The Employment and Labour Relations Court in Mombasa has ordered Absa Bank Kenya to pay its former branch manager Thomas Macharia Mwangi Ksh. 2,300,000 in unpaid bonuses for the year 2022.
The court also mandated Absa to implement a 13% salary increment for Mr. Macharia from January to May 2023, as per an earlier agreement, for his role as Nkrumah branch manager.
The court found that the bank’s decision not to award this increment was nullified by an established policy entitling employees to these specific percentages.
During the disciplinary process, spanning from March to May 2023, the court determined that Mr Macharia was not in full control of his employment status. The ruling stated, “The time taken to address the workplace misconduct should not deny him the due benefits while employment subsisted.”
The court noted that rights to employment benefits are safeguarded through contracts, policies, and workplace agreements.
It deemed Mr. Macharia’s claim for a 13% salary increment from January to May 2023 valid, amounting to Ksh. 647,218.
The judgement declared a breach of constitutional rights, awarding Mr. Macharia Ksh 5,000,000 in general damages, Ksh 2,300,000 for unpaid 2022 bonuses, notice pay of Ksh 647,218 and unpaid salary increments at 13% between January and May 2023, totalling Ksh 373,294.
The court further directed that Mr. Macharia be issued with a Certificate of Service, contingent on completion of clearance.
Mr. Macharia initially joined Absa on 14 February 2019 as branch manager of the Lavington branch, Nairobi, before being promoted to senior branch manager at the Nkrumah Road branch, Mombasa, on 29 March 2021.
The court heard that on 17 March 2023, he received a suspension notice signed by Serah Muthui, the Nyali branch manager, on behalf of Doufold Odanga, regional manager.
The suspension stemmed from allegations of Mr. Macharia’s involvement in irregular overdraft facilities at the Nkrumah Road branch, an action reportedly spearheaded by a junior officer suspected of fraud and data breaches involving client information.
Initially, the suspension was set for 30 days but was extended on 14 April 2023.
Subsequently, on May 2, 2023, Mr. Macharia received a notice to justify why his employment should not be terminated due to an investigation indicating unauthorised overdrafts for clients under his oversight.
He was directed to respond by 8 May 2023.
Absa alleged that Mr. Macharia had breached bank policies on numerous occasions by advancing unauthorised lending facilities to Safinah Petroleum and DM Kanyi.
On 4 May 2023, he submitted his response to the show-cause notice and was invited to a virtual disciplinary hearing scheduled for 7 June 2023.
Following the hearing, Mr. Macharia received draft minutes from Absa for review on May 17, 2023, but he contested that the minutes did not fully capture key discussions, a request the bank declined.
On 26 May 2023, his employment was terminated, and while he appealed the decision on 29 May 2023, Absa advertised his position before the appeal hearing was conducted.
The court ruled this as evidence of prejudgment against him, constituting an unfair and unlawful termination under Sections 41, 43, and 44 of the Employment Act.
The appeal hearing on 7 June 2023 again faced issues with incomplete minutes, and the bank refused further adjustments despite his objections. By 16 June 2023, Absa issued him a notice dismissing his appeal.
The court observed that Mr. Macharia’s termination was marred by nepotism and retaliatory actions for previous complaints he raised regarding three senior employees.
It also noted that a separate incident at a hotel on 6 April 2023 was used by the bank to characterise Mr. Macharia negatively, damaging his professional standing and making future employment difficult.
While managing the Nkrumah Road branch, Mr. Macharia was credited with achieving a net profit of Ksh 1.2 billion in 2022, entitling him to a Ksh 2.3 million performance bonus, which Absa withheld, alongside what he contended were malicious accusations to avoid paying the bonus.
At the time of termination, Mr. Macharia’s monthly salary was Ksh. 572,760, set to increase to Ksh. 647,218 under a 13% increment policy from January 2023.
The court ordered the bank to award this increment as stipulated in the policy, ruling that the termination had lacked due process.
The disciplinary panel included the Country Representative Head of Sales, Gunilla Ouko; Head of Retail, Beatrice Mwago; Digital Credit Officer, Elkana Momanyi; Senior Dealer, Fathiya Noordin; and Employee Relations Manager, Tabitha Mutwa.
