Standard Chartered Suffers Court Blow, Ordered to Pay Ex-Manager KSh2.68M

File image standard Chartered

The Employment and Labour Relations Court in Nairobi has ruled in favour of former Standard Chartered Bank branch manager Carolyne Mithano, awarding her KSh2.68 million after finding her termination unlawful.

In the case Mithano v Standard Chartered Bank of Kenya Limited (Cause E018 of 2021), Justice K. Ocharo Kebira held that Mithano’s dismissal in February 2018 was both procedurally and substantively unfair.

Mithano had joined the bank in 2013 as a branch manager in Nanyuki, earning a monthly salary of KSh275,000, which later rose to KSh335,000 at the time of her dismissal.

She told the court that her performance had consistently been strong throughout her tenure.

“Throughout my employment with the Respondent, my performance was thoroughly evaluated and consistently rated very highly. The various monthly incentives awarded to me are testament to this,” she said.

However, her relationship with her supervisor reportedly deteriorated, culminating in events that led to her dismissal.

The situation escalated in October 2017 when Mithano proceeded on leave and delegated duties to an acting branch manager. During that period, a sexual harassment complaint was raised by a member of staff.

Mithano maintained that she took steps to ensure the issue was handled.

“I impressed upon Mr. Mwangi to finalize the issue, as it had been reported to him directly. I kept tabs on the progress from time to time,” she told the court.

Despite this, she was later summoned to a disciplinary hearing and accused of failing to act on the complaint, breaching confidentiality, and creating a hostile work environment.

The bank further alleged that she had threatened a staff member and engaged in misconduct.

Mithano denied the claims, arguing that the process leading to her dismissal was flawed.

“The accusation was unfounded. I was not given a fair hearing. The Respondent didn’t conduct any investigations to establish the truth concerning the accusations against me,” she said.

In his judgment, Justice Ocharo found that the bank had failed to substantiate the allegations and did not follow due process in terminating her employment.

“Having noted that the Claimant’s termination was both procedurally and substantively unfair, I am convinced that the Claimant is entitled to compensation under section 49(1)(c) of the Employment Act to the extent of eight months’ gross salary, KSh2,680,000,” the judge ruled.

The court, however, declined to award general damages, noting that such relief is not provided for under the law.

“The Employment Act 2007 does not provide for general damages as a remedy for wrongful termination. I am not persuaded to grant the relief,” the judge stated.

The court ordered Standard Chartered Bank to pay Mithano KSh2.68 million in compensation, along with interest from the date of judgment until full payment, as well as the costs of the suit.

Mithano had initially sought a higher award equivalent to 12 months’ salary, amounting to over KSh7 million, alongside general damages and other reliefs.

In his ruling, Justice Ocharo emphasised that compensation in such cases is intended to address unfair dismissal rather than punish employers.

“Courts have asserted that the damages payable to the employee for unfair dismissal or termination is that which is equivalent to salary in lieu of notice and compensation awarded to the Claimant is not awarded to punish the employer,” he said.