https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/1748

Wanjala v Imani Colelctve Ltd (Cause E129 of 2025) [2026] KEELRC 1748 (KLR) (25 June 2026) (Judgment) Neutral citation: [2026] KEELRC 1748 (KLR) Republic of Kenya In the Employment and Labour Relations Court at Mombasa Cause E129 of 2025 M Mbarũ, J June 25, 2026 Between Kelly Wanjala Claimant and Imani Colelctve Ltd Respondent Judgment 1.The respondent employed the claimant on 1 January 2023 as a production manager at a monthly salary of Ksh. 150,000. On 1 January 2024, he was promoted to operations manager, earning Ksh. 260,000 per month. 2.The claim is that in July 2025, the respondent’s chief executive officer (CEO), Ms Jenny Nuccio, raised concerns about working from home, which had earlier been implemented with her approval; therefore, all employees were to resume working from the office. In an email dated 31 July 2025, the CEO noted that, from 1 August 2025, everyone was to resume working from the office. The installation of CCTV cameras and biometric systems followed. 3.The CEO would hold weekly meetings on Tuesdays to track operational progress. 4.On 31 July 2025 at 2 pm, the CEO sent a message via the office WhatsApp group stating that all employees should NOT report to work on Friday, 1 August 2025, and that all computers and devices should be returned to her by 3 pm. 5.The CEO also asked all employees to report to work on Monday and to ensure they are available for one-on-one sessions at the indicated time. The claimant’s meeting was scheduled for 1.30 pm. 6.On 1 August 2025, the CEO called a few people to the office and indicated that these would be retained, but the rest would have their employment terminated. 7.The claim is that the claimant lost his father on 3 August 2025. He reported to the CEO that he would be unable to attend the meeting scheduled for 1.30 pm on 4 August 2025. Despite the communication, the CEO proceeded to hold the meeting in the claimant's absence, conduct a disciplinary hearing, and issue a notice of summary dismissal. The claim is that there was no due process and that the manner of termination was unlawful and unfair. The claimant is seeking the following:a.12 months' compensation Ksh. 3,588,000.b.House allowance once for 12 months, Ksh. 270,000.c.House allowance for 19 months Ksh. 1,011,000.d.Certificate of service.e.Costs of the suit. 8.The claimant testified in support of his case that, before his summary dismissal, the respondent sent him a message, but did not indicate that it was a disciplinary hearing. There was nothing indicated that he was to respond to any allegation of gross misconduct. The message sent on 4 August 2025 stated that he had failed to attend the meeting. However, the claimant had communicated that he had lost his father on 3 August 2025, but such a matter was not taken into account. 9.The claimant testified that the respondent accused him of approving off-site work arrangements for employees, but the CEO had actually approved them. A schedule was followed and approved by the respondent. 10.The claimant testified that he was also accused of staff harassment. No such matter was brought to his attention before the summary dismissal. No complaint was brought to his attention that any person had made a complaint of harassment or intimidation. 11.On 4 August 2025, when the claimant received the notice of summary dismissal, he lodged a complaint with the CEO regarding the lack of due process. There was no response from the respondent. 12.The respondent also accused the claimant of increasing his salary without approval. The salary was increased from Ksh. 150,000 to Ksh. 260,000 per month. The Chief Operating Officer (COO), David Mwangi, received a salary increase. The claimant did not increase his own salary, and whatever the COO did was approved by the CEO. He was also promoted, and hence the salary increase was justified. 13.In response, the respondent admitted that the claimant was employed as a production manager and then promoted to operations manager. However, the salary paid included the house allowance and was therefore consolidated. 14.Working from home was not approved, and the respondent had no such policy in place. The claimant, in gross abuse of his senior management position, unilaterally implemented an unapproved work-from-home arrangement without the CEO’s approval. 15.The termination of employment was not premeditated as alleged. The respondent received communication from the claimant on bereavement on 3 August 2025. However, the decision to summarily dismiss the claimant was necessitated by the gravity of the findings in a comprehensive Internal Risk Assessment and Audit Report concluded in July 2025. The audit uncovered breaches of fiduciary duty, including unapproved payroll changes and salary adjustments executed by the claimant without authorisation. There were financial leakages, non-compliance with internal controls, absenteeism, and failure to maintain standard operating procedures. There was staff discrimination and related contract renewals. 16.The response is that the claimant was accorded a fair labour process and afforded 17.a right of reply. The decision to terminate employment was sent through email, and the claimant acknowledged receipt. 18.Under section 44 of the Employment Act, a warrant for gross misconduct can be issued without notice. The claimant’s action constitutes a constitutional fundamental breach of the employment contract, fiduciary duty, and trust reposed in a senior manager. Although the claim was breached, the employment relationship had become untenable due to the claimant's conduct, which exposed the respondent to significant financial loss and regulatory risk. 19.The claim for the unpaid house allowance is denied. The claimant accepted a consolidated salary. Upon dismissal, the respondent paid the claimant terminal dues, including a severance pay of Ksh: 260,000 and all accrued leave days. 20.In evidence, the respondent called David Kinyajui Gikonyo, who testified that in April 2025, the respondent employed him to strengthen the internal controls and the book of accounts. He did an internal audit and risk assessment. The investigations revealed a lack of systems and controls, especially in production, costs of goods sold and stock valuation. There was no tracking. Some employees had no contracts in place. The production manager signed contracts for some employees instead of the human resource officer. 21.The investigations revealed that financial records from January 2024 to July 2025 showed a pattern of gross financial mismanagement and unauthorised actions by the claimant, who was the operations manager. He had an unauthorised salary adjustment, in which his salary was increased without the CEO's approval. The claimant did not apply standard operating procedures. He used a ghost policy of work-from-home arrangements. 22.Gikonyo testified that he presented his report to the CEO, including digital trails, payroll logs, and evidence of the lack of corresponding authorisations. From a financial and accounting perspective, the claimant’s actions constituted a fundamental breach of his fiduciary duty to the respondent. The unauthorised diversion of company funds through payroll adjustments is a terminable offence in any professional setting. 23.Gikonyo testified that the claimant had failed to keep records for his duties. He failed to enforce basic controls, and his claims are not justified. The house allowance is not due since there was a consolidated salary. At the end of employment, the claimant was paid a severance package. 24.The respondent also called the CEO, Ms Jenny Nuccio, who testified that the claimant was promoted, but his salary remained the same. No increase was approved as alleged. She appointed Gikonyo as head of finance to help assess the effectiveness of the governance structure. He conducted investigations which revealed material breaches by several employees, including the claimant. He implemented an unapproved salary increase and payroll changes without authorisation. He unilaterally imposed a work-from-home arrangement without approval, resulting in the collapse of operational oversight. 25.The claimant also failed to adhere to standard operating procedures, creating operational risks and exposing production. He did not keep an inventory for management. This was in breach of his role as a senior operating manager for the respondent. 26.Ms Nuccio also testified that the claimant engaged in discriminatory practices against employees in connection with contract renewals. He exposed the respondent to potential third-party litigation. 27.Ms Nuccio testified that she expressed openness to flexible work arrangements, but the claim proceeded to allow off-site work arrangements before approval. As a senior manager, the claimant had a duty to seek the CEO's approval before implementing a fundamental shift in company operations. 28.On 31 July 2025, following an audit finding, the CEO scheduled a hearing with the claimant for 4 August 2025. This was to allow him to respond to the grave allegation made against him. 29.On 3 August 2025, the claimant informed the CEO that he was bereaved. He had lost his father. As much as she sympathised, the audit findings necessitated the claim to attend the scheduled meeting, which he failed to do, resulting in a notice of summary dismissal. The respondent complied with the law permitting summary dismissal for a fundamental breach of the employment contract. The decision was a protective measure against further financial loss resulting from the claimant's conduct. 30.The claimant was paid his terminal dues, including a severance package of Ksh. 260,000. The matter was reported to the labour officer, and the claim was found to be without merit. 31.At the close of the hearing, parties filed written submissions. These are analysed in the findings. Determination 32.Through a notice dated 4 August 2025, the respondent terminated the claimant’s employment through summary dismissal. The respondent noted that following internal audit and reviews, employment was terminated with immediate effect. The respondent noted that such a decision had been arrived at upon review and due to:Verified instances of gross misconduct, as per internal policy and code of conduct.The matters remain under further internal investigations and have been documented accordingly. 33.Indeed, as the respondent has submitted, under section 44 of the Employment Act (the Act), the employer has the right to terminate employment by summary dismissal where the employee breaches a fundamental provision of the employment contract. Equally, where the employee is guilty of gross misconduct, summary dismissal is allowed. 34.However, the rights under section 44 of the Act are subject to the provision of section 41(2) of the Act:(2)Notwithstanding any other provision of this Part, an employer shall, before terminating the employment of an employee or summarily dismissing an employee under section 44(3) or (4), hear and consider any representations which the employee may on the grounds of misconduct or poor performance, and the person, if any, chosen by the employee within subsection (1), make. 35.The subject employee must be accorded due process. What is called the procedural fairness and justice before the employer can invoke the right to summary dismissal. However short the notice may be, the employee should be allowed to hear the allegations made against him and respond. The employee must be allowed to have another employee of his choice. 36.In this case, the respondent, by a notice dated 31 July 2025, invited the claimant to attend a meeting on 4 August 2025 at 1.30 pm. The notice did not indicate the purpose. 37.The claimant’s case is that he lost his father on 3 August 2025. He wrote to the 38.respondent about this loss. He therefore did not attend the meeting scheduled for 4 August 2025. 39.While the loss of a parent is traumatic, absence from work should be authorised by the employer. Any unauthorised absence amounts to an unwelcome absence from duty, which justifies summary dismissal. 40.The loss of the claimant’s father does not justify absence from duty without the employer’s approval. Such absence did not justify the failure to attend work as directed by the employer. 41.However, this was not the reason the respondent applied to terminate employment. The reasons related to financial and operational allegations. The respondent, through Gikonyo, had conducted an audit that revealed various matters against the claimant. These were not brought to his attention before 4 August 2025, when he was expected to attend a meeting with the CEO. 42.Ms Nuccio admitted in evidence that she did not inform the claimant of the purpose of the meeting to be held on 4 August 2025. However, the claimant was already aware that the respondent had called some employees to the office on 1 August 2025 and indicated to them they would be retained, while the others not invited would be dismissed. The claimant’s non-attendance at the meeting on 4 August 2025, under the allegation that his father had died, was not approved. If there indeed was such a death, the certificate thereof is the legal evidence of that fact. 43.Both parties failed to adhere to the required workplace standards. The respondent, as an employer, did not comply with the mandatory provisions of section 41(2) of the Act. No notice was issued to the claimant to attend, and the allegation he was required to address. The claimant absented himself from work without authorisation, contrary to section 44(4) (a) of the Act. 44.The respondent was in breach of a fundamental provision of the law. The claimant frustrated his employment through unauthorised absence. 45.At the end of his employment, the claimant was paid a severance package which was not due.Such well-compensated him. 46.A claim for notice pay or compensation for unlawful termination of employment was weighed under section 45(5) of the Act; any further payment would reward gross misconduct. The severance package shall suffice. 47.Regarding the house allowance claim, the claimant was not a protected employee. His salary was paid over and above the minimum wage. Section 31 of the Act allows a consolidated salary/wage. 48.The employment contract allowed a salary of Ksh. 150,000. The claimant was paid Ksh. 260,000 per month, which comprised the reasons for the summary dismissal. No letter has been issued to review the salary from in Ksh. 150,000 to any other. The payment of additional salary was not justified; hence, the claimant cannot claim what was neither approved nor authorised by the employer. 49.ON the claim for a certificate of service, this is due at the end of employment and shall be issued upon clearance. 50.On costs, the claim is without merit. The findings above place each party at fault. Awarding costs would not foster the proper administration of justice. 51.Accordingly, the claim is without merit and is hereby dismissed. Each party shall bear its costs. DELIVERED VIRTUALLY THIS 25TH JUNE 2026.M. MBARŨJUDGEIn the presence of:Court Assistants: Nelson Kemboi, Catherine Makau and Shamsi Omar……………………………………………… and………………….…………………………...