[2011] UGHC 189

## **THE REPUBLIC OF UGANDA HE HIGH COURT OF UGANDA AT KAMPALA CIVIL APPEAL** No. **0023 OF 2009** ^Arhiln?Mr°^m C-S' No- ¹⁷⁶² of ²⁰⁰⁸ of '-nief Magistrates' Court at Mengo)

PASCAL KWEZI ....................... APPELLANT

- VERSUS -

## ATTORNEY GENERAL **BEFORE: HQNJMR^JUSTICE V. T. ZEHURIKIZF JUDGMENT:-** : RESPONDENT

The appeal is against the judgment and order of Grade I Magistrate delivered on 28/4/2009 at Mengo dismissing the plaintiffs/Applicant's case.

The undisputed evidence as found by the trial court is that the Appellant was an employee of the External Security Organization where he worked for 11 years before he was retrenched or retired during the restructuring and re-organization of the Organization,

His terminal benefits were computed according to regulations 32 and 37 of the Terms and Conditions of Service 2000. He was paid the computed sum which amounted to 37,481,752/-,

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*10* The plaintiff was not eat-ir.r atisfied with the above retirement package. He contended that his pmni™, pioyment was for a specific and fixed period and that Ted unlawfully before he served the rest of 9 years. (Paragraph 6 of the plaint).

He claimed that under the Terms and Conditions of Service he would be retired only on completing 20 years of service or on attaining 50 years of /\_f age whichever is earlier, (Paragraph 4 of the plaint).

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In his plaint and also in his evidence in court the plaintiff prayed for declaration that he was entitled to full payment for the entire 20 years less of what he had earned and been paid. T

He also prayed for a declaration that the reported retirement before the *2o* expiry of 20 years was unlawful.

The learned trial magistrate having rejected all the plaintiff's claim he appealed to this court and set forth the following grounds namely that: '

- 1- The learned trial ^gistrate erred in law when she failed to distinguish tract of employment whose term is fixed and one which is terminable on notice. - 2. The learned trial magistrate misconstrued and misapplied the authority of *Bank of Uganda l/s Betty Tinkamanyire CA 12 of 2007 (SC)* and thereby came to a wrong conclusion.

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- 3. The learned trial magistrate erred in law not to have held that the m Appellant's contract of employment was a fixed contract. - 4. The learned trial magistrate erred in law to dismiss the Appellant's case.

At the hearing of the Appeal Mr. B. Tibesigwa Counsel for the Appellant outlined the facts on which his client's case is based. He told court, and correctly so, that the issue at the trial was whether the appellant/plaintiff was entitled to be paid for the remaining nine years, having served for 11 years.

I believe it is in that spirit that he opted to argue all the four grounds together.

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He painted out that ths main ground of this appealis tbat ttis ttlal ®u'¹ failed to distinguish between a contract ©f employment wuqs© term is and on® which is terminable on notice.

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It was his view that under rule 32 o.f s,i, nq, §^q ths Appellant's Contract of Service was fixed and that it was not terminable on notice,

Counsel contended that according to law, once a fixed contract of employment is terminated permanently the employee is entitled .to payment for the balance of the period remaining. He relied on *Bank of Uganda Vs Betty Tinkamanyire CA No. 12 of2007 (SC).* (Supra)

Counsel further contended that in *flwesigwa Aggrey and 0 others Vs Attorney General C. S. No. 88 of 2003 (unreported)* this court held that under Regulation 32 of the said SI No. 80/2000 the contract of service was a fixed contract and that the employee was entitled to payment for the remaining nine years.

^qudss^J cr.itiaizecl thp <- \* ⁱ - \* trial magistrate for qqe following *Y e* (Supra) having found that the facts in this case were similar as in am>

unsel for the appellant invited this court to find that the appellant is entitled to payment for the remaining nine years as was held in the Mwesigwa g§g§,

In reply Ms. Nabakooza the learned Principal State Attorney also Qpted to argue all the grounds together.

Referring to the appellant's appointment letter (exhibit Pl) counsel contended that the appointment was subject to the Security Organizations Statute No. 10 of 1987 and the Administrative Instructions made from time to time,

That the appointment letter does not state anywhere that his appointment is fixed. Counsel further pointed out that according to the retirement letter (exhibit P2) the appellant was retired from ESO due to the ongoing restructuring and re-organization of ESO and that

• • • - ent benefits would be computed according to regulations 32 and 37 of v^ ei-ms and Conditions of Service as perSI §Q of .t was her contention that these two regulations do not in any 8y insinuate that his employment was fixed. That they are specifically for computation of benefits.

The learned Principal State Attorney contended that the decision in **Mwesigwg ease** (supra) is no longer good law in view of the subsequent decision of the Supreme Court in **Bank of Uganda ease** (supra). She stressed that the appellant's claim for the remaining period is simply speculative.

I have considered submissions by both counsel, perused the judgment of the trial court and studied the authorities cited to me. I have also perused the Regulations in issue which are found in SI 80 of 2000.

The relevant parts of Regulation 32 of SI 80 of 2000 states:-

*ⁿ32 (1) An officer shall retire on attaining the age of 50 years or after 20 years of active service, whicheveris sooner.*

*(3) (4) (S)* ? « ^F ?« g « *^g ^k » sk\* gg ^g if gg*

*Upon retirement, an officer shall be provided with transport for self and family to his or her home village, and to an exgratia payment equivalent to 5 per cent of the officer's gross earnings for the period served"*

And Regulation 37 of the said Regulation provides;

- *"37 (1) An officer shall, after every three years of service, be paid a gratuity of30 per cent of his or her gross salary earnings for every completedyear ofservice.* - *(2) For the avoidance of doubt, gratuity accruing before the commencement of these Regulations shall be calculated at 30 per cent of salary earnings for the period served.*

According to the evidence adduced by the Respondent, the above provisions were complied with in computing the appellant's retirement package. The appellants contention is that he should have boon paid the earnings that would have been paid to him if he had served the remaining 9 years of service. The whole issue, in my view, turns on th© meaning of Regulation 3^ (1) reproduced above.

*f.wes/gwp Aggrey Case* (Supra) where the facts were similar to the facts in this case, My brother the Hon, Justice Remmey Kasule (as he then was) held thus:

*The law in case of unlawful termination ofa contract of employment, with no provision for termination prior to expiry of the fixed period is that the employee is entitled to recover as damages the equivalent to remuneration for the balance of the contract period. This is in contrast to unlawful termination of a contract that has a stipulation of termination by eitherparty"*

The above holding flowed from the finding that the plaintiff's contract of employment under Regulation 32 (1) was one for a fixed period and had no provision for termination notice prior to the expiry of the said fixed period. This was a decision by the High Court made on 17/3/2006.

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eme Ceurt in **Bank ©f Uganda (Supra)** their Lordships had this to say

Wtof/g/i *that an employee whose contract- &\$■ P yment is terminated prematurely or illegally be compensatedfor the remainder ofthe years P iod when they would have retired is 3inable in law. Similarly, claims of holidays, leave, lunch allowances and the like which the unlawfully dismissed employee would have enjoyed had the dismissal not occurred are merely speculative and cannot bejustifiedin law".*

I am conscious of the fact that the facts in the above cases were different. In the *Bank ofUganda case the.* plaintiff was suing for wrongful dismissal and her terms and conditions of service, apparently, do not contain the equivalent of Regulation 32 (1) above. But I am still convinced that the above principle of law applies to the instant case.

The above decision by the Supreme Court flowed logically from their statement of law in the same case when their Lordships stated.

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"It is trite that, a court of law should not use its powers to force an employer to retake an employee it no longer wishes to continue to engage".

I find that ordering the employer to pay all that the employee would have 10 earned if the employment had not been terminated is an indirect way of forcing the employer to keep or retain the employee it no longer wishes to continue to engage.

In the instant case the Government for some reasons decided to restructure and re-organize the security organization by laying off personnel including the appellant. In my view ordering it to pay the laid off staff all the money they would have earned if they had served for the whole period of service would defeat the very purpose of the restructuring and re-organization.

Further I do not believe that this is the meaning of Regulation 32 (1) 20 above.

In my view the Regulation simply puts a sealing to the duration an officer can serve in the Security Organization.

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He or sne cannot serve for more than 20 years, and if he attain? the df 50 years he or she must retire even if he/she has not served for 20 yeais,

Section 2(2) of the Security Organizations' Act states that the organization shall be Government Departments.

These organizations are described in subsection one of section 2 as the Internal Security Organization and the External Security Organization.

The officers and other employees are appointed by the President on the advice of the Director General of the organization concerned. This is how the appellant got to be employed in the External Security Organization.

The letter of appointment does not in any way provide that he was appointed for a period of 20 years service or until he attains 50 years of age.

It simply stated that his appointment is subject among other things, to the security organizations statute and the Regulations made there under. The

Emulations provide the mayimura Period one cap serve the organization and the age limit one can mn«. ontmue serving it. These were provisions of what is usually called compulsory retirement in public service. 2 c

Q being a tsovemm^nt ©epar-tment as already stated above Regulation 32 (1) simply provided for the extent to which an officer can offer his or her service in the organization.

The regulation did not provide for a contract of employment for a fixed period. If that was the case it would have been stated so in clear terms as < it is provided under Regulation 17 which states:

*"The Director General may, on the recommendation of the Appointments Committee, employ an officer on contract on a special assignment or task and Director Genera! may recommend to the Security Organization t o Committee any terms as he or she may deem appropriate concerning the contract.*

In my view under such contract a fixed period can be stated.

Another instance where a contract of employment for a fixed period can be entered into is under Regulation 33 which states: $15$

- "(1) An officer may, after his or her retirement, be called upon to render special service to the security organization on contract. - A contract for service under this section shall be $(2)$ for three years, and shall not exceed two terms."

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For the reasons I have tried to give above I find that regulation 32 (1) did not provide for a contract of employment for a fixed period and for that matter the appellant was not employed on such terms.

Counsel for the appellant did not contend that the termination of the appellant's employment was unlawful and I think rightly so because the evidence on record shows that there was a restructuring and reorganization of the organization in which a number of employees were laid They were paid the gross terminal benefits which were computed off. according to regulations 32 and 37 of the Terms and conditions of service. $10$

There is no evidence that the respondent defaulted on the payment.

30 In the premise I find no merit in this appeal which is hereby dismissed. Given the nature of the case and parties $\rm I$ will make no order as to costs.

VINCENT T. ZEHURIKIZE **JUDGE** $31/3/2011$ .