Nairobi — The Court of Appeal has upheld a finding that Consolidated Bank of Kenya unfairly dismissed a senior employee, ruling that the lender failed to follow its own disciplinary procedures and did not establish valid grounds for terminating his employment.

In a judgment delivered on July 10, the appellate court dismissed the bank's appeal and partly allowed a cross-appeal by former Business Development Officer Eustace Muchigiri Njuguna.

The court increased his notice pay from one month to three months' salary while retaining an award equivalent to six months' salary as compensation for unfair termination.

The dispute arose from Njuguna's summary dismissal in June 2014 over allegations that he had facilitated irregular transfers involving customer accounts.

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However, the judges found that the disciplinary process failed to clearly establish the allegations against him and that the bank breached its Human Resource Manual by allowing the Head of Human Resources, rather than the Chief Executive Officer, to sign the dismissal letter.

"We find that the trial Court did not err in law or fact in holding that the dismissal was unfair because the reasons for dismissal were not shown to exist as at the time of the disciplinary hearing. The Chief Executive Officer did not sign the dismissal letter as was required in the Manual," the judges ruled.

The court declined to order Njuguna's reinstatement, noting that the statutory period for such relief had lapsed, and also rejected his claim for salary covering the remainder of his employment contract.

It ordered Consolidated Bank to pay the costs of both the appeal and the earlier proceedings, with the revised notice pay award amounting to Sh349,511.