Court quashes Sh136m pension award to former NBK staff
Justice Roseline Aburili, in her ruling, faulted the tribunal for ignoring the replying affidavit filed by NBK’s Company Secretary, Habil Waswani, when making its decision.
Former employees of the National Bank of Kenya (NBK) have suffered a major setback after the High Court overturned a tribunal decision awarding them Sh136 million in pension dues.
The court ruled that the Retirement Benefits Appeal Tribunal did not accord the bank a fair hearing before delivering its judgment in 2017.
Justice Roseline Aburili, in her ruling, faulted the tribunal for ignoring the replying affidavit filed by NBK’s Company Secretary, Habil Waswani, when making its decision. She noted that this omission amounted to bias.
“Such a decision, which is one-sided whether by inadvertence or deliberately, gives rise to perceived bias which may justify interference by this court exercising judicial review jurisdiction. This is because the doctrine ‘audi alteram partem’, a Latin phrase that means ‘hear the other side’ or ‘let the other side be heard as well’, is a fundamental principle of natural justice and procedural fairness,” Justice Aburili stated.
In the contested ruling dated February 13, 2017, the tribunal had directed the NBK Staff Retirement Benefits Scheme and the NBK Staff Pension Fund Registered Trustees to pay 82 retirees their dues as assessed by NBC Valuers.
The order had adopted an actuarial valuation that placed the amount owed at Sh136 million.
The pensioners, all former NBK employees, had argued that their benefits were not computed in line with the trust deed and scheme rules. While they had initially received their pension upon leaving the bank, they maintained that the calculations were flawed.
Their case was first dismissed by the Retirement Benefits Authority, but the tribunal later allowed their appeal and ordered the payment.
The retirees then applied for a decree of Sh136 million and warrants of execution.
The decision by the High Court now nullifies the tribunal’s ruling.
NBK, which was acquired by KCB in 2019 and later sold to Nigeria’s Access Bank in March 2024, will no longer be compelled to release the disputed pension funds.
