Wakilii

Peter Kiwanuka v Uganda Clays Limited (Labour Dispute Reference No.115 of 2020)

Industrial Court · [2025] UGIC 78 · 2025 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Labour dispute reference arising from alleged unfair dismissal from employment
Decision
Claimant's dismissal declared unfair and unlawful; awarded general damages, statutory compensation, interest, and half costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Industrial Court held that the claimant's dismissal was both procedurally and substantively unfair. The employer failed to provide a fair hearing, issue proper notice of allegations, conduct a formal investigation, or give the employee an opportunity to defend himself before an impartial tribunal. The court found that forced resignation followed by termination without due process constitutes unlawful dismissal. The employer could not establish genuine belief in the misconduct alleged without holding a hearing. The claimant was awarded general damages equivalent to seven months' salary, statutory compensation for failure to hold a disciplinary hearing, and half of his taxed costs.

Outcome

Claimant's dismissal declared unfair and unlawful; awarded general damages, statutory compensation, interest, and half costs

Facts

The claimant was appointed Head of Human Resources and Support Services of the respondent company in December 2012. His contract was extended in 2016 and again in 2019 for four years. On 6 March 2020, the respondent's Board of Directors dismissed him for persistent conflicts and disharmony within top management that allegedly affected company performance. The claimant was offered the option to resign, which he declined. He was then terminated without prior disciplinary proceedings or notification of specific misconduct. The respondent published newspaper notices stating the claimant had left by mutual consent. The claimant received terminal benefits including three months' salary in lieu of notice, one month's ex gratia payment, and payment for untaken leave. The respondent's witness testified that the Board believed the claimant was responsible for intrigue arising from his unsuccessful application for the Managing Director position in 2014, which created conflict with the successful candidate. No formal investigation was conducted and no disciplinary hearing was held before the dismissal.

Issues

  1. Whether the Claimant was unlawfully terminated or dismissed?
  2. What remedies are available to the parties?

Orders

  • It is declared that the Claimant was unfairly and unlawfully dismissed from his employment with the Respondent.
  • The Respondent shall pay the Claimant UGX 114,270,400 as general damages.
  • The Respondent shall pay the Claimant UGX 14,253,430 for failure to hold a disciplinary hearing.
  • The Respondent shall pay one-half of the taxed costs of the claim.
  • The awards of general damages and four weeks' net pay shall attract interest at 12% per annum from the date of this award until payment in full.

Rules and key headnotes

Dismissal — Distinction Between Termination and Dismissal — Misconduct as Basis
Under the Employment Act, termination refers to discharge from employment for justifiable reasons other than misconduct, such as expiry of contract or retirement age, while dismissal means discharge at the employer's initiative for committing verifiable misconduct. Where an employer discharges an employee for alleged persistent conflicts and disharmony attributed to the employee's conduct, this constitutes dismissal for misconduct, not termination, and triggers the procedural requirements for dismissal under Section 65 of the Employment Act.
Dismissal — Procedural Fairness — Right to Fair Hearing — Essential Elements
Procedural fairness in dismissal for misconduct requires: (i) sufficient notice of allegations with particulars; (ii) service of notice on the employee with reasonable time to prepare a defence; and (iii) notice stating the employee's rights to have a representative, call witnesses, present a defence, attend with a person of choice, provide a written response, and appear before an impartial tribunal. Section 65 of the Employment Act is couched in mandatory terms and where the reason for dismissal is misconduct, the employer must hold a hearing.
Dismissal — Investigation — Necessity and Purpose in Disciplinary Proceedings
An investigation report is integral to procedural and substantive fairness in disciplinary proceedings. When there are allegations of employee misconduct, the investigation consists of a formal inquiry to establish the extent of the misconduct and the facts underlying the allegations. It is the gathering of evidence to be put before the employee at the hearing. An employer's belief that it already possesses all relevant information does not excuse the requirement to conduct a formal investigation.
Dismissal — Forced Resignation — Treatment as Dismissal
A forced resignation is treated as a dismissal. Where an employer offers an employee the option to resign and makes it clear that unless the employee resigns he will be dismissed, and the employee declines to resign and is then terminated, this constitutes a forced resignation and amounts to unlawful dismissal. Under Section 65 of the Employment Act, if an employer considers dismissal for misconduct or performance, they must hold a hearing.
Dismissal — Substantive Fairness — Genuine Belief and Burden of Proof
Substantive fairness is achieved when there exists a credible, well-founded, and substantive reason for dismissal, specifically verifiable misconduct as opposed to conjecture or personal discretion by the employer. The employer must establish that the employee was indeed guilty of misconduct. In the absence of a notification, an investigation report, and a hearing at which the allegations could have been put to the employee and proven, it is impossible to say that the employer had a credible, well-founded, and substantive reason for dismissal. By not subjecting the employee to a hearing, the employer loses its opportunity to justify the reasons for dismissal.
Remedies — Terminal Benefits — No Bar to Claim for Unlawful Dismissal
Payment of terminal or severance benefits does not exonerate an employer from liability arising from unfair dismissal. Terminal benefits are contractual or statutory obligations that accrue upon termination, independent of the fairness or lawfulness of the dismissal itself. An employee's acceptance of terminal dues does not constitute acquiescence to unlawful dismissal and does not disentitle the employee from bringing an action for unlawful dismissal. Compensation for unlawful dismissal serves as solatium for the infringement of the right to fair dismissal and cannot be equated with patrimonial loss, nor can it be automatically reduced by severance pay.
Remedies — General Damages — Assessment Principles
General damages are awardable for breach of employment contract and for non-economic harm and distress caused by wrongful dismissal, including compensation for emotional distress, mental anguish, damage to reputation, and any other non-monetary harm suffered. General damages should be assessed based on the prospect of the employee getting alternative employment or employability, how the services were terminated, and the inconvenience and uncertainty of future employment prospects. The rationale is the principle of restitutio in integrum — to put the injured party in the position in which he or she would have been had the contractual obligation been performed, so far as possible by monetary award.

Legislation cited (17)

Cases cited (45)

  • Stanbic Bank v Deogratius Assimwe (Supreme Court Civil Appeal No. 18 of 2018)
  • Florence Mufumba v Uganda Development Bank (Labour Dispute Claim No. 138 of 2014)
  • [2010] UGSC 44
  • Oyet v Uganda Telecom Ltd (High Court Civil Suit No. 161 of 2010)
  • Aena Robert v Uganda Communications Commission (Labour Dispute Claim No. 023 of 2015)
  • [2023] UGCA 100
  • [2012] UGCA 3
  • [2025] UGIC 1
  • [2023] UGIC 75
  • Cornwell Muleya v Uganda Airlines Company Ltd (Labour Dispute Reference No. 97 of 2002)
  • Ebiju James v Umeme Ltd (High Court Civil Suit No. 0133 of 2012)
  • [2023] UGCA 342
  • [2025] UGIC 72
  • Kabagambe v Post Bank Uganda Limited
  • [2002] 3 ILR 121
  • Akewa v Loving one by one Ministries
  • Daniel Devadass A/L T. Ganapathy @ Supramaniam V Tasek Corporation Berhad CASE NO. 10/4-2525/21 Malaysian Industrial Court 23rd February 2023
  • [2023] UGIC 44
  • [2020] UGCA 88
  • Ssempijja vs D-Light Design Limited
  • Rwambale v Garfield Institute of Technology
  • Total SA (Pty) Ltd v Meyer and Others 42 ILJ 1696
  • [2024] UGIC 36
  • [2008] UGSC 21
  • [2014] UGHCCD 52
  • [2019] UGIC 10
  • Ochieng Peter v Parliamentary Commission
  • [2013] KEHC 3275
  • Kyomuhendo Jackline v Daj Communications Ltd (Labour Dispute Claim No. 07 of 2017)
  • Mutono v Kampala International University
  • [2000] UGHC 63
  • Makuza v Civil Aviation Authority & Another
  • Joseph Matovu & 4 Ors v Stanbic Bank Uganda
  • [1955] EACA 315
  • [2015] ZAGPJHC 51
  • [2011] ZACC 4
  • [2012] EWHC 1473
  • [2008] EWCA CIV 130
  • Karanzi v Kampala International University
  • [2023] UGSC 58
  • [2025] UGCA 290
  • Kangave Mustafa v Pride Microfinance Limited (MDI)
  • Cpt Charles Karabarinde and 5 Others v Meridiana Africa Airlines Uganda Limited
  • Kalule v Deustche Gesellschaft Fuer Internationale Zuzammenarbeit (GIZ) GMBH
  • Paul Semogerere v Attorney General (Constitutional Appeal No. 1 of 2000)

Full judgment

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Peter_Kiwanuka_v_Uganda_Clays_Limited_(Labour_Dispute_Reference_No.115_of_2020)_[2025]_UGIC_78_(24_October_2025)
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.