An employee who successfully sued his former employer for unfair dismissal has been ordered to pay the same company more than Sh1.45 million after the court upheld a negligence claim against him in a rare ruling that underscores the risks of employment litigation.
In a judgment delivered by the Employment and Labour Relations Court, the court found that engineer Kenneth Mwangi had been unfairly dismissed by Multigraph Machinery (K) Ltd after the company failed to follow the legal process required before terminating an employee for poor performance.
The court ruled that although the employer had genuine concerns about Mwangi’s performance, it failed to comply with the mandatory provisions of the Employment Act governing disciplinary procedures and unfair termination. As a result, the court awarded him Sh241,668 in compensation for unfair dismissal.
However, the case took an unexpected twist. The employer had filed a counterclaim seeking Sh1.45 million, arguing that Mwangi’s negligent workmanship had caused costly damage to printing machinery, led to incorrect fault diagnoses, unnecessary purchases of spare parts and forced the company to fly engineers from India to repair the equipment.
While Mwangi denied the allegations in his court filings, he did not present evidence during the trial to rebut the employer’s claims. The court found the company’s evidence unchallenged and entered judgment in its favour for the full amount of Sh1,452,112.12.
The outcome means that although Mwangi won his unfair termination claim, he is now liable to pay his former employer more than six times the compensation awarded to him.
The decision highlights the distinction between procedural fairness in dismissal and an employee’s liability for losses caused during employment.
The court reaffirmed that employers cannot rely solely on allegations of poor performance to dismiss staff. Before termination, employers must set measurable performance targets, objectively assess an employee’s work, provide support through a Performance Improvement Plan (PIP), and conduct a fair disciplinary hearing in line with the Employment Act.
At the same time, the ruling signals that employees who pursue unfair dismissal claims remain legally accountable for any proven negligence or misconduct. Where an employer presents credible evidence in a counterclaim, failure to challenge it can result in substantial financial liability, even if the dismissal itself is found to have been unlawful.
The judgment is expected to serve as a key reference for employers and employees on the importance of following due process in performance management while also demonstrating that successful unfair termination claims do not shield employees from separate legal claims arising from their conduct.
