The 1st, 2nd and 3rd Claimants had been employed as Machine operator, Store Attendant and supervisor/Administrative Assistants until they were collectively terminated in 2020.

Court ruled on three issues namely (i) whether the Claimants were lawfully terminated? (ii) What was the 3rd Claimant’s employment status? and (iii) what remedies are available to the parties? The case is emphatic inter alia on collective termination, casual employees, fraud, abscondment, terminal benefits and damages.

Collective termination:

Court emphasised the law, procedure and reasons for collective termination which are all provided under s.81(1) Employment Act. The Court found that the Respondent was facing the adverse impacts of the COVID-19 lockdown particularly for a stationery manufacturer following the schools’ closure for a period of close to 2 years, therefore the Respondent had valid and reasonable economic reasons for the collective termination. Court found that the Respondent had adhered to the procedure requirements unders.81(1) Employment Act and the 1st and 2nd Claimants were lawfully collectively terminated.

The court reinforced the importance of complying with s.81(1) of the Employment Act regarding lawful collective termination. The judgement inter alia underlined that valid and reasonable economic reasons, such as those resulting from the COVID-19 lockdown, justify collective termination.

Casual employees:

The 3rd Claimant had worked for the Respondent from February 2017 to June 2020 at a weekly salary of UGX 87,600/=. Court found that the argument that the 3rd Claimant was a seasonal worker who would secretly leave work during the COVID-19 lockdown is not plausible and does not amount to abscondment. Court emphasised that abscondment means secretly leaving one’s usual place of abode or business to avoid arrest, prosecution, or service of process.

The Court considered a recommendation letter written for the 3rd Claimant which recognised that he was laid off due to collective termination. Court considered the provisions of Reg. 39 of the Employment Regulations and found that the Respondent employed the 3rd Claimant between 2017 and 2020, he was a Supervisor and Administrative Assistant, that ‘while the supervisory work in the binding section could be seasonal, it is hardly possible that the administrative assistant was seasonal.

Thus, the Court concluded that the Claimant was a casual employee and having worked continuously for more than four months, he ceased to be a casual employee and was entitled to a written contract. He too was entitled to all rights and benefits enjoyed by other employees of the Respondent.

The case clarified that being a seasonal worker does not necessarily constitute abscondment. It highlighted that abscondment entails secretly avoiding obligations, not seasonal employment. The ruling also established that continuous employment for more than four months mandates a written contract and access to employee benefits. Thus, one’s status as a casual employee ceases after four months of employment.

Terminal benefits:

Court awarded payment in lieu of notice which was previously denied to the 1st Claimant. Court found that he was not granted any hearing and thus the Respondent unfairly withheld the 1st Claimant’s notice pay. Court further found that the 3rd Claimant is entitled to all benefits at the layoff of other employees that is payment in lieu of notice and severance pay. Court declined to grant the 3rd Claimant any unpaid leave. It emphasised that the claimant for leave must prove that he applied for it and it was rejected.

Court also awarded general damages, interest on the award at 20% per annum. Court declined to award punitive and aggravated damages. Costs of the claim were awarded to the 1st and 3rd Claimants and denied to the 2nd Claimant. The justification was that the Respondent unlawfully withheld the 1st Claimant;s payment in lieu of notice and disregarded the 3rd Claimants rights. Court found no misconduct regarding the 2nd Claimant’s claim.

In a nutshell, the above case has far-reaching implications for employment disputes in Uganda. It highlights the legal requirements for collective termination, the rights of casual employees, the need for strict proof in fraud allegations, and the importance of granting employees their due process and benefits. Employers and employees alike must heed these implications, ensuring fair treatment and adherence to employment laws in future labour disputes.

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