High Court (HC) on April 29 ordered State Trading Corporation Limited (STCBL) to compensate its former chief executive officer for unfair dismissal and pay him basic pay of Nu 80,000 for six months.
The court’s judgment stated that this was for the harassment and victimization. The company also has to pay the retirement benefits.
The CEO, Kinga Namgay had served only eight months when he was terminated. A total of 24 months of his term were left.
The company’s board dismissed him with retirement benefits on May 9, 2020 after a female employee filed complaints against him for sexual harassment.
Kuenga Namgay filed a case against the board but the Thimphu dzongkhag court dismissed it. He appealed to the High Court.
Kuenga Namgay accused the board of directors of not following the due process in terminating him and breaching the contractual agreement.
HC’s judgment stated that the sexual harassment complaint is a criminal case and it should be handed over to the police. The administrative action may be initiated after the investigation by the police.
“The board, terminating Kuenga Namgay based on the complaints by the employees and his confession to the complaints was against the criminal procedure,” the HC judgment stated.
The judgment also stated that the board of directors has not shared with him copies of complaints and the statements by the complainants against the CEO. The plaintiff was also not given the opportunity to rebut and no cross-examination was conducted.
“The investigation against Kuenga Namgay by the investigation team formed by his subordinates was an act of disrespect. It is in violation of the company’s service rules,” the judgment stated. It stated that the chairman of the board and the investigation team members, who did not refrain from investigating the case even after having a conflict of interest violated the STCBL’s rules and regulations.
The High Court judgment stated that the contract agreement between the CEO and the company required the CEO to be convicted of a misdemeanour or higher offence for him to be terminated from the company. “But the plaintiff was terminated based on the mere accusation of a petty misdemeanour offence.”
The board’s decision did not reflect the right to appeal and the time to appeal for Kuenga Namgay. It was also a violation of the CCPC and STCBL’s rules and regulations, the High Court judgment stated.