest of the Claimants even though during hearing Emily said the same was accepted under duress. The foregoing factual scenario justified the suspension of the claimants and further the facts presented exceptional circumstances that justified suspension without pay.
60. In conclusion the Court finds and holds that there existed justifiable grounds for the termination of the claimants’ service summarily and that the procedure followed was fair in the circumstance. The claim is therefore found without merit and is hereby dismissed with costs.
61. It is so ordered.
62. Dated at Nairobi this ……… day of ……………. 2023
63. Delivered virtually this …. day of …….……..2023
Abuodha J.N
Judge.