Equity Bank to pay former Bank of America expat Sh18m

Equity Bank has been ordered to pay a former expatriate executive close to Sh20 million in termination dues and pension after the Industrial Court sitting in Nairobi found that the bank had dismissed him unfairly.

Maurice Ewing, a US citizen, was sacked from the position of chief risk officer in 2012 following Equity Bank’s decision to shake up its top management just months after hiring him from the Bank of America.

The bank will pay Mr Ewing a total of $201,800 (Sh18 million) in compensation for his termination, pension, relocation and leave dues.

Equity had contested in court papers Mr Ewing’s demand for pension dues, saying he worked with the company for less than a year.

The bank’s policy is to pay departing staff the employer’s contribution of pension dues only after working for over a year.

Mr Ewing, however, argued that he was entitled to the employer’s contribution as his employment had been terminated unfairly.

Justice Nduma Nderi has ordered Equity Bank to re-calculate Mr Ewing’s pension and include the employer’s contribution despite him having worked at the bank for less than a year, as it would help to stop the bank from getting away with a wrongful act.

“This limitation cannot be used against an employee where employment is terminated by the employer through no fault of the employee. I therefore direct Equity to pay Mr Ewing for the pensionable period running from the end of the probationary period,” the judge ruled.

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The one-year period, Lady Justice Linnet Ndolo added, was intended to encourage employees to work at institutions for longer periods of time.

This means that in addition to the $191,300 (Sh17.02 million) for damages, relocation costs and pro rata leave, Equity will have to pay Mr Ewing a further $10,500 (Sh934,500) in pension.

Mr Ewing was earning $35,000 (Sh3.15 million) monthly from the bank at the time of his dismissal. He was hired on November 1, but was on probation until May 2012.

He wanted the court to award him pension for the nine months he worked for Equity, alongside an additional four months’ pension as compensation for wrongful dismissal.

The bank on the other hand maintained that he was on probation for six months hence could only claim pension for the three months he was in full employment.

“An employee cannot claim pension which is not earned. Consequently, Mr Ewing’s claim for pension for any period after the termination of his employment is without basis and is dismissed,” Equity held.

Justice Ndolo ordered that Equity only pay pension for the period after Mr Ewing’s probation expired, but to include the employer’s contribution, giving the bank some relief.

“I direct that Equity Bank shall recalculate the claimant’s contribution on the basis of his monthly salary of $35,000,” she added.

Mr Ewing moved to court after his dismissal, and won the first round of his legal battle with the bank in July, last year before winning the final round last week.