Effective termination of employment relationship

Monday September 14 2020

Casual workers at Lukaya Rice Farm in Kalungu District after attend a meeting on March 28. The company laid off several casual workers due to the Covid-19 impact. PHOTO | FILE

By Guest Writer

In some instances, the termination of an employment relationship is contentious and in fact a leading cause of protracted litigation between employees and employers in Uganda. To prevent unnecessary legal challenges, it is important that both parties end their liaison in strict conformity with the law. 
Employment may be ended by mutual agreement between the employee and employer or unilaterally by either party. An employer can let an employee go by issuing an advance notice of termination or payment in lieu of this notice. 
Only employees who have worked with an employer for more than six months are entitled to this notice that varies with the duration of service. The law does not prescribe a reciprocal notice requirement for employees but employment contracts usually prescribe a notice period. 
This notwithstanding, employers should have plausible reasons for terminating an employee’s contract. Courts in Uganda have ruled that employers do not have a free hand to carry out terminations at will and wantonly even when they can issue an advance notice of termination.
A fixed period employment contract terminates upon the expiration of that period. In this instance, an employer need not to have any reasons for the termination. Some fixed period contracts, however, contain provisions to the effect that they are renewable and the interpretation of this can be contentious. Questions that arise are whether the contract renewal is automatic or is dependent upon the fulfillment of stated or implied conditions if any.   
Employment likewise terminates if any employer is declared bankrupt or winds up in the case of a corporate entity. The law deems an employment contract ended in these circumstances after one month of the declaration of bankruptcy or insolvency.   
Employees unable to discharge their duties by reason of sickness are entitled to full pay for the first month of sickness. An employer can terminate the employment relation at the end of the second month for persisting sickness. However, staff welfare is of paramount importance to some organizations that usually provide for longer periods of sick leave in the contracts issued to their employees.
An employee may terminate an employment relationship with or without notice if he or she is subjected to unreasonable conduct by the employer. The law does not expressly define unreasonable conduct but Courts have drawn guiding parameters. 
In the case of Muyimbwa Paul versus. Ndejje University (Labour Dispute Reference No. 222 of 2015), the Industrial Court ruled that the demotion of an employee without giving them an opportunity to be heard was unreasonable conduct. Similarly, in Nyakabwa Abwooli versus Security 2000 Limited (Labour Claim No. 108 of 2014), the Industrial Court ruled that the removal of instruments of an office without providing an alternative was unreasonable conduct. 
The Industrial Court further explained that employer conduct is unreasonable if it is a serious breach, is illegal and injurious to the employee making it impossible for the employee to continue working.  
The death of an employee also terminates an employment contract but the employer must pay to the deceased employee’s estate any outstanding salaries and benefits at the time of the employee’s death. If the employee died at the workplace or in transit to the workplace, the employer has additional obligations to notify the District Labour Officer of the death and transport the deceased’s body to the burial place. 
An employee may be summarily dismissed by an employer where there is a fundamental breach of the terms of employment.  What amounts to fundamental breach is a question of fact and the circumstances giving rise to summary dismissal proceedings are usually spelt out in the employer’s Human Resources Manual. The hallmark of summary dismissal is that the employment contract is terminated without notice or payment in lieu of notice or less notice than required.  
Prior to summary dismissal, the employer must however hold a disciplinary hearing and establish that the employee is guilty of the conduct complained of. The Industrial Court has explained that the rationale for holding a disciplinary hearing is to give the employee an opportunity to defend himself/herself against the allegations made against them. 
This position has been amplified in several cases that include Levi Malinzi vs. Uganda Printing and Publishing Corporation, Labour Dispute No. 50 of 2015, and Dr. Omona Kizito vs. Marie Stopes Uganda, Labour Dispute Claim No, 33 of 2015. 

Denis Kakembo is the managing partner Cristal Advocates.