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Family bank has suffered a major blow after Employment and labour relations court has awarded it’s former CEO Peter Munyiri Maina Sh 30.655,800.00 over unfair withholding of his dues.
Justice Maureen Onyango awarded Munyiri the amount for five years as per the appointment letter.
The judge said there was no dispute that Munyiri was employed by the bank on a fixed term contract running from July 15, 2011 to July 14, 2016.
“There is further no dispute that Munyiri is entitled to payment of gratuity for the years he worked for the Bank,” ruled Justice Onyango.
Munyiri through lawyer Gibson Kimani had moved to court seeking to be paid 57 million dues owed to him by Family Bank.
He claimed the bank was unlawfully withholding dues rightfully owed to him as a result of the employee-employer that existed between himself and Family Bank.
Through lawyer Kimani, Munyiri further argued that he was employed by family bank on July 15,2011 as the Managing Director of the Bank.
He claimed that the terms of employment was a fixed term contract for a period of five years and 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 further added that his contract lapses on/or about July 14, 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.
Family Bank while responding to the case said that Munyiri was not entitled to the relief sought and urged the court to dismiss the same with costs as I is based on erroneous, assumptions and extraneous gratuity rate covering wrong date.
It added that the 31% rate is not applicable but rather 18% of gross basic salary as per the report prepared Price Waterhouse Coopers.
The bank further claimed that the two banks that Munyiri was using as a benchmark are state owned and their gratuity is similar to the rate provides in parastatals
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.
However the former boss is facing several criminal charges before the Milimani chief magistrate court for money laundering relating to Sh 1.6 million of NYS phase I scandal.
Munyiri, alongside six others who have all been sacked, including KTDA Branch Manager Robert Oscar Nyaga, was charged for the offence linked to the National Youth Service scandal.
Nine counts, including failure to report unusual transactions carried out by the chief suspect Josephine Kabura Irungu’s three bank accounts, were brought before the seven.
In the case they are each out on a Sh1 million bond or Sh300,000 cash bail.
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