Wakilii

Kimuli v Sanyu FM 2000 Ltd (Labour Dispute Reference No. 126 of 2015)

Industrial Court · [2019] UGIC 3 · 2019 Claim Allowed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Labour dispute reference arising from MGLSD 206 of 2014
Decision
Claimant's claim for unfair termination allowed with awards of general damages, payment in lieu of notice, repatriation allowance, and severance allowance

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Industrial Court held that termination by reason of restructuring without prior notice to affected employees is unfair under Employment Act s.73(b). Payment in lieu of notice does not cure the absence of prior knowledge or consultation. The employer must prove not only that restructuring occurred but that the termination was just and equitable. The claimant was awarded general damages, payment in lieu of notice, repatriation allowance, and severance allowance.

Outcome

Claimant's claim for unfair termination allowed with awards of general damages, payment in lieu of notice, repatriation allowance, and severance allowance

Facts

The claimant was employed by the respondent as an on-air presenter from 1 October 1999 at a monthly salary that increased over time to UGX 2,450,000 by October 2013. On 1 October 2013, the claimant was terminated with immediate effect due to an ongoing restructuring exercise. The termination letter offered 3 months' gratuity. The claimant contended he had no prior knowledge of the restructuring and that the termination was unlawful. The respondent argued the termination was lawful as it resulted from restructuring and payment in lieu of notice was offered. The claimant had worked for the respondent for 13 years.

Issues

  1. Whether the claimant was unfairly terminated from employment.
  2. What remedies are available to the claimant if the termination was unfair.

Orders

  • The claimant was unfairly terminated from employment.
  • The respondent shall pay the claimant UGX 5,000,000 as general damages for unfair termination.
  • The respondent shall pay the claimant UGX 7,350,000 as payment in lieu of notice (3 months' salary).
  • The respondent shall pay the claimant UGX 500,000 as repatriation allowance.
  • The respondent shall pay the claimant severance allowance equivalent to 1 month's salary per year for 13 years worked.
  • Each party shall bear own costs.

Rules and key headnotes

Unfair Termination — Restructuring — Requirement of Prior Notice to Affected Employees
In the event of restructuring, employees to be affected ought to have prior knowledge of the possibility of being terminated as a result of restructuring, and where they are not given prior knowledge, the subsequent termination is not just and equitable within the meaning of Employment Act s.73(b).
Termination — Payment in Lieu of Notice — Insufficiency to Cure Procedural Unfairness
Payment in lieu of notice does not suffice to lawfully discharge an employer from the obligation to provide a reason for terminating an employee and to act in accordance with justice and equity under Employment Act s.73(b).
Collective Termination — Compliance with Employment Act s.81
Termination as a result of restructuring affecting more than 10 employees over a period of not more than 3 months for economic, technological, structural or similar reasons must comply with Employment Act s.81, including informing a labour union representative and notifying the Commissioner of Labour.
Compensation for Unfair Termination — Industrial Court's Discretion
The Industrial Court is not bound by the three-month compensation limit in Employment Act s.78 applicable to labour officers, and may award compensation measured as damages at the court's discretion taking into account all circumstances with a view to putting the claimant in the position he or she would have been in had the dismissal not occurred.
Repatriation Allowance — Employees with 10 Years' Service
Under Employment Act s.39(3), employees who have worked for at least 10 years are entitled to repatriation allowance irrespective of the distance between home and the place of recruitment.
Severance Allowance — Calculation in Absence of Contractual Arrangement
Where the contract of service contains no arrangement for severance allowance as provided under Employment Act s.89, the Industrial Court may order severance allowance equivalent to one month's salary per year of service.

Legislation cited (15)

Cases cited (3)

  • Stanbic Bank v Kiyemba Mutale (Supreme Court Civil Appeal No. 2 of 2010)
  • Mufumba Florence v UDB (Labour Dispute Claim No. 138 of 2014)
  • Donna Kamuli v DFCU Bank (Labour Dispute Claim No. 002 of 2015)

Full judgment

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The original judgment as reported. Read the original PDF before relying on any passage.

Kimuli_v_Sanyu_FM_2000_Ltd_(Labour_Dispute_Reference_No._126_of_2015)_[2019]_UGIC_3_(15_March_2019)
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.