Wakilii

Mwagale and 8 Others v Bugweri District Local Government (Labour Dispute Reference 15 of 2022)

Industrial Court · [2023] UGIC 23 · 2023 Application Partly Allowed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Labour dispute reference arising from labour complaint before the Industrial Court
Decision
Claim partially succeeds. Claimants awarded salary arrears for period worked but not entitled to other remedies including general damages, aggravated damages, severance allowance, payment in lieu of notice, or punitive damages.

Observed later treatment

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Holding

The Industrial Court held that while the claimants were employees of Minani Health Centre III before its takeover by Government, their contracts were not automatically transferred to Bugweri District Local Government under Employment Act s.28. The court ruled that transfer to public service required compliance with Public Service Standing Orders, including application to the District Service Commission. The claimants' refusal to apply through the advertised recruitment process meant their contracts were not transferred. However, they were entitled to payment for services rendered from the takeover date until the application deadline at their previous salary rates.

Outcome

Claim partially succeeds. Claimants awarded salary arrears for period worked but not entitled to other remedies including general damages, aggravated damages, severance allowance, payment in lieu of notice, or punitive damages.

Facts

The claimants were employed by Minani Health Centre III, a private entity, from 2017 in various capacities. On 12 December 2017, Namalembe Sub County Council resolved to hand over the Health Centre to the Ministry of Health. Government formally took over on 1 July 2018. The claimants contended that the respondent promised their contracts would be automatically transferred to Government service. The District Health Officer and Chief Administrative Officer attempted to transfer the contracts. The CAO undertook to pay rent and bills while the claimants continued working. On 29 April 2022, a mediation meeting informed claimants they needed to apply to the District Service Commission. The respondent advertised positions under External Advert No.02/2021 with deadline 22 February 2022. Claimants were given extended deadline of 6 May 2022 but declined to apply, expecting automatic absorption. They were terminated on 2 November 2021.

Issues

  1. Whether or not the claimants were employees of Minani Health Centre III.
  2. Whether or not Minani Health Centre III was taken over by Government.
  3. Whether or not the Claimants' contracts of service were transferred to Bugweri District Local Government upon the take over.
  4. Whether or not the Claimants' contracts of service were terminated unfairly.
  5. What are the remedies available to the parties?

Orders

  • Declaratory order that the Claimants' contracts were not transferred to the Respondent having not complied with the required procedure under the Public Service Standing Orders.
  • The Claimants shall be paid their salaries for the period 1/07/2018 to 6/05/2022 at the rates held under Minani Health Centre before takeover: Mwagale Ali at UGX 550,000 per month; Mugona Paul at UGX 550,000 per month; Nabirye Edith at UGX 420,000 per month; Sooma Andrew at UGX 550,000 per month; Nakasolo Moreen at UGX 420,000 per month; Katono Betty at UGX 420,000 per month; Colline Katambala at UGX 420,000 per month; Kyakulaga Robert at UGX 420,000 per month; Nyiiro Bernard at UGX 420,000 per month.
  • The Claimants are not entitled to any other remedies claimed.
  • No orders as to costs.

Rules and key headnotes

Transfer of Undertakings — Automatic Transfer of Contracts — Application to Public Service
Section 28(2) of the Employment Act 2006 provides for automatic transfer of contracts where a trade or business is transferred, but this does not preclude a new employer from varying terms and conditions to bring them into conformity with the requirements of the new employment, particularly where the transfer is from private sector to public service.
Transfer of Undertakings — Employee Consent — Expression of Consent
Although Section 28(1) of the Employment Act requires employee consent before transferring a contract of service from one employer to another, the law is silent on how consent should be given. Consent may be expressed by the employee subjecting themselves to the process which would bring them into conformity with the terms and conditions of the new employer.
Public Service — Appointment Procedures — District Service Commission
Appointment to the public service must follow procedures laid down in the Public Service Standing Orders. Where a private entity is taken over by government, employees cannot be automatically absorbed into public service without complying with recruitment procedures, including application to the District Service Commission as the appointing authority.
Transfer of Undertakings — Eligibility versus Qualification
Submission of names of employees as eligible for appointment following a takeover does not mean they are qualified for the positions, but rather that they are qualified to be considered for appointment. Eligibility means qualified or able to be chosen, and employees must still subject themselves to the appointment process.
Volunteers — Payment for Services Rendered
Where employees continue to render services at a facility after its takeover by government but are not formally absorbed into public service, they are entitled to payment for services rendered at the salary rates held under their previous contracts, notwithstanding their status as volunteers.
Employment Act — Section 28 — Scope of Automatic Transfer
The word 'automatically' in Section 28 of the Employment Act does not mean that transfer occurs without any preparation or without considering compatibility of the affected employee's previous terms and conditions with the new terms and conditions under the impending new employment. The incoming employer has a right to inherit employees who are qualified and suitable for the business or undertaking.

Legislation cited (9)

Cases cited (6)

  • Kymukama Godffrey v Makerere Business School (Labour Dispute Reference No. 147 of 2019)
  • Ready Mixed Concrete Vs Minister of Pensions and National Insurance (1968)
  • Mugolo Nehemiah v Vambeco Enterprises (Labour Dispute Reference No. 37 of 2022)
  • Stanley Mugai Muchai vs National Oil corporation of Kenya (Industrial Cause No. 44(N) of 2009;[2002]LLR 250(ICK)
  • Joseph Tindyebwa and Another v Kabale University (Labour Dispute Reference No. 156 of 2018)
  • Elizabeth Washeke and 62 others vs Airtel Networks (K) Limited industrial casus No. 172 of 2012

Full judgment

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

Mwagale_and_8_Others_v_Bugweri_District_Local_Government_(Labour_Dispute_Reference_15_of_2022)_[2023]_UGIC_23_(3_July_2023)
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.