K&K Advocates

1

GENERAL PRINCIPLES

Forums For Adjudicating Employment Disputes

The Labour officer has the jurisdiction to entertain complaints or labour claims of infringement of the rights granted or obligations under the Employment Act and make orders to comply with the Act.

The Industrial Court has jurisdiction to arbitrate on references made by either the labour officer or a party to a claim where the dispute has not been disposed within eight weeks, and to adjudicate upon questions of law and fact arising from appeals from the decisions of the labour officer.

The right of appeal from a decision of the Industrial Court to the Court of Appeal arises only on a point or points of law.


The Main Sources Of Employment Law

The Constitution of the Republic of Uganda, 1995.

The Employment Act No. 6 of 2006.

The Employment Regulations,2011.

The Labour Unions Act No 7/2006 and Regulations SI 36/2006.

The Minimum Wages Advisory Boards and Wages Councils Act, Cap 221.

The Occupational Safety and Health Act, 2006.

The Workers Compensation Act, Cap. 225.

The National Social Security Fund Act, Cap. 222.

Income Tax Act, Cap 340.

The Labour Disputes (Arbitration and Settlement) Act, 2006,

The Labour Disputes (Arbitration and Settlement) (Industrial Court Procedure) Rules No. 8 of 2012.

The Employment (Employment of Children) Regulations No. 17 of 2012.

The Industrial Training Act, Cap. 130.

The Employment (Sexual Harassment) Regulations, 2012.

The Employment (Recruitment of Ugandan Migrant Workers Abroad) Regulations No. 62 of 2005.

The Uganda Citizenship and Immigration Control Act, Cap. 66. The Persons with Disabilities Act, 2019.

The Data Protection and Privacy Act, 2019.

Case law from the courts of judicature

 


National Law And Employees Working For Foreign Companies

The Employment Act applies to all employees in Uganda regardless of whether they are foreign or local. The Contract Act, 2010 also applies in regard to enforcement of the terms of employment within the contracts of service.


National Law And Employees Of National Companies Working In Another Jurisdiction

The Employment Act does not apply to employment outside Uganda. However, the Employment (Recruitment of Ugandan Migrant Workers Abroad) Regulations No. 62 of 20 seeks to protect and uphold the dignity and rights of Ugandan migrant workers through licensing of recruitment agencies and ensuring that they deploy Ugandans only in countries which have protective labour and social laws or are signatories to international agreements protecting the rights of migrant workers.


Data privacy

The Data Protection and Privacy Act, 2019 regulates the use of personal data in Uganda. The Act protects the privacy of the individual and of personal data by regulating the collection and processing of personal information; provides for the rights of the persons whose data is collected and the obligations of data collectors, data processers and data controllers; regulates the use or disclosure of personal information, and provides for all other related matters.

2

HIRING THE EMPLOYEE

Legal Requirements As To The Form Of Agreement

A contract of service unless required under any other law to be in writing maybe made orally. The Employment Act applies equally to oral and written contracts.

However, an employee is entitled under the Act to receive from the employer a notice in writing, in a form and language that the employee can reasonably be expected to understand, laying down particulars of employment including contract parties’ names and addresses, date of commencement, job title, place of work, wages, method of calculation and date of payment, overtime payment, working hours, annual or sick leave, and notice periods of termination.


Mandatory Requirements
  • Trial Period

    • The Employment Act provides for “probationary period” within the first 6 months of a contract of service. That period however maybe extended with the agreement of the employee for a further period not exceeding six months.

    The Act prohibits employment of a person under a probationary contract on more than one occasion.

  • Hours Of Work

    • Unless agreed upon in the contract of service, the maximum working hours for employees shall be forty-eight (48) hours per week; any excess hours in the absence of a written agreement to the contrary shall attract renumeration at the minimum rate of one and a half times of the normal hourly rate if the overtime is on working days, and two times the hourly rate where the overtime is on a public holiday.

  • Special Rules For Part-time Work

    • The law does not provide special rules for part-time work.

  • Earnings

    • The Employment Act provides that wages shall be paid in legal tender directly to an employee except where the employee expressly agrees for wages to be paid to another person.

    In the absence of a prior written agreement, wages shall be paid at the end of the period of engagement, that is if the employee is paid weekly he shall be paid at the end of that week.

    Currently, Uganda has no minimum wage as each Employer sets the renumeration payable under the contract subject to the consent of the worker. However, The Minimum Wages Advisory Boards and Wages Councils Act Cap 221 provides for Wage Advisory Boards and Wage Councils. The Act empowers the Minister of Gender, Labour and Social Development to set up such Boards or Councils through a statutory instrument to inquire into the existing wage rate and conditions of work and propose a minimum wage and/or employment conditions for a given set of employees or trade, industry or occupation for which the Minister feels there is a need to have such special regulations.

    According to the Act, the statutory minimum wage is fixed by a Wages Regulation Order which includes any order made by the President and the Minister based on the wage regulation proposals made by a board or council. The Minister causes the order to be published in the Gazette. Failure to adhere to such an order by the employer attracts criminal sanctions under which one maybe liable to pay fines on conviction.

  • Holidays/Rest Periods

    • According to the Act, the statutory minimum wage is fixed by a Wages Regulation Order which includes any order made by the President and the Minister based on the wage regulation proposals made by a board or council. The Minister causes the order to be published in the Gazette. Failure to adhere to such an order by the employer attracts criminal sanctions under which one maybe liable to pay fines on conviction.

    An employee shall not be required to work for more than 6 consecutive days without a day's rest which shall be a customary day or a day agreed on by the parties.

    The law stipulates a mandatory 21 days annual leave with full pay for every employee at a rate of seven days for each period of four months’ of continuous service which may be taken at such time as the parties to the contract of service may agree.

    Employees are also entitled to rest on every public holiday with full pay unless otherwise agreed, in which case the employee is paid not less than double a day’s wages in lieu of the holiday or some other day that would otherwise be a workday.

  • Minimum/Maximum Age

    • Employees are also entitled to rest on every public holiday with full pay unless otherwise agreed, in which case the employee is paid not less than double a day’s wages in lieu of the holiday or some other day that would otherwise be a workday.

    There is no maximum age though the retirement age for employees in public service is sixty years.

  • Illness/Disability

    • The Act stipulates that an employee normally employed for at least sixteen (16) hours a week who has been in continuous service with an employer for not less than a month, who falls sick or gets injured is, on proof of disability and / or notice to the employer, entitled to a full wage for the first month of absence from work. If the disability continues beyond two (2) months, the employer is entitled to terminate the contract of service after complying with all the terms of the contract.

    The Workers Compensation Act provides that it is mandatory for the employer to provide insurance for his/her employees. If personal injury arises out of or in the course of an employee’s employment, the employer shall be liable to pay worker’s compensation as per the Act. The Act provides for various forms of disability and the compensation due to each.

  • Location Of Work/Mobility

    • The employer is required to give the employee a written notice with the particulars of the place of work.

    An employee who has been in employment for at least ten years or is recruited to a place of work more than one hundred kilometres from the employee’s home has a right to be repatriated at the expense of the employer to the place of engagement upon termination of the contract of service either by agreement, expiry or disability.

  • Pension Plans

    • The law provides that all pensions, gratuities or other allowances granted to any Ugandan under the Pensions Act shall be charged on and payable out of the Consolidated Fund.

    An employee can consent in writing to allow an employer to deduct from the employee’s salary an amount in respect of a provident or pension fund or scheme maintained by the employer or other person.

  • Parental Rights (Pregnancy/ Maternity/ Paternity/ Adoption)

    • The law provides that a female employee shall as a consequence of pregnancy have a right to 60 working days maternity leave from work on full wages with a right to return to her job held immediately before leave or to a reasonably suitable alternative, but in any case not less favourable than those which would have applied had she not taken maternity leave.

    A father on the other hand is entitled to a period of four working days’ leave from work annually immediately after the delivery or miscarriage of a wife.

  • Compulsory Terms

    • The Employment Act provides that a provision in any agreement or a contract of service shall be void where it excludes or limits the operation of any provision of the Act to the employee's detriment or precludes any person from initiating and/or enforcing any proceedings under the Act.

    An employee is entitled to receive from his or her employer notice in writing in a language the employee is reasonably expected to understand of the following particulars of employment;

    • The full names and addresses of the parties to the contract of service.
    • the date on which employment under the contract began, specifying the date from which the employee’s period of continuous service for the purposes of this Act shall commence;
    • The title of the job that the employee is employed to do;
    • The place where the employee’s duties are to be performed;
    • The wages which the employee is entitled to receive or the means by which they can be calculated, and in either case, the intervals at which they will be paid, and the deductions or other conditions to which they shall be subject;
    • The rate of any overtime pay applicable to the employee;
    • The employee’s normal hours of work and the shifts or days of the week on which such work is to be performed;
    • The number of days’ annual leave to which the employee is entitled and his or her entitlement to wages during such leave;
    • The terms or conditions relating to incapacity for work due to sickness or injury, including any provision for sick pay;
    • The length of notice in excess of that provided by this Act required for lawful termination of the contract by the employer or employee; and
    • The terms or conditions relating to incapacity for work due to sickness or injury, including any provisions for sick pay
  • Non-Compulsory Terms

    • Freedom of contract also applies to employment contracts. The parties to a contract of service are free to agree on any other terms save those strictly stated to be mandatory under the law such as the prohibition of an agreement to relinquish the minimum annual holiday or to forego such a holiday, for compensation or otherwise is null and void.


Types Of Agreement

The law provides for freedom of contract in employment matters and the contract of service can be written or oral. The employment Act provides for the following types of contracts;

  • Apprenticeship contract with a set duration of not less than 3 months
  • Probationary contract with a set period of 6 months though duration may be extended by agreement.
  • Full time employment contract of service.
  • A contract for services.

Secrecy/Confidentiality

The duty of confidentiality is an implied term of the employment contract and applies to business information and trade secrets of the employer and may extend to the period after the employment relationship has ceased to exist. A clause on confidentiality may be expressly added to the employment contract.


Ownership of Inventions/Other Intellectual Property (IP) Rights

The intellectual property rights are governed by the Trademarks Act, 2010, Industrial Property Act, 2014 and the Copyright and Neighbouring Rights Act, 2006.

The law provides that where a person creates a work in the course of employment by another person or on commission by another person or body, in the absence of a contract to the contrary, the intellectual property in that work shall vest in the employer or the person or body who commissioned the work.


Pre-Employment Considerations

The law defines recruitment to include all operations undertaken with the object of obtaining or supplying labour of persons who do not continuously offer their services at the place of employment.

The Employment Act does not specifically provide for pre-employment considerations which are majorly left to the parties to negotiate. However, the Employment Act states that the employer has a right to determine any distinction, exclusion or preference in respect of a particular job based on the inherent requirements of that particular job.

The Employment Regulations provide that subject to inherent requirements of a particular job, an employer shall when advertising for vacancies encourage persons with disabilities to apply.


Hiring Non-Nationals

The Citizenship and Immigration Control Act regulates the employment of non-nationals in Uganda and makes it an offence for one to employ an illegal immigrant or one without a valid work/ entry permit.


Hiring Specified Categories Of Individuals

The law empowers the Minister for Labour to make regulations governing employment of special categories of employees such as children in employment, immigrant workers etc

The Employment (Employment of Children) Regulations regulate the employment of children. The law provides that a child under the age of 14 years may not be employed except for light work carried out under the supervision of an adult aged over 18 years which does not affect child’s education, is not harmful to a child’s health or development and is not more than 14 hours per week.

The Employment Regulations also provide for employment of other special categories of workers; persons with disabilities, apprentices, casual employees and employment of expectant mothers.

As regards persons with disabilities, the Regulations prohibit discrimination against persons with disabilities both at the point of interviews and in the course of employment. The Regulations also provide for where an employee is disabled in the course of employment. The employer is also required to file annual reports with the Minister of Labour where it employs persons with disabilities.

As regards apprentices, only people who are 17 years and above are allowed to be apprentices. They should be employed on a probationary basis for 3 months and under an apprenticeship contract thereafter. The regulations also provide for disputes arising in apprenticeship and transfer of apprenticeship contracts. As regards casual employees, no one is allowed to be employed as a casual employee for more than 4 months. The regulations also prohibit employers from giving expectant mothers harmful work.


Outsourcing And/Or Sub-Contracting/Temporary Agency Work

Outsourcing and agency work are regulated by a contract for services and not a contract of service. Usually, the employees remain workers of the subcontractor and the subcontractor has an independent contract with the party outsourcing.

3

MAINTAINING THE EMPLOYEE RELATIONSHIP

Changes To The Contract

Any proposed changes to a contract of employment according to the law must be mutually agreed upon by the parties and duly executed in writing. The Employment Act requires notice of the changes to be given to the employee.


Change In Ownership Of The Business

The law provides that a contract of employment can be transferred from one employer to another in case of change of ownership of the business subject to the consent of the employee and all rights and obligations shall remain the same as if there had been no transfer.


Social Security Contributions

The National Social Security Fund Act requires employers to make a monthly contribution of 15% of the monthly wages paid to an eligible employee to the fund. The Act defines an eligible employee to be one between 16 years and 55 years, not employed in exempted employment, not being a non-resident employee or employed outside Uganda. The employer is required to contribute 10% while the employee contributes 5%.

Furthermore, the law provides that employees who are pensionable under the law are exempted from contributing to the fund.


Accidents At Work

Under the Occupational Safety and Health Act, 2006, it is the responsibility of every employer to maintain the health, safety and welfare of his/her employees by ensuring the workplace and its vicinity is pollution free and that safe and risk-free means of access and exit from the workplace are in place.

In case of accidents, the Workers Compensation Act provides that if personal injury arises out of or in the course of a worker's employment, the employer shall be liable to pay worker’s compensation as per the Act. The Act requires the employer to report the accident to the Labour Officer and treat the employee for the injury and/ or disability sustained for the accident. The Act provides for rates for compensation due for the various disabilities that may arise from such accidents.


Discipline And Grievance

The Employment Act provides for disciplinary procedures and penalties to be imposed on an employee due to the employee’s neglect, failure to carry out his/her duties under the contract of service. The Act provides for different penalties for various types of misconduct and provides for escalation of the penalties in case of repetition of offences or gross misconduct. Disciplinary penalties can only be imposed where the employer is justified to do so, therefore the reason should be proved. An employee aggrieved by a disciplinary penalty imposed against him/her by the employer may within 4 weeks after imposition of the penalty make a written or oral complaint to the labour officer.

The disciplinary and grievance procedures may be agreed upon by the employer and employee and the same shall be binding on them, as long as the agreed upon procedures do not limit the provisions of the Employment Act to the employee's detriment.


Harassment/Discrimination/Equal pay

The 1995 Constitution of the Republic of Uganda states that all human beings are equal before the law and no person can be discriminated against on the ground of sex, race, colour, ethnic origin, tribe, birth, creed or religion, social or economic standing, political opinion or disability.

However, the Employment Act provides that any distinction, exclusion or preference in respect of a particular job based on the inherent requirements of that particular job does not amount to discrimination.

The Persons with Disabilities Act, 2019 prohibits employers from acts of discrimination against any person on the ground of a disability in all employment related matters including hiring, remuneration, promotion, and termination of contract.

As regards equal pay, the 1995 Constitution of the Republic of Uganda and the Employment Act provides for the right to equal pay for work of equal value.

The Employment Act sets requirements to safeguard against sexual harassment at workplaces. The Act requires every employer who employs more than twenty-five employees to have in place measures to prevent sexual harassment occurring at their workplace

The law protects employees against sexual harassment by employers or their representatives by implied or express actions or conduct that directly or indirectly subjects the employee to unwelcome or offensive behaviour or conduct that by its nature or by repetition has a detrimental effect to the employee’s job performance.

An employee who is a victim of sexual harassment at work can lodge a complaint with a sexual harassment committee at the workplace which shall investigate the complaint and respond with recommendations within 14 days from the date of lodging the complaint.

An employee who is sexually harassed in anyway under the law by the employer or employer's representative can also lodge a complaint with the labour officer who shall carry out investigations and make orders provided for under the law.


Compulsory Training Obligations

The law does not specifically provide a compulsory training obligation.


Offsetting Earnings

The Employment Act prohibits an employer from deducting the employee’s earnings except in respect of tax, rate, subscription or contribution imposed by law. Where the employee has previously given his written consent, a deduction may be made for contribution to a provident fund or scheme maintained by the employer of another person and reasonable rent or charge for accommodation of the employee or his family. Union dues may also be deducted in accordance with the Act.

The Act also permits attachment of wages by operation of the law for not more than two thirds of all the remuneration in that pay period.

The law prohibits the Employer from offsetting from the employee’s wages the cost of equipment, tools and any other materials necessary for the performance of the employee’s duties under the contract of service.


Payments For Maternity And Disability Leave

The law stipulates that maternity leave is granted with full pay for sixty days at the expense of the employer and may be extended by eight weeks after the birth or miscarriage in the event of any sickness arising out of the pregnancy affecting the mother or the child rendering the mother unfit/ unable to return to work within the stipulated time


Compulsory Insurance

The Workers Compensation Act, 2000 requires employers to insure their employees against injuries or scheduled diseases which may be acquired in the course of their employment.

The law further states that an employer who fails to insure his/ her employees commits an offence and is liable on conviction to pay a fine or to imprisonment.


Absence For Military Or Public Service Duties

The law does not make it mandatory for an employer to give an employee leave for military or public service duties.


Works Councils or Trade Unions

The 1995 Constitution of the Republic of Uganda provides for freedom of association. The Labour Unions Act provides that all employees have a right to establish and join trade unions of their choice outside working hours for the promotion and protection of their economic and social interests; collective bargaining and representation.


Employees’ Right To Strike

According to the Labour Union Act, strike is defined as an action to 'go slow' and 'a sit down' by a body of persons employed and acting in combination or a concerted refusal or a refusal under a common understanding, of any number of persons employed to continue to work for an employer in consequence of a dispute, done as a means of compelling the employer, or to aid other workers, to accept or not to accept terms or conditions affecting the employment.

The employees’ right to strike though recognized by the Constitution is regulated by law. Employees may organise themselves in any labour union and may withdraw their labour and take industrial action subject to a compulsory 30-day mediation period before lawful strike action may be taken.


Employees On Strike

According to the Employment Act, the participation or intended participation of an employee in a strike or other form of industrial action shall not constitute a fair reason for dismissal or the imposition of a disciplinary penalty where the strike or other industrial action is lawful.

Strikers must not threaten non-strikers. Strikers cannot stop other employees who want to go to work during a strike from doing so. Schedule 2 of the Labour Disputes (Arbitration and Settlement) Act, 2006 provides for a list of essential services where strike action is prohibited without written notice given to the employer, not earlier than 14 days from the intended strike and not later than 22 days from the intended collective withdrawal of labour. The Labour Disputes (Arbitration and Settlement) Act requires employers not to take civil action against the strikers. A Strike is considered illegal if it is not peaceful and does not comply with the provisions of labour law.


Employers’ Responsibility For Actions Of Their Employees

An employer is vicariously liable for the acts of his employees which are done while in the course of the employer’s business or within the scope of employment. This liability arises whether or not the acts are for the benefit of the employer. When the employee goes out to perform his or her purely private business, the employer is not be liable for any tort committed while the employee was on a frolic of his or her own.

4

FIRING THE EMPLOYEE

Procedures For Terminating the Agreement

The Employment Act requires an employer before reaching any decision to dismiss an employee on the ground of misconduct or poor performance to hear and consider any representations and defences to the alleged misconduct which the employee has made. The employee should be given a fair hearing and reasonable time within which to prepare his representations to the allegations.

At the disciplinary hearing, the law requires the employer to explain to the employee in a language the employee may be reasonably expected to understand, the reason for which the employer is considering dismissal and the employee is entitled to have another person of his or her choice present during this explanation.

A recent Court of Appeal decision has clarified that an employer is in some instances not mandated to give a reason or hearing before termination where the contract contains a clause allowing termination of the contract with notice or payment in lieu of notice.

The law therefore allows an employer to lay off an employee in accordance with the notice provisions in the employment contract and Section 58 (3) of the Employment Act or to make payment in lieu of notice without the need to state a reason for the termination.


Instant Dismissal

Instant or summary dismissal is dismissal without notice or with shorter notice that what is provided for under the law. An employer is entitled to dismiss summarily, and the dismissal is justified, where the employee has, by his or her conduct indicated that he or she has fundamentally broken his or her obligations arising under the contract of service.

The Employment Act requires an employer to accord an employee a fair hearing before forming a decision to dismiss summarily.

An employee who has been summarily dismissed without justification may within six months after the date of dismissal present a complaint to a labour officer who shall seek to settle the matter in the first instance by mediation or conciliation.


Employee's Resignation

Unless the contract of employment stipulates otherwise, the employee may terminate a contract of employment with or without notice as a consequence of unreasonable conduct of the employer or where he has received a notice of termination from the employer but before the expiry of the notice period.


Termination On Notice

A contract of employment may be terminated by either party by notice. Unless termination is under summary dismissal, notice is mandatory.

An employee may be terminated after the notice period or by the employer payment in lieu of notice due. The Employment Act provides for the following minimum notice periods:

  • 2 weeks for service of more than 6 months but less than 1 year;
  • 1 month for service of more than 12 months but less than 5 years;
  • 2 months for service of more than 5 years but less than 10 years;
  • 3 months for service of 10 years or more.

Termination By Reason Of The Employee's Age

Under the Pensions Act, termination of employment is deemed to take place where an employee attains the age of 60 years.


Automatic Termination In Cases Of Force Majeure

The law does not specifically provide for automatic termination of employment contracts in cases of Force Majeure. The Contracts Act generally provides for discharge of contracts by frustration.

An employment contract like any other contract maybe affected by force majeure. The Employment Act provides that in cases where the employer’s legal position formed the basis of the employment, the death of the employer shall cause the contract of service to terminate one month from the date of death.

The Employment Act further provides that it is the employer’s duty to provide work, except interruptions to his business are as result of natural calamities, a strike or other industrial action, or economical and technological reasons that result in reduction of work that is beyond the employer’s control. In these circumstances however, the employer is required to pay the employee at the same rate as if he had provided work.


Collective Dismissals

The Employment Act provides that where an employer contemplates terminations of no less than 10 employees over a period of not more than three months for reasons of economic, technological, structural or similar nature, the employer shall notify the representative of the labour union, if any, that represents the employees in the undertaking and notify the Commissioner for Labour in writing of the reasons for the termination, the number and categories of workers likely to be affected and the period over which the terminations are intended to be carried out.

The employer is required to give notice and pay the terminal benefits due to the employees in accordance with the law.


Termination By Parties’ Agreement

A contract of employment can be terminated mutually by agreement of the parties to the contract of employment so long as the agreement does not limit the operation of the provisions of the Employment Act to the detriment of the employee such as providing a termination notice period shorter than the one prescribed by law.


Directors Or Other Senior Officers

Employment of directors and other senior officers is regulated by the same employment laws that govern employment of junior staff.


Special Rules For Categories Of Employee

The Employment Act empowers the minister for labour on the recommendation of the labour advisory board to make rules and regulations applicable to the employment of special categories of employees who in his/her opinion are in need of special protection under the law.

The minister consequently enacted regulations for the special categories of employees such as the Employment (Employment of Children) Regulations to govern the employment of children below the age of 14 years and the Employment (Recruitment of Ugandan Migrant Workers Abroad) Regulations to protect the rights Ugandan workers desiring to work abroad.


Specific Rules For Companies in Financial Difficulties

The insolvency or winding up of an employer causes the contract of employment to terminate within one month of the commencement of insolvency or winding up order. However, where the business continues to operate or is transferred, the employee’s claim for wages will have priority over all other claims which have occurred during 26 weeks preceding the declaration of insolvency or winding up.

Where an employer is unable or refuses to pay wages, a labour officer shall declare the contract terminated on application of the employee without prejudice to any claim for wages and any other terminal benefits due to the employee under the said contract.


Restricting Future Activities

The Contracts Act provides that an agreement which restrains a person from exercising a lawful profession, trade or business of any kind, is to that extent void unless the restraint is reasonable in respect of the interests of the parties concerned and in respect of the public. The test for unreasonableness is if the restraint exceeds what is reasonably necessary to protect the proprietary interest of the employer.


Whistleblower Laws

Under the Whistle-blower Protection Act, a person must not be subjected to any victimization and/or occupational detriment by his or her employer or by any other person on account, or partly on account, of having made a protected disclosure. A whistle-blower is considered victimized on account of making a protected disclosure if he/she is subjected to a discriminatory or other adverse measure by the employer or a fellow employee.


Special Rules For Garden Leave

The law does not provide for Garden leave following resignation or termination of employment.


Severance Payments

The Employment Act provides for payment of severance allowance. The amount is subject to negotiation between the employer and the employee under the contract and where the contract of employment is silent, the Courts have now determined that the amount due and payable should be computed at a rate of 1 month’s pay for each completed year of service.

An employee who has been in continuous service for at least 6 months is entitled to severance pay in any of the following circumstances:

  • Unfair dismissal of the worker by the employer;
  • Death of the employee at work not attributable to his own serious and wilful misconduct;
  • Termination by the employee due to physical incapacity not attributable to his own serious or wilful misconduct;
  • Termination by reason of the death or insolvency of the employer;
  • Termination by a labour officer following the inability or the refusal of the employer to pay wages;

Severance allowance is not payable where an employee is on probation, or where he has been summarily dismissed with justification or when an employee is first dismissed but later is offered reemployment which he/she unreasonably refuses. It is also not payable to an employee who abandons his employment and absconds the workplace for a period of more than 3 days without any explanation given to the employer.


Special Tax Provisions And Severance Payments

The Income Tax Act provides for taxation of employment income defined under the law to include any amount derived as compensation for the termination of any contract of employment whether or not provision is made in the contract for the payment of such compensation, or any amount derived which is computation of amounts due under the contract of employment.


Allowances Payable To Employees After Termination

The Employment Act provides that an employee is entitled to all benefits arising under his/her employment contract and upon termination, an employer is obliged only to pay the terminal benefits accruing from the contract of employment and not after termination.


Time Limits For Claims Following Termination

The general timelines for filing claims under the law are stipulated under the Limitation Act which stipulates 3 years for claims arising under contract.

However, the employment Act provides that an employee who has been continuously employed by his or her employer for at least 13 weeks immediately before the date of termination, shall have the right to complain that he or she has been unfairly terminated vide a complaint to a Labour officer within three months of the date of dismissal, or such other period as the employee shall show to be just and equitable in the circumstances.

In instances of summary dismissal without justification, the law provides that the employee has 6 months from the date of dismissal within which to lodge a complaint with the labour officer and where in both cases, the labour office does not dispose of the claim within 90 days of submission, the claimant may proceed to the industrial court.

5

GENERAL

Specific Matters Which Are Important Or Unique To This Jurisdiction

In Uganda, termination can be regarded as unfair, unlawful and wrongful. In some cases, it may be one or all of the three instances.

The Employment Act provides for the criteria for unfair termination and provides for various reasons which should not constitute fair reasons for dismissal.

In the case of wrongful termination, the courts have held that a dismissal is wrongful if it is made without justifiable cause and without notice. A wrongful dismissal occurs when an employer terminates the employment of an employee in a manner that fails to comply with the law.

On the other hand, courts have defined unlawful termination to the extent that an employer may terminate the employee's employment, however, the employer must do so according to the terms of the contract, otherwise he would suffer the consequences arising from failure to follow the right procedure of termination.

The Court of Appeal has recently determined that the doctrine of legitimate expectation is applicable in employment law. The Court of Appeal held that the actions of the Appellant had unlawfully caused financial loss and mental anguish to the Respondents, because they had a legitimate expectation of a retirement package upon their retirement, which the appellant did not honour by prematurely terminating them unlawfully.



Search by:
Need more information?
Contact a Contributing Author:
Ms. Atugonza Flavia Anna
K&K Advocates
Uganda


Ms. Nankunda Pheonah
K&K Advocates
Uganda


Disclaimer:

© 2021, K&K Advocates . All rights reserved by K&K Advocates as author and the owner of the copyright in this chapter. K&K Advocates has granted to Multilaw non-exclusive worldwide license to use and include this chapter in this guide and to sublicense Lexis Nexis, a division of RELX Inc. and its affiliates certain rights to use and distribute this Guide.

The information in the How to Hire and Fire Guide provides a general overview at the time of publication and is not intended to be a comprehensive review of all legal developments nor should it be taken as opinion or legal advice on the matters covered. It is for general information purposes only and readers should take legal advice from a Multilaw member firm.

Publication Date: June 2021