https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/2207

 **REPUBLIC OF KENYA** **IN THE EMPLOYMENT *&* LABOUR RELATIONS** **COURT OF KENYA AT KISUMU** **CAUSE NO. E074 OF 2025** WILSON OWUOR OCHUNG.....................................................**CLAIMANT** **VERSUS** AGA KHAN HOSPITAL KISUMU..............................……**RESPONDENT** **JUDGMENT** 1. The Claimant instituted this suit via a Memorandum of Claim dated 6th August 2025 alleging unlawful termination of employment, he sought the following reliefs: * + 1. A declaration that the termination of his employment was discriminatory, malicious, unlawful, unfair and unprocedural 2. Kshs. 2,205,868/- in pay in lieu of notice, compensation and salary arrears 3. A letter of recommendation outlining his employment period and position without making reference to the misconduct. 4. Interest on the sums above. 5. Costs and interests of the suit. 6. Any other relief the court deems fit to grant. 2. The Claimant avers that he was employed as MRI technologist at a salary of Kshs. 148,742/- on 19th December 2016, serving diligently until 8th August 2024 when he was summarily dismissed. He avers that the dismissal was unlawful and baseless and contrary to section 41, 43 and 45(2) of the Employment Act. 3. In response to the suit the Respondent filed a Memorandum of Response dated 7th October 2025 admitting that it employed the Claimant but denied that his employment was terminated unlawfully or unfairly. It contends that the Claimant was summarily dismissed for valid and justified reasons amounting to gross misconduct involving financial impropriety and breach of the Respondent’s policies and procedures. Specifically, the Respondent avers that an audit of its hospital systems revealed that on 28th March 2024 the Claimant undertook an MRI procedure for a patient who paid Kshs. 18,000/- in cash, but the payment was irregularly posted to a Jubilee Insurance account and records in the CARE 2000 system were altered, thereby leaving the billing unaccounted for. According to the Respondent, these actions were indicative of an attempt to defraud the hospital. It further avers that the Claimant admitted inviting the patient’s helper into the billing counter area and the MRI suite, contrary to the hospital’s policies restricting access to authorised persons only. The Respondent states that following the audit findings, the Claimant was issued with a show cause letter dated 19th June 2024, to which he responded on 22nd June 2024. He was thereafter invited to a disciplinary hearing scheduled for 28th June 2024 and informed of his right to be accompanied by a witness. The Respondent maintains that disciplinary sessions were subsequently conducted on 28th June, 3rd July, and 2nd August 2024, during which CCTV footage was played, additional evidence was produced, and the Claimant was afforded an opportunity to cross-examine a witness and make representations in his defence. According to the Respondent, after the disciplinary process was concluded, the Claimant was summarily dismissed by letter dated 7th August 2024. The Respondent further testified that the Claimant lodged an internal appeal dated 13th August 2024 and was invited to appear before the appeal committee on 6th September 2024. The appeal committee reviewed the CCTV footage and heard the Claimant before dismissing the appeal. The outcome of the appeal was communicated to the Claimant by letter dated 1st October 2024. 4. The Respondent further avers that following his summary dismissal the Claimant was paid his terminal dues, issued with a certificate of service, and later paid his pension benefits. It further contends that the Claimant voluntarily executed a discharge voucher on 14th October 2024, thereby waiving any further claims arising from the employment relationship. Consequently, it urges the court to dismiss the suit with costs. At the close of hearing parties filed written submissions. Claimant’s Submissions 1. The Claimant identifies the following issues for determination: * + 1. Whether the Respondent unlawfully and unfairly terminated his employment; and 2. Whether the he is entitled to the remedies sought. 2. On the first issue the Claimant submits that both the substantive justification and procedural fairness requirements under sections 41, 43 and 45 of the Employment Act were not met. He contends that the allegations of collusion to defraud the Respondent and alteration of billing records were not supported by credible evidence and that the Respondent did not establish that he received or benefited from the alleged payment of Kshs. 18,000/-. The Claimant contends that his duties were limited to assessing whether a patient was fit to undergo an MRI procedure and did not include billing or receipt of payments. He relies on the internal audit report, patient ledger, and the evidence of the Radiology Manager to argue that billing was undertaken by the Patient Services Desk clerk and that the relevant payment records were available within the Respondent’s system. He further submits that the Respondent failed to investigate who altered or cancelled the billing records and therefore did not prove the allegations against him. On procedural fairness the Claimant asserts that he was given only two clear days to prepare for the disciplinary hearing, was not supplied with material documents such as the CCTV footage, internal audit report, and payment records before the hearing, and was therefore denied a fair opportunity to prepare his defence. He further contends that the Respondent relied on outdated internal policies that did not prohibit his interaction with the patient’s helper. He relies on **Walter Ogal Anuro *v* Teachers Service Commission [2013] eKLR,** for the proposition that a termination is unfair where the employer fails to prove a valid reason and fails to follow a fair procedure. He also relies on **Margaret Auma Ingwe *v* Kenya Power and Lighting Company Limited [2015] eKLR**, where the Court held that fairness under section 41 requires that charges be clear, adequate time be given for preparation, relevant documents be supplied, and the employee be afforded an opportunity to call witnesses. Further reliance is placed on **Moses Misango *v* Barclays Bank of Kenya Limited [2015] eKLR**, in which the Court stated that the employer must demonstrate a valid reason that would cause a reasonable employer to dismiss the employee. The Claimant also cites **Pius Machafu Isindu *v* Lavington Security Guards Limited [2017] eKLR**, where the Court of Appeal held that an employer bears the burden of proving the reasons for dismissal, their validity and fairness, and compliance with the mandatory procedure under section 41 of the Employment Act. He additionally cites **Lubin Goliche Seme *v* Weso Trustee Limited [2024] eKLR** for the proposition that failure to prove a valid ground for dismissal renders a termination unfair. 3. On entitlement to the remedies sought, the Claimant submits that having established that the dismissal was unfair and unlawful, he is entitled to one month’s salary in lieu of notice under section 35 of the Employment Act and compensation for unfair termination under section 49(1)(c) of the Act. He asserts that he served the Respondent for approximately seven years, had a long remaining working life before retirement, did not contribute to the dismissal, and has remained unemployed since his termination. 4. The Claimant also submits that he is entitled to general and exemplary damages for breach of his right to fair labour practices under Article 41 of the Constitution. He relies on **Mokaya *v* Kithure Kindiki t/a Kithure Kindiki *&* Associates [2021] KEELRC 1 (KLR)**, where the Court awarded exemplary damages for violation of constitutional rights in an employment context. Accordingly, he urges the Court to allow the claim as prayed. Respondent’s Submissions 1. The Respondent identifies the following issues for determination: * + 1. Whether the termination of the Claimant’s employment was wrongful, unfair and unlawful; and 2. Whether the Claimant is entitled to the reliefs sought. 2. On the first issue the Respondent submits that it complied with sections 41, 43 and 45 of the Employment Act before summarily dismissing the Claimant. It contends that an internal audit conducted in May and June 2024 revealed that the Claimant colluded with a colleague in the Patient Services Department to circumvent the Respondent’s billing procedures and fraudulently receive cash payments from a patient’s caregiver. It asserts that CCTV footage demonstrated that the Claimant was directly involved in the transactions and that his conduct amounted to gross misconduct and financial impropriety. The Respondent reiterates that the Claimant was issued with a show cause letter on 19th June 2024, responded to the allegations, attended several disciplinary hearings on 28th June, 3rd July and 2nd August 2024, was informed of his right to be accompanied by a colleague, was shown the CCTV footage, and was afforded an opportunity to question the evidence and witnesses. It therefore contends that the disciplinary process satisfied the procedural requirements under section 41 of the Employment Act. It asserts that it provided notification of the charges, an opportunity to the Claimant to prepare for the hearing, and the consideration of his representations before the decision was made as envisaged in **Antony Mkala Chitavi *v* Malindi Water *&* Sewerage Company Limited, [2013] eKLR**.The Respondent further submits that section 43(2) of the Employment Act requires an employer to only demonstrate that it genuinely believed the reasons for termination to exist at the time of dismissal. It asserts that the Court should apply the objective “range of reasonable responses” test in determining whether a reasonable employer would have dismissed the employee in similar circumstances. In support of this position, the Respondent relies on **British Leyland UK Limited *v* Swift [1981] I.R.L.R. 91**, where the Court held that a dismissal is fair if it falls within the band of reasonable responses available to a reasonable employer. The Respondent also cites **Paul Waigiri Muriuki *v* Nairobi Water and Sewerage Company Limited, [2015] KEELRC 1100 (KLR)**, submitting that the Court should not substitute its own view for that of the employer or re-enact the internal disciplinary process. The Respondent submits that, following the disciplinary hearings, the Claimant was summarily dismissed on 7th August 2024 for involvement in fraudulent transactions resulting in loss to the Respondent. It further argues that the Claimant exercised his right of appeal, appeared before the appeal committee on 6th September 2024, and that his appeal was dismissed on 1st October 2024 after the CCTV footage was reviewed afresh. The Respondent therefore contends that both substantive justification and procedural fairness were established. 3. The Respondent additionally submits that the Claimant voluntarily executed a discharge voucher on 14th October 2024 after receiving his terminal dues and pension benefits, thereby waiving any further claims arising from the employment relationship. In this regard, the Respondent relies on **Katiwa Kanguli *v* Bamburi Cement Limited [2015] eKLR**, where the Court held that a discharge voucher is binding unless obtained through fraud, duress, mistake, undue influence or misrepresentation. It also relies on the Court of Appeal decision in **Coastal Bottlers Limited *v* Kimathi Mithika [2018] eKLR**, which held that a settlement agreement releasing an employer from further claims is binding where its execution is not impugned. Further reliance is placed on **Trinity Prime Investment Limited *v* Lion of Kenya Insurance Company Limited [2015] eKLR**, where the Court held that a discharge voucher constitutes a complete contract, **Damondar Jithabhai *&* Co. Ltd *&* another *v* Eustace Sisal Estates Ltd [1967] EA 153**, on the duty of courts to give effect to the parties’ contractual intentions, and **Globe Motors Inc *&* others *v* TRW Lucas Electric Steering Ltd *&* others [2016] EWCA Civ 396**, where the English Court of Appeal affirmed the principle of contractual freedom. The Respondent therefore submits that the Claimant failed to prove that the dismissal was unlawful, unfair or procedurally defective. 4. On whether the Claimant is entitled to the reliefs sought, The Respondent submits that, having demonstrated that the summary dismissal was lawful, procedurally fair and substantively justified, and having further established that the Claimant voluntarily executed a discharge voucher waiving any further claims, none of the remedies sought by the Claimant can crystallise. It therefore urges the Court to dismiss the claim in its entirety with costs. Disposition 1. The Claimant’s contract was terminated by the Respondent after allegations of misconduct were levelled against him. The Claimant was issued with a show cause letter dated 19th June 2024. The Claimant responded to the allegations and attended the disciplinary hearings held on 28th June 2024, 3rd July 2024 and 2nd August 2024. The Claimant was afforded an opportunity to question the evidence and witnesses. He had been notified he could be accompanied by a colleague of his choice. In my considered view, the disciplinary process satisfied the procedural requirements under section 41 of the Employment Act. The Respondent put the Claimant on his defence, he was permitted to make representation and at the end of the hearing the Respondent found it fit to terminate. 2. The Claimant was seen in CCTV footage played before the Court to have been involved in some suspicious behaviour. Whereas he was not found in possession of the cash (Kshs. 18,000/-) allegedly paid by the client, there was evidence he was a participant in the scheme that led to the Claimant being placed on interdiction and subsequent termination. He was seen entering the cash office, an area that was not within his scope as a radiologist. 3. The Claimant also executed a discharge voucher which in essence shows he was satisfied by the Respondent’s payment of final dues. His claim therefore was misplaced as there was no evidence of misapplication of the law or procedure in the termination and also because he promised the Respondent he would not sue to recover any other sum. The suit herein is accordingly not found to be merited and is dismissed with costs to the Respondent. It is so ordered. **Dated and delivered at Kisumu this 30th day of July 2026** **Nzioki wa Makau, MCIArb.** **JUDGE**