Workplace accidents: Who compensates the employee?

Then police spokesperson Judith Nabakooba visits Kassimu Ssuuna at his home late 2013. PHOTO by Rachel Mabala

What you need to know:

Work hazards. Many victims of workplace accidents in Uganda have always cried foul whenever it comes to their compensation. Who should they be running to?

The traffic along Nsambya Road/eighth Street was thick as always on October 1, 2013. Cars and boda bodas were hooting all way. The morning sun burnt briskly, and the day seemed quite normal for many.

In a split second, the normalcy had been shattered. A former employee of Mukwano industries, Kassim Suuna, had brought a mat and sat or rather started praying at the entrance of the company premises, and according to police, which was called to the scene to intervene, the action was akin to disturbing the peace.

The brutality that police meted on him left everyone baffled - bystanders and those who watched the clip later on Tv news bulletins. The episode subsequently drew ire from politicians, civil society, even the top police authorities as is usually the case.

The big questions were. Who is that guy? What was he doing there?, among others in that line. The company first denied knowledge of him but later admitted that he was a former employee.

The background
Suuna, besides the thunderous kicks and punches that police meted on him, it emerged a year before, while on duty at Mukwano Industries, a machine had cut off the last two fingers of his left hand. The company terminated his services without compensation and he had been seeking the company’s audience but in vain.

Suuna said whenever he tried to reach out to management to complain, they kept dodging him and later started accusing him of criminal trespass. He went an extra mile by taking the case to Jinja Road police but his file was reportedly mishandled, which impelled him to pitch camp at the company’s premises demanding compensation.

Suuna demanded Shs400 million in workman’s claims—enough to buy him land, a house and or even start a business. That was not going to happen, or at least, it never happened. For his injuries—the fingers he lost, the company said, he had been compensated Shs1.1 million. But he wanted more.

In the ensuing hubbub with everyone pointing fingers at the company, it was reported later that he had been offered another Sh25 million to stay out of the media in trying to avoid bad publicity.

That was the last we heard of him. Attempts by this newspaper to trace him for almost a month also proved futile.

There are laws that compel employers to cover employees once injured or killed in the line of duty. But just how effective are the laws and who is pushing the processes, is another story on its own.

On May 1, every year, Uganda joins the rest of the world to commemorate the International Labour Day. But the topic of workman compensation is rarely discussed.

With a work force of 15.8 million, according to National Labour Force and Child Activities Survey 2011/2012, one cannot help to wonder how the Ministry of Gender and Labour follows up employee’s compensation.

About 84 per cent of the work force stays in rural areas; 16 per cent have no formal education and 72 per cent of children aged 6-17 years are actively engaged in work.

Kamanda Bataringaya, the Minister of Gender, Labour and Social Development, which is responsible for enforcing workman compensation, says the law is very clear on what the obligations of employers are and where they fail, penalties too are listed.

“Yes, there have been incidences where employers try to play around but I think majority are compliant,” he says.
But nasty accidents can prove how employers try to skirt around their obligation.

Last month’s fire at the Nitnda-based Crest Foam Mattress factory killed six people and left scores injured. Management first denied there was anyone trapped inside the raging fire, despite relentless insistences from survivors.

It took police two days to retrieve the charred bodies from the ruins of the 29-year-old factory. They had been burnt beyond recognition, necessitating government to conduct DNA tests to ascertain their identities before they could be handed over to relatives for burial.

As relatives waited for DNA results, management assured them and the public that the deceased employees would be compensated since they died in the line of duty.

The national insurance regulator, Insurance Regulatory Authority (IRA), reechoed that compensation is necessitated by law and that Crest Foam’s affected workers would be compensated. In this regard, compensation would amount to six months’ salary.

Bataringaya also stopped the factory from reopening until investigations surrounding the cause of fire are completed and a full report tabled before Parliament.

A month later, much as the legal framework to compel employers to compensate injured or deceased employees exists, Catherine Aneno, the secretary general of Uganda Textile and Allied Workers’ Union, which handles such category of employees, expressed skepticism over the company’s willingness to compensate the dead employees adequately.

According to Aneno, in 2009, when the union approached Crest Foam to sign a recognition agreement, the management accepted to sign the agreement initially for two years but in 2011, they refused to renew the agreement, saying most of its employees are casual labourers who are not entitled to insurance and Pay As You Earn (PAYE).

She says since 2011, most factories employing more than 100 workers resorted to employing casual workforce because the 2011 employment regulations require all employers to promote a worker who has spent four months in the workplace into permanent staff or have some kind of contract.

“These people prefer employing casual workers because the law gives them a threshold of Shs210,000 to start remitting PAYE to government so by paying weekly, they can deny having employees who have stayed with them for more than four months,” she said.

Ms Aneno blames the workers’ woes on their representatives in Parliament because despite having trade unions, MPs do not have a forum where they can meet the workers and listen to their plight

This fact, the national chairperson of the National Organisation of Trade Unions (Notu), Usher Were, agrees to. He told Saturday Monitor that cases are easy to follow up when they are part of a trade union

Ms Aneno says there are more than 40 unions which are affiliated to Notu and the Central Organisation of Free Trade Unions, which government recognises but unfortunately, the trade unions are not well led to articulate the issues affecting the workers.

“Unions are more powerful than associations and they are established under Articles 29 and 40 of the 1995 Constitution. When we speak, our voices are heard as representatives of workers as opposed to associations,” she says.

She says if the unions were active, they should have by now managed to ensure that the workers representatives push for the minimum wage, as well as the installation of the labour advisory board and minimum wage council to advise government on issues affecting the welfare of workers.

Insurance companies

Relatives of victims of the Crest Foam fire camp out side the company premises as they wait for news about their love ones last month. PHOTO Racheal Ajwang


But away from trade unions, the obligations lies with the respective employers. Many employers nowadays, for fear of incurring such unexpected costs, bank the workman compensation obligation with insurance companies.

All employees are signed to an insurance company for sickness, accidents, name it. However, computation of claims by the insurance companies, being a business, also remains a subject of debate.

The spokesperson of IRA, Mariam Nalunkuma, says insurance companies usually fulfill their part of paying on behalf of their client but latest figures are hard to establish.

“When insurance companies report back to us, they indicate they paid this and that much to workers and we compile it as a whole. So it is hard to tell who paid the biggest amount and to who,” she adds.

But according to IRA, the 2013 annual market report, Shs4 billion was paid out by insurance companies as workman’s compensation.
She further noted there is a misconception that the responsibility of enforcing the workman’s compensation lies with them yet in fact, it is the work of the Gender ministry.

Joseph [not real names] worked with one of the telecom companies until he got a car accident one day in 2012.

The accident left him disfigured. The insurance company compensated him but how the package was calculated to total Shs6 million continues to baffle him.

Who is to blame?
“There is no good will at all in this insurance thing. The company insures you for they are preparing for the just-in-cases. The insurance company itself wants to keep the money because that is how they survive,” he states.
But Bataringaya says if an employee does not bring to attention their case with the ministry, it is hard to follow-up.

“But what I know is the law is clear so I don’t think any employer would be that foolish to ignore it.” For Crest Foam workers, he said, the matter is under investigations but the company exhibited commitment first by footing the bills for burial of the deceased, an indication they will cover the rest.

Notu says there are many cases of employers flouting on workman compensation but they blame Workers’ MPs who consult a very small constituency, which often is managed by them. This is worsened by the fact there are no annual statistics depicting the state of workman compensation and its enforcement.

What the law says

Parliament in 2000 enacted the Workman’s Compensation Act, which sets the standards for employee compensation in case of death or injury (diseases, ailments, fractures) name it. The Act also deals with notice of accident and insurance. The exception is personnel of the armed forces. The employer is immediately required to report to the labour officer of the area the accident causing injury or death of an employee.

According to the act, compensation may not be payable unless notice of the accident has been given to the employer by or on behalf of the worker as soon as is reasonably practicable, and in any case within one month after the date when the accident occurred or within three months after the date the symptoms of the occupational disease became apparent; but no notice is required where it is shown that the employer was aware of the accident or disease at or about the time it occurred or at the time when the symptoms became evident, or for any reasonable cause.

To calculate the claims, the monthly earnings of a worker, the law states are computed in a manner best calculated to give the rate per month at which the worker has been remunerated during the twelve months immediately preceding the accident and the computation of annual earnings shall be a multiple of twelve of that sum.

If an employee for example loses two limbs, according to the law, that is equivalent to 100 per cent of a current point. Each currency point is Shs20,000, meaning the victim will receive Shs2m on the basis of the law. This then is reconciled with the insurance coverage by the employer.

However, in terms of insurance coverage by employers, the terms vary from one insurance company to another and employers negotiate differently with the insurance companies. Companies usually do not tell employees how much their insurance premium is worth, and that is where problems arise.

According to Godfrey Himbaza a labour lawyer with OSH Advocates, the insurance company will not pay the whole amount because they have a ceiling they can pay and the balance is paid by the employer.

Other labour laws
Employment Act of 2006: Seeks to revise and consolidate the laws governing individual employment relationship, and to provide for other connected matters.

Occupational Safety & Health Act 2006: It necessitates employers to provide compensation for any injuries sustained, diseases contracted or death suffered from work.

Labour Unions Act of 2006: Gives employees rights to organise themselves into labour unions and participate in management of the said unions.

Labour Disputes Act 2006: Provides avenues for resolving disputes involving workers.