The Employment and Labour Relations Court in Nairobi has upheld a decision by Consolidated Bank to dismiss its ICT head over interference in the procurement of a core banking system meant to modernise the lender’s operations.
The court found that the bank had valid grounds to terminate Martin Omido and followed due process, dismissing his claim for damages and compensation for unfair termination. It also ordered a partial refund of deductions made from his terminal dues.
Mr Omido was fired in February 2023 after internal and external audits found that he, alongside another senior official, had interfered with the procurement of a new core banking system at the State-owned lender. He had served as head of Information Communication Technology (ICT) since 2016.
The alleged misconduct included shaping technical specifications that favoured a particular bidder, repeatedly challenging the work of evaluators through a series of memoranda, and later supporting a switch to direct procurement in a process in which he participated.
Audits — including a review by PricewaterhouseCoopers dated December 16, 2022 — concluded that his actions breached procurement law and the bank’s internal procedures, exposing the lender to financial, operational and reputational risks.
Dismissing his claim, the court said the termination was directly linked to Mr Omido’s conduct and was justified under the Employment Act.
Mr Omido had sued the bank, arguing that his dismissal was unlawful and discriminatory, that he was not given the audit reports relied upon by the bank, and that his role was limited to collating user requirements. He said the memoranda he authored were merely advisory and written at the request of the then acting chief executive.
However, the court rejected that defence, finding that the audits showed he had adopted a “top-down approach” that aligned system specifications with one bidder. It also found that he challenged the evaluation committee and later recommended direct procurement in favour of MFI Technology Solutions Limited, while also participating as a member of the evaluation team.
“The claimant’s conduct, as documented, amounted to interference with procurement processes, contrary to the Public Procurement and Asset Disposal Act and the respondent’s procedures,” the court said.
“As head of ICT, his role was limited to collating user requirements. He had no mandate to evaluate or challenge the evaluation committee’s work.”
The court concluded that the dismissal was both substantively and procedurally fair.
“Having found that the termination was grounded on a valid reason and that a fair procedure was followed, I hold that the claimant is not entitled to a declaration that the termination of his employment was unfair and unlawful,” the court said, adding that he was also not entitled to compensation.
The dispute arose from a troubled attempt by the bank to replace its core banking system, whose licence was due to expire in May 2022.
An open tender launched in July 2021 attracted nine bids and initially recommended Inlaks Computers Limited, according to court records.
However, the process stalled after the acting chief executive declined to approve the award, following several memoranda from the head of ICT challenging the evaluation on issues such as database costs, system requirements and evaluation criteria.
The bank later cancelled the tender as “non-responsive” and opted for direct procurement, awarding the contract to MFI Technology Solutions in May 2022. The contract was terminated in June 2023 for non-performance.
Following the procurement, the bank commissioned internal and external audits, which flagged irregularities and interference and implicated both Mr Omido and the acting chief executive.
Based on those findings, the bank issued Mr Omido a show-cause letter on December 21, 2022, suspended him on half pay, and convened a disciplinary hearing on January 31, 2023, before dismissing him two weeks later.
“The respondent’s decision to terminate was based on a genuine belief in the claimant’s misconduct,” the judge said, adding that the bank had met the legal threshold required under the law.
The court also rejected claims of discrimination, noting that the acting chief executive was dismissed on the basis of the same audit findings.
However, the judge faulted the bank for deducting money from Mr Omido’s terminal dues over the loss of point-of-sale devices.
The bank had surcharged him about Sh911,200 but failed to justify the figure or prove liability, and had not filed a counterclaim. The court ordered the bank to refund Sh872,961 plus interest.
