We seconded one of our accountants to our affiliate company for one year. The seconded employee is assigned duties by the affiliate and his performance is audited by the affiliate, however we continue to pay him his salary and other remunerations payable under the contract of employment. The accountant is now being accused of defrauding the affiliate in the course of his duties. We would like to know who between us and the affiliate has power to take disciplinary action against the seconded employee. Please advise.
Since the accountant was not transferred to the affiliate but just seconded, he still remains your employee. There is a labour law principle that if you did not hire then you cannot fire. We understand section 61 of the Labour Institutions Act provides factors that can be used to infer an employee-employer relationship but in view of the facts you have provided, we do not think there is a need for drawing inference while there clear facts that the seconded employee was still under your payroll and remained your employee while he was working for the affiliate.
We are thus of the view that the intended disciplinary action can only be taken by you for the fraud committed against the affiliate. The affiliate will be a mere witness for the purpose of proving the disciplinary charges against the employee.