Nairobi Hospital loses over Sh378million in months over unlawful sackings
The Nairobi Hospital, long regarded as one of Kenya’s premier private health institutions, is facing a deep governance and financial crisis following a string of costly court losses linked to the unlawful termination of its chief executive officers.
In just a few months, the hospital has been ordered to pay a staggering Sh378million in compensation to three former CEOs; Gordon Odundo (Sh72.9 million), James Nyamongo (Sh100 million), and Allan Pamba (Sh206 million) after the courts found that their sackings violated labour laws and due process.
These rulings paint a troubling picture of instability within the hospital’s leadership and governance structure as the institution risks sliding further into internal chaos.
The frequent hiring and firing of top executives point to deeper problems rooted in boardroom wrangles, lack of institutional discipline, and competing interests within the hospital’s management and board.
In the recent years, The Nairobi Hospital has been mired in internal feuds over control, procurement decisions, and alleged mismanagement.
In each of the three cases, the courts cited procedural unfairness and violation of employment contracts, suggesting that the hospital’s board failed to follow due process raising the hospital’s credibility as an employer and also signals possible lack of legal and ethical oversight.
Odundo is the latest ex-CEO to have been awarded Sh72.9million compensation by the court for wrongful sacking.
The Employment and Labour Relations Court found Odundo’s summary dismissal in 2019 unjustified and unlawful.
Justice Njagi Marete ruled that the sequence of events leading to Odundo’s sacking did not meet the requirements of substantive and procedural fairness as required in law.
Odundo had told the court that his sacking had been predetermined and that the hospital did not accord him a fair chance to defend himself.
The court noted that the atmosphere in which the CEO was operating had already been poisoned and soured after an attempted storming of his office by lawyers.
“A case of unfair and unlawful termination of employment therefore ensues in the circumstances, and I hold as such,” Justice Marete ruled.
The court awarded Odundo three-month’s salary in lieu of notice of Sh14million and 12 months compensation for unlawful dismissal amounting to Sh56million.
He was also awarded a refund for unlawful deductions amounting to Sh2,131,984 and another Sh422,100 being payment for outstanding and untaken leave. In total, the court ordered that Odundo be paid Sh72,904,094.
The judgment comes barely months after the hospital lost another case against another former CEO Nyamongo who was awarded Sh100 million for wrongful dismissal in August this year.
A few weeks ago, another former CEO, Pamba obtained a judgment directing the hospital to pay him Sh206 million for unlawful termination. Odundo who was hired in 2016 had been headhunted from Getrude’s Children Hospital where he was serving as CEO.
He said during the recruitment process, he was promised that his employment would last until retirement, a promise that he said made him resign from his job at Gertrude where he had been in employment for 13 years.
Odundo told the court that he was always willing, able and ready to serve the hospital on a renewed contract for four years that would have lasted until retirement. In December 2018 while in a meeting in his office, security officers accompanied by lawyers representing the hospital attempted to storm his office to remove him. The court noted that Odundo’s removal was dramatic and attracted attention that humiliated him.
The hospital had asked the court to dismiss the case saying Odundo had been sacked for gross misconduct after defying multiple directives to surrender personnel file therefore obstructing internal administrative processes.
