The Employment and Labour Relations Court in Kenya has upheld the decision by Bank of Africa to terminate the employment of a senior banking officer, Mary Wachira, over an erroneous Sh48 million foreign-exchange transfer to Dubai Bank Kenya Limited in 2015. According to the court, Wachira negligently approved the payment without independently confirming receipt of the corresponding funds. This decision was made despite Wachira's claim of unfair termination.
The labour dispute arose from a foreign-exchange transaction on July 2, 2015, involving six million South African rand. However, the original instructions referred to USD $6 million, leading to an error that resulted in the release of Sh48.1 million before the bank received the corresponding funds. The bank received a SWIFT message from Citibank New York requesting the purchase of $6 million, with Citibank South Africa indicated as the ordering institution.
Wachira and her team erroneously interpreted the transaction as a request by Dubai Bank Limited to purchase ZAR 6 million and failed to verify the transaction details. As a result, they forwarded it for approval. Wachira joined Bank of Africa in May 2007 and climbed the ranks to become a senior banking officer, overseeing foreign-exchange transactions and verifying their details before approval.
The court heard that Wachira's duties included verifying transaction details, but she relied on verbal confirmation from a colleague instead of checking the SWIFT advice slip and completing the necessary verification. The court held that the bank had established a valid reason for dismissal and followed due process, including a disciplinary hearing.
Wachira had argued that her acquittal in a related criminal case in July 2018 supported her position, but the court distinguished criminal proceedings from employment discipline. The court found that an acquittal did not determine whether her conduct justified dismissal. Additionally, the court allowed the bank's counterclaim for Sh9.7 million, the outstanding loan balance.
The bank had initially claimed Sh11.4 million, but Wachira disputed the debt, arguing that the bank had sold property securing her loans and failed to establish the remaining balance. The judge found the bank's counterclaim justified, ruling that preferential lending terms tied to employment ceased after her lawful dismissal.
The ruling is consistent with previous judgments in similar cases. In November 2023, the court awarded Faith Wairimu compensation equivalent to five months' salary after finding her termination unfair. In a separate November 2021 case, another employee, Robert Gatobu, won compensation after the court found he had been constructively terminated.
Key points
- The Employment and Labour Relations Court upheld Bank of Africa's decision to terminate Mary Wachira's employment due to negligence in a 2015 foreign-exchange transaction.
- The court found that Wachira's acquittal in a related criminal case did not impact the bank's decision to dismiss her for misconduct.
- The court also allowed the bank's counterclaim for Sh9.7 million, the outstanding loan balance, plus applicable interest and costs.
