The Bhutanese Leading the way.
The Thimphu District Court has upheld the decision of the Board of the Bhutan Broadcasting Service Corporation Limited (BBSCL) to terminate its former Chief Executive Officer (CEO), Kaka Tshering, effective 15th February 2025.
Kaka was appointed as the CEO of the BBSCL for a three-year term. After completing his first term, he was reappointed for a second term on 5th October 2023 through a formal reappointment order (BBSC/Board/2023/517), and an employment agreement was signed on 1st October 2023.
However, on 16th January 2025, he received a termination notice from the BBS Board informing him that his contract would end in one month’s time.
The Board cited significant grounds for the decision, including the CEO’s reduced effectiveness in leading the organization, observations from oversight agencies such as the Anti-Corruption Commission and the Ministry of Finance, as well as findings from an Organizational Climate Index (OCI) exercise conducted between May and August 2024 and an Organizational Development (OD) Exercise review carried out from July to September 2024. The Board also referred to concerns raised by media professionals.
Kaka challenged this termination in the Court as unjustified and arbitrary. He claimed that BBSCL’s decision was influenced by a past allegation of sexual harassment, which had been reported to the Anti-Corruption Commission (ACC) and the police during his first term, but there was no case filed due to lack of evidence.
Kaka contended that the reasons stated in the termination notice, amounted to a disciplinary matter, and therefore he should have been subject to a formal disciplinary process under Chapter 15 of the BBSCL’s Internal Service Rules 2020.
He stated that his performance ratings from OCI and OD reports were positive and that those reports did not suggest any basis for his removal. He also pointed out that under the Corporate Governance Guidelines for State Enterprises 2019, a CEO can only be removed under specific grounds, none of which applied to his case. He claimed his termination violated the Corporate Governance Guidelines,2019 and principles of natural justice, particularly the right to be heard.
The BBSCL, in Court, maintained that Kaka was not terminated for disciplinary reasons but rather through “termination of contract” as provided in Chapter 10 of the BBSCL Service Rules 2020 (Section 10.8.1), which allows either party to end the contract by giving notice.
They clarified that if the termination had been for disciplinary reasons, the plaintiff would not have been entitled to post-service benefits. Since the notice to terminate explicitly confirmed the plaintiff’s entitlement to such benefits, BBSCL asserted that the termination could not be considered disciplinary.
BBSCL stated that they exercised their contractual right under Clause 18 of the employment agreement and Clause 3.18.2 of the BBSCL Service Rules, both of which are in line with Section 82 of the Labour and Employment Act 2007. This section permits either party to terminate an employment contract at any time by providing written notice only.
While they emphasized that the law does not require reasons to be stated, BBSCL nonetheless clarified that the plaintiff’s termination was not based on the previous allegation itself, but on the resulting loss of authority and effectiveness in his leadership role. They further referred to Section 124.5 of the Corporate Governance Guidelines, which permits removal of a CEO if their “conduct is found to be detrimental to the organization”.
They added that Kaka had been informed of the termination matter both informally, and in his capacity as a Board member, and that he had even submitted a letter requesting the Board not to proceed with the termination.
The Court held that the employment contract signed on 1st October 2023 was valid under the Contract Act and Evidence Act of Bhutan. It ruled that Clause 18 of the contract, Clause 3.18.2 of the BBSCL Service Rules, and Section 82 of the Labour and Employment Act 2007 lawfully permitted either party to terminate the contract by providing one month’s written notice, noting that the Defendant had complied with the termination provisions under the law and contract. Therefore, the termination was found to be procedurally valid.
The Court observed that, in practice, a clause allowing termination with notice only, can disproportionately affect employees, especially when vague or arbitrary reasons are given, potentially harming their professional reputation and future prospects.
However, the Court found that in this case, there was already an employment agreement executed between the parties, where a notice of 30 days prior to termination was the only requirement for terminating the contract.
The Court said Kaka was fully aware of the termination clause at the time of signing the contract and although he had the opportunity to object to the clause within 10 days as per the Evidence Act, he did not do so. In short, once he signed the contract and did not challenge it within 10 days after signing it meant he agreed to the contract terms including the one month notice period of either side. Thus, the Kaka was ‘estopped’ (legal doctrine that prevents a party from taking a position inconsistent with their previous conduct or a legal finding) from challenging the validity or fairness of the clause as per the CCPC, 2001. Accordingly, his request for reinstatement was denied.
The Court ordered BBSCL to provide the former CEO with all post service benefits, as stated in the termination notice as per the contract executed between the parties dated 1 October 2023, within one month from the date of judgment.
The Court dismissed the former CEO’s allegation of favouritism and biasness based on personal ties that some employees have with Board members, as the Corporation’s internal management issues and not related to the issue of the termination of his employment contract with the BBSCL. The Court said Kaka can institute a separate case or suit.
During court proceedings, Kaka had raised a comparison with the General Manager of BBS TV 2, who he alleged received a ‘fair’ OCI rating without facing repercussions.
Here, the BBS TV 2 General Manager told The Bhutanese that he is accountable to the CEO and if the former CEO felt the fair rating was not good enough then he should have asked him to improve either officially or in writing which was not done. The BBS TV 2 GM said, “If I had still not improved or performed then he could have taken my matter to the Board, and if at that time the Board did nothing then he can make allegations.”
“The former CEO never informed me that my fair rating was an issue and it was only brought up in court,” said the BBS TV 2 General Manager.
Kaka also raised a separate issue in Court involving the General Manager of News and Current Affairs, stating that her conduct should have been subject to disciplinary action. Here, the General Manager responded that the allegation made by the former CEO of her being involved in a disciplinary issue which the BBS Board failed to act upon is both unfounded and misleading.
She said, “The matter he refers to mainly pertains to a two-day leave of absence, for which I had duly issued an official office order, signed and sealed. The office order clearly stated that I would be out of station and that the Chief Editor would officiate in my capacity as General Manager of the News and Current Affairs Department during my absence. A copy of this document was formally submitted to the CEO. Despite this, the former CEO raised the matter during a Management Committee Meeting in an aggressive and confrontational manner, to which I appropriately responded. At no point was I issued a show cause notice or informed that the matter would be treated as a disciplinary issue. His failure to address it through proper internal procedures and his subsequent attempt to characterize it as a case of favouritism lacks merit and is not based on facts.”
