Wakilii

Ndyabahika Geofrey and Others v Registered Trustees of Church of Uganda (LABOUR DISPUTE REFERENCE NO. 198 OF 2021)

Industrial Court · [2026] UGIC 64 · 2026 Application Partly Allowed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Labour dispute reference from Labour Officer to Industrial Court following complaint of unlawful and unfair termination
Decision
Five claimants with running contracts at the time of outsourcing awarded additional redundancy compensation and payment for untaken leave; claims for overtime, send-off packages, severance, and general damages dismissed

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Holding

The Industrial Court held that the termination of five claimants by redundancy following outsourcing of security and cleaning services was lawful. However, the employer breached its Human Resource Manual by failing to pay three months' salary in lieu of notice as required for redundancy terminations. The court ordered payment of the shortfall in redundancy compensation, one month's salary for untaken leave, and gratuity to all claimants. Claims for overtime pay, send-off packages, severance allowance, and general damages were denied. The court clarified that outsourcing renders in-house employees redundant and that Human Resource Manual provisions more favourable than statutory minimums form part of the employment contract.

Outcome

Five claimants with running contracts at the time of outsourcing awarded additional redundancy compensation and payment for untaken leave; claims for overtime, send-off packages, severance, and general damages dismissed

Facts

Eleven claimants employed in security and cleaning departments of All Saints Cathedral were terminated on 31 December 2020 following the employer's decision to outsource these services during the COVID-19 pandemic. The claimants alleged unfair termination and non-payment of terminal benefits including overtime, redundancy pay, leave pay, gratuity, and severance allowance. The employer contended that some contracts had expired and were not renewed, while others were lawfully terminated with notice, and that all terminal benefits were paid. Evidence showed that by the time of outsourcing, only five claimants had running contracts; the remainder had expired contracts. The employer paid one month's salary in lieu of notice based on the Employment Act but did not pay the three months' salary prescribed in its Human Resource Manual for redundancy terminations.

Issues

  1. Whether some of the Claimants were unfairly and unlawfully terminated by the Respondent?
  2. Whether the Claimants were entitled to send off package as stipulated in the Human Resource Manual?
  3. Whether the Claimants are entitled to compensation for the overtime worked?
  4. Whether the Claimants are entitled to redundancy pay as stipulated in the Respondent's Human Resource Manual?
  5. Whether the claimants are entitled to annual leave pay?
  6. Whether the claimants are entitled to compensation for the unpaid gratuity?
  7. What remedies are available to the parties?

Orders

  • It is declared that the Claimants were lawfully terminated.
  • The Respondent is ordered to pay Ndyabahika Goefrey and Florence Nabuzaale an additional 2 months' salary each as compensation for redundancy.
  • The Respondent is ordered to pay Faustin Oriongan, Issau Adeyngachwiny, and Ekadu Nathan 3 months' salary in lieu of notice each as compensation for redundancy.
  • The Respondent is ordered to pay Ndyabahika Goefrey, Florence Nabuzaale, Faustin Oriongan, Issau Adeyngachwiny, and Ekadu Nathan 1 month's salary in lieu of untaken leave each.
  • The claim for overtime pay is denied.
  • The claim for repatriation is only granted to Issau Adeyngachwiny.
  • The claim for severance pay and general damages is denied.
  • The claim for the send-off package is denied.
  • No order as to costs is made.

Rules and key headnotes

Redundancy — Outsourcing — Effect on In-House Employees
Where an employer outsources services previously performed by in-house employees, those employees are rendered redundant because the employer ceases to exercise managerial prerogative over them and they do not become employees of the supplying organization.
Redundancy — Compensation — Human Resource Manual Provisions
Where an employer's Human Resource Manual provides for three months' salary in lieu of notice for redundancy terminations, this provision is more favourable than the Employment Act's notice requirements and forms part of the employment contract under Section 26(2) of the Employment Act, binding the employer to pay accordingly.
Fixed-Term Contracts — Expiry — No Obligation to Renew
Where a fixed-term contract of service expires by effluxion of time, the employer is under no obligation to renew it or to give reasons for non-renewal, and the termination is lawful.
Annual Leave — Burden of Proof — Employer's Duty to Facilitate
The statutory right to annual leave under Section 53(1)(a) of the Employment Act does not automatically lapse because an employee fails to take leave. The employer, who controls human resource functions and maintains leave records, must demonstrate that it facilitated, encouraged, and made arrangements for employees to take leave.
Annual Leave — Accumulation — Limitation Period
Where a Human Resource Manual permits accumulation of annual leave for a maximum of two years subject to mutual agreement, claims for untaken leave beyond this period and without evidence of mutual agreement are time-barred under the Limitation Act. However, employees terminated by redundancy are entitled to payment in lieu of untaken leave for the year of termination under Section 53(5) of the Employment Act.
Overtime — Burden of Proof — Particularisation Required
An employee claiming overtime pay must particularise the dates and excess hours worked as the basis for computation. In the absence of such evidence, the claim cannot succeed even where the employer possesses managerial authority over workplace arrangements and record-keeping.
Redundancy — Procedural Fairness — Employer's Managerial Prerogative
An employer's managerial prerogative to determine business structure and outsource services cannot be fettered by courts unless the employer fails to comply with substantive and procedural fairness. In exercising this discretion, the employer must maintain mutual trust and confidence with employees, given that redundancy is involuntary and occurs through no fault of the employee.

Legislation cited (13)

Cases cited (19)

  • Florence Mufumba v Uganda Development Bank (Labour Dispute Case No. 138 of 2014)
  • Moses Obonyo v MTN (U) Ltd (Labour Dispute Reference No. 045 of 2015)
  • Dima Dominic Poro v Inyani and Another (Court of Appeal No. 17 of 2016)
  • Idah Iterura v Joyce Mugota (Supreme Court Civil Appeal No. 5 of 2006)
  • Elizabeth Nabatanzi Lugudde Katwe v Attorney General (Court of Appeal Civil Appeal No. 53 of 2013)
  • Annet Nsiimire v UMEME Ltd (Labour Dispute Reference No. 184 of 2024)
  • Elizabeth Kiwalabye v Mutesa 1 Royal University [2020] UGIC 34
  • Kayiwa Muhamed Kigongo and 13 Others v Makerere University (Labour Dispute Reference No. 121 of 2015)
  • Hot Loaf Bakery Ltd v Ndungutse Xavier and 28 Others (Civil Appeal No. 154 of 2015)
  • Ssemugenyi Steven v Benle Consult Ltd (Labour Dispute Reference No. 55 of 2023)
  • Fancy Jeruto Cherop & Nancy Jepkemoi Kiyai v Hotel Cathay Limited
  • Peter Njeya Chembe v Paddy Kenya Limited
  • Smith v Pimlico Plumbers Ltd
  • Mushabe v Real People Financial Services
  • Gyaviira Mutayomba v Four Ways Group of Companies
  • Etuket v Kampala Pharmaceutical Industries (1996) Ltd (Labour Dispute Case No. 272 of 2014)
  • Dr. Peter Wasswa Kityaba v African Field Epidemiology Network (AFENET) (Labour Dispute Reference No. 84 of 2016)
  • Dr. Kiwalabye v Muteesa 1 Royal University (Labour Dispute Case No. 5 of 2017) [2020] UGIC 34
  • Stanbic Bank v Kiyemba Mutale (Supreme Court Civil Appeal No. 2 of 2010)

Full judgment

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Ndyabahika Geofrey and Others v Registered Trustees of Church of Uganda (LABOUR DISPUTE REFERENCE NO. 198 OF 2021) [2026] UGIC 64 (25 June 2026)
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.