Wakilii

Namayanja and Others v Cavendish University Uganda (LABOUR DISPUTE REFERENCE No.097 OF 2019)

Industrial Court · [2025] UGIC 34 · 2025 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Labour dispute reference arising from alleged unlawful termination on grounds of restructuring
Decision
Claimants' employment declared unlawfully and unfairly terminated; awarded severance pay and general damages with interest.

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Industrial Court held that although the Respondent conducted a legitimate restructuring exercise following an NCHE report, the termination of the four claimants five months after the restructuring concluded was procedurally and substantively unfair. The Respondent failed to notify the claimants at least four weeks before termination, failed to consult them, and terminated them outside the three-month statutory window. The claimants were awarded severance pay and general damages but not aggravated or punitive damages.

Outcome

Claimants' employment declared unlawfully and unfairly terminated; awarded severance pay and general damages with interest.

Facts

The four claimants were employed by Cavendish University Uganda in various administrative and accounting roles. In November 2016, they signed two-year renewable contracts. Following an NCHE report in December 2015 identifying weaknesses in the university's operations, the Respondent conducted a restructuring exercise that concluded by January 2017. In August 2016, the Vice Chancellor assured staff their jobs were secure and they were retained as core staff. However, on 16 June 2017, five months after the restructuring concluded, the claimants were summarily terminated on grounds of restructuring. They were notified of the termination on the same day it took effect. The claimants alleged they were not consulted, not given advance notice, and that their positions still existed under different titles.

Issues

  1. Whether the restructuring process in question was conducted in accordance with the law?
  2. Whether the Claimants' employment contracts with the Respondent were respectively unlawfully terminated?
  3. What remedies are available to the parties?

Orders

  • It is declared that the Respondent unlawfully and unfairly terminated the Claimants from employment.
  • The Respondent shall pay the 1st Claimant severance pay of UGX 3,500,000.
  • The Respondent shall pay the 2nd Claimant severance pay of UGX 14,700,000.
  • The Respondent shall pay the 3rd Claimant severance pay of UGX 21,000,000.
  • The Respondent shall pay the 4th Claimant severance pay of UGX 4,400,000.
  • The Respondent shall pay the 1st Claimant general damages of UGX 3,500,000.
  • The Respondent shall pay the 2nd Claimant general damages of UGX 11,500,000.
  • The Respondent shall pay the 3rd Claimant general damages of UGX 8,000,000.
  • The Respondent shall pay the 4th Claimant general damages of UGX 5,000,000.
  • Interest of 6% per annum shall accrue on the awards for severance pay and general damages from the date of filing until payment in full.
  • No order as to costs.

Rules and key headnotes

Redundancy and Restructuring — Statutory Notice Requirements
Where an employer contemplates termination of not less than ten employees over a period of not more than three months for reasons of an economic, technological, structural or similar nature, the employer must provide relevant information to affected employees or their representatives at least four weeks before the first terminations take effect, except where the employer can show it was not reasonably practicable to comply with such time limit.
Redundancy and Restructuring — Consultation Requirement
Termination on account of redundancy involves mandatory consultation with the affected employees. A consultative process promotes fair labour practices and the fairness of the decision to terminate a given employee calls for transparency in declaring a given position redundant. It must be shown that the process was fair, transparent, objective, and involved the employee.
Redundancy and Restructuring — Three-Month Statutory Window
Termination by redundancy must occur over a period of not more than three months from the commencement of the restructuring process. Where an employer renews employment contracts during a restructuring exercise and then terminates employees five months after the restructuring concludes, the termination cannot be attributed to the restructuring and is unlawful.
Redundancy and Restructuring — Notification on Day of Termination
Where an employer notifies employees that their positions are affected by restructuring and terminates them on the same day, without prior consultation or advance notice, the termination is procedurally unfair and unlawful, regardless of whether the employer had a legitimate business reason for restructuring.
Remedies — Severance Pay Calculation
Where there is no agreed formula for calculating severance pay, an employee who has been unlawfully terminated and who has served for six months or more is entitled to one month's salary for every year served.
Remedies — Future Earnings and Specific Performance
Where an employer dismisses an employee even in fundamental breach, the dismissal brings the contract to an end without the need for acceptance by the employee. A claim for the remaining part of the contract or for future earnings cannot stand, and the court cannot order specific performance of an employment contract. An employee can only claim damages for unlawful termination and not for future earnings.
Remedies — General Damages for Unlawful Termination
General damages are awarded to compensate an employee for non-economic harm and distress caused by wrongful dismissal, including mental anguish, damage to reputation, emotional distress, and any other non-monetary harm. In computing quantum, the court should consider the length of service and the employability of the claimant. General damages can be awarded in addition to other remedies such as severance pay.

Legislation cited (13)

Cases cited (31)

  • Bank of Uganda v Kibuuka and 4 Others (Civil Appeal No. 281 of 2016)
  • Nankabirwa v Board of Governors St Kizito Technical Institute (Labour Dispute Claim No. 60 of 2016)
  • Vice-Chancellor of Massey University v. Wrigley & Anor, [2011] NZEmpC 37 WRC 2/10
  • South African Commercial Catering and Allied Workers Union & Ors v. JDG Trading (Proprietary) Ltd, JA 140/17
  • Williams v Compare Maxam Ltd [1982] ICR 156
  • Chemical Workers Industrial Union & Ors v Latex Products (Pty) Ltd, J A 31 of 2002
  • Simpsons Farms Ltd v Aber hart (2006) 7 NZELC 98,450 (EC)
  • Rolls Royce pic v Unite the Union [2009] EWCA Civ 387
  • SACCAWU & Ors v Woolworths (Pty) Ltd [2018] ZA CC 44
  • Thomas De La Rue (K) Ltd v David Opondo Omutelema [2013/ eKLR
  • Barclays Bank of Uganda v Mubiru (Supreme Court Civil Appeal No. 1 of 1998)
  • Omoding v Rakai Health Science Program (Labour Dispute Claim No. 39 of 2016)
  • Lwanga v Bank of Uganda (Labour Dispute Claim No. 142 of 2014)
  • Nankanbirwa Magezi v St Kizito Technical Institute (Labour Dispute Claim No. 60 of 2016)
  • [2020] UGIC 34
  • PACE v Nagasha (Labour Dispute Appeal No. 35 of 2018)
  • Kayiwa Muhamed Kigongo and 13 Others (Labour Dispute Reference No. 121 of 2015)
  • Ndaula Abubaker and Another (Labour Dispute Reference No. 161 of 2022)
  • Veronica Mkiwa Mwalwala v Faiza Bhanji t/a villa Kalista Enterprises [202JKRLRC 1821
  • German School Society and Another v Ohany and Another, [2023]KECA 894
  • Murray v Foyle Meats Ltd [1999] ICR 827 HL
  • Kamuli v DFCU Bank (Labour Dispute Claim No. 02 of 2015)
  • Stanbic Bank v Kiyimba Mutaale (Supreme Court Civil Appeal No. 02 of 2010)
  • Musinguzi v Stanbic Bank Uganda (Supreme Court Civil Appeal No. 28 of 2012)
  • Tumwesigyire v Trans Sahara International General Trading (High Court Civil Suit No. 95 of 2005)
  • Uganda Development Bank v Mufumba (Civil Appeal No. 241 of 2015)
  • Uganda Post Limited v Mukadisi [2023]58
  • Stanbic Bank v Okuo Constance (Civil Appeal No. 60 of 2020)
  • Bank of Uganda v Tinkantanyire (Supreme Court Civil Appeal No. 12 of 2007)
  • Gail Galea v. Walmart Canada Corp., 2017 ONSC 245
  • Wallace v. United Grain Growers Ltd., [1997] 3 S.C.JR. 701

Full judgment

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Namayanja_and_Others_v_Cavendish_University_Uganda_(LABOUR_DISPUTE_REFERENCE_No.097_OF_2019)_[2025]_UGIC_34_(29_April_2025)
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