Former Family bank Managing Director Peter Munyiri Maina has been awarded Sh 30.6 million over unfair withholding of his dues by the Bank.
Justice Maureen Onyango of the Employment and labour relations court ruled that Munyiri is entitled to payment of gratuity for the years he worked for the Bank.
Munyiri was awarded the amount for five years as per the appointment letter.
“There is no dispute that Munyiri was employed by the bank on a fixed term contract running from July 15th 2011 to July 14th 2016,” ruled Justice Onyango.
The former MD moved to court seeking to be paid 57 million dues owed to him by Family Bank Limited.
He claimed the bank was unlawfully withholding dues rightfully owed to him as a result of the employee-employer that existed between himself and Bank.
He claimed that the terms of employment was a fixed term contract for a period of five years at the end of which he would be paid gratuity to be calculated at 10% of the gross basic for the year one of the the employment and there after the applicable rate will be aligned with the banking industry rate.
The applicant applied to rely on the rate of 31% that was applicable to national bank of Kenya and housing finance company limited which banks are under tire towards the Family Bank.
Munyiri stated that his contract lapsed on/or about 14th July 2016 and he was entitles to to gratuity of 30% of his gross salary which was the same as what was provided by other banks.
In response, Family Bank said that Munyiri was not entitled to the relief sought and urged the court to dismiss the same with cost.
The court heard that the application was based on erroneous, assumptions and extraneous gratuity rate covering wrong date.
The bank further argued that Munyiri was duly paid his dues at the time of separation save for gratuity and that the delay was occasioned by lack of standard banking industry rate.
It added that the 31% rate was not applicable but rather 18% of gross basic salary as per the report prepared Price Waterhouse Coopers (PWC).
“The two banks that the applicant is using as a benchmark are state owned and their gratuity is similar to the rate provided in parastatals,” argued the Bank.
