[2021] UGIC 61

# **THE REPUBLIC OF UGANDA IN THE INDUSTRIAL COURT OF UGANDA AT KAMPALA LABOUR DISPUTE REFERENCE NO. 058 OF 2015 [ARISING FROM LABOUR COMPLAINT NO. M'KSE/2/27/3/2013]**

### **1. SYAMUTSANGIRA B. PATRICK**

- **2. MUSHABE PADDY** - **3. BARIGYE LEOPOLD…………….….…..………………………………………………….. APPLICANT**

### **VERSUS**

**TIBET HIMA MINING CO. LIMITED…………………………….………..……………RESPONDENT**

### **BEFORE**

- 1. Hon. Chief Judge Ruhinda Asaph Ntengye - 2. Hon. Lady Justice Linda Tumusiime Mugisha

### **PANELISTS**

- 1. Ms. Adrine Namara - 2. Mr. Micheal Matovu - 3. Ms. Susan Nabirye

#### **AWARD**

This is a labour dispute filed in this court via a memorandum of claim dated 29/4/2015 and filed on 30/5/2015. It arises from a labour complaint MK'SE/2/27/3/15 which was referred to this court by the labour officer of Kasese on 22/4/2015.

The brief facts are that the claimants were employed under probationary contracts dated and signed on various dates. The contracts were appointment letters dated 28th May 2014 and effected by contracts dated and effective on 1/6/2014.

By letter dated 05/01/2015, the probationary engagements with the claimants were extended for a period of 3 months by the respondent with the acceptance (and willingness) of the claimants. On 2/3/2015 all the claimants were terminated with immediate effect.

#### **Issues**

By a joint scheduling memorandum signed by both counsel, the following issues were agreed:

- (a) Whether there was breach of contract by the respondent in the process of terminating the claimants. - (b) Whether the claimants are entitled to the remedies sought.

### **REPRESENTATION**

On the record the claimants were represented by Mr. Samuel Kiryaghe of MRK Advocates while the respondent was represented by Ms. Kiiza Lilian of Ms. Kiiza & Kwanza Advocates.

### **EVIDENCE ADDUCED**

Although both parties filed triable bundles containing documentary evidence, unlike the claimants, the respondent did not turn up to adduce this evidence in open court. The record reveals that from 10/3/2016 the parties engaged in settlement outside court and this court was always granting them adjournments for the same purpose until 8/2/2017 when Mr. Kiryaghe informed court that settlement had failed and this court asked the parties to file the necessary documents/evidence. The case suffered numerous adjournments for failure of both parties to complete pretrial processes until 21/06/2017 when a Mr. Turinawe suddenly appeared and informed court that he received instructions the previous evening and needed time to study the case and get the file from the previous advocates. This was after both parties had filed all necessary documents including written witness statements. The matter was once again adjourned to 25/07/2017 to enable the new advocates put their house in order. Unfortunately, on 25/7/2017 once again the case suffered further numerous adjournments until 5/05/2020 when this court ordered substituted service by way of advertisement in either New Vision or daily monitor.

On 22/03/2021 the court being satisfied that the respondents had been served via the daily monitor newspaper proceeded to hear the matter exparte.

The three claimants after being sworn identified their written witness statements which were then taken as evidence in proof of their case.

We take cognizance of the legal principle that the burden of proving a case in Civil matters (or labour disputes) is always on the balance of probabilities and that the non-attendance of the respondent or defendant at the trial does not by itself discharge the burden on the claimant/defendant to prove the case on the required standard. Failure by the respondent to adduce evidence in rebuttal of the claimant's case does not by itself deliver judgement to the claimant/ plaintiff.

We have carefully studied the evidence of the claimants contained in their written witness statements and in their written contracts of service. It is clear that they were engaged by the respondent on probationary contracts which after six months were extended with the consent of the claimants for 3 months, but two months into the extended contracts, they were terminated.

The initial probation contracts provided (inter alia) under paragraph 3 that:

- (a) For the first six (6) months after the date of commencement you shall be on probation. - (b) During this probation, your employment with the company may be terminated by either party upon service of one (1) months' notice.

The extended probationary engagements provided "**after the extended period above and after assessment of your performance during this period, the company shall advise whether or not to confirm your engagement."**

The law relating to probationary contracts is clearly spelt out in **Sections 27** and **67** of the **Employment Act. Section 27** provides

**"Section 27** variation or exclusion of provisions of the **Act**

- **1. …** - **2. Nothing in this Section shall prevent the application by agreement between the parties of terms and conditions which are more favorable to the employee than those contained in the Act.**

Section 67 provides:

**"Section 67: Probationary contracts**

- **(1) Section 66 does not apply where a dismissal brings to an end a probationary contract.** - **(2) The maximum length of a probationary period is six months but may be extended for further period of not more than six months with the agreement of the employee.** - **(3) An employer shall not employ an employee under probationary contract on more than one occasion.** - **(4) A contract for a probationary period may be terminated by either party by giving not less than fourteen days' notice of termination or by payment, by the employer to the employee of seven days' wages in lieu of notice."**

It was the submission of counsel for the claimants that the termination of the contracts having been contrary to the terms of the contracts requiring one month's notice prior to termination, was unlawful. He submitted that **Section 66(1)(2) of the employment Act** required that an employee be notified and given reasons and a hearing before being terminated.

Under **Section 67 of the Employment Act** above mentioned, a probationary contract can lawfully be brought to an end without recourse to procedures of a hearing specified under **Section 66 of the same Act** as long as the employee is given notice of not less than 14 days. However both employer and employee may agree to an extension of the probation for not more than 6 months. This means that the submission of counsel for the respondent that the claimants were entitled to a hearing under **Section 66** has no merit.

However, under **Section 67 of the Employment Act,** an employer is prohibited from employing an employee on probation for more than one occasion.

In our considered opinion, this means that once an employee has failed the probationary period and an employer has lawfully parted with him/her the employer is prohibited from employing the same employee in the same job description once again on probation. If such employee is re engaged the expectation is that he passed the probation.

It also means that once both employer and employee agree to an extension of the probationary contract, at the expiration of the extended period the employer is expected to either confirm the employee on the job or give reasons related to the employee's performance as to why he/she cannot be confirmed on the job. We firmly take the position that by extending the probation period the employer reasonably believes and trusts that the employee will pass the test of the employer's expectations. Consequently, before extension of the probationary contract an employer is not bound by both **Sections 66 and 68 of the Employment Act** as long as the employee is given not less than 14 days' notice. However, at the expiry of the extended probationary contract, the employee is entitled to reasons under **Section 68** for failure to confirm him/her on the job. This may not be akin to a hearing provided for under **Section 66 of the Employment Act –** which is a preserve of employees who have passed probation.

Although under **Section 67 of the Employment Act** an employee on probationary contract is entitled to not less than 14 days' notice, the probationary contract on the claimants provided under paragraph 3 that termination would be on notice of 1 month.

**Section 27 of the Employment Act** provides that nothing in the section prevents application of an agreement between the parties which is more favorable to the employee than as contained in the Act. In other words, the provision in the contracts of the claimants for a one month's notice is enforceable despite the provision of **Section 67** that a probationary employee is entitled to 14 days. Even then this section provides for a minimum of 14 days giving an employer the option of granting more days to the employee. It was therefore improper for the respondent to have terminated the claimants **"with immediate effect"** given the obvious and clear provision in the contract for notice of 1 month.

A perusal of the claimant's trial bundle at pages 69-70 and 78-79 reveals performance assessments of the 1st and 2nd claimants.

Both assessments contain a recommendation for confirmation although the first claimant's assessment shows that the post did not exist on the structure and that he could be reassigned and confirmed as welfare officer. Those were assessments done after the initial 6 months which indicated that the claimants were ripe for confirmation but instead their probationary contracts were extended. Although this seemed improper, we shall not derive into it since the claimants signed the extension of the probationary contracts. We must mention however that this smacks of a premeditated intention on the part of the respondent to terminate the claimants. It seems to us that the extension of the contract was a matter of buying time to be able to effect the termination.

Accordingly, for failure of the respondent to confirm the claimants as recommended by their superiors but instead extending their probationary

contracts, for failure of the respondent to give notice of termination as provided for by the contracts, and for failure of the respondent to give reasons for termination of the extended contracts, it is our finding and decision that termination was unlawful and a breach of contract. The first issue is in the affirmative.

The second issue is whether the claimants were entitled to remedies sought.

### **(a) Special damages**

It is trite that special damages cannot be granted unless they were initially pleaded and unless they are specifically proved by adducing evidence in respect thereto.

Under **paragraph 5 of the memorandum of Claim**, the claimants pleaded salary areas arising from overtime service to the tune of 924,962.9/=; 1 month's salary in lieu of notice to the tune of 1,541,605/=; Annual leave days to the tune of 809,342.6/= and salary arrears for two unpaid days to the tune of 102,773.7/=. Under paragraph 14 of each of the written witness statements of the claimant, they state that between 10th January 2015 to 3rd March 2015 they worked several hours beyond working days including Saturdays;

Nothing beyond these statements suggests on which exact dates the claimants worked beyond the official hours. We are of the strong opinion that the mere statements were not sufficient to discharge the burden of proof of special damages. The claim of overtime is therefore denied.

As for the 1 month's salary in lieu of notice, the claimant's contracts provided for the same and therefore this claim succeeds.

Although leave is an entitlement to employees, on termination an employee can only claim payment in lieu of leave if he/she proves that he/she applied for leave and that such leave was not granted for one reason or another or for no reason at all.

Under paragraph 15 of each of the claimants written witness statements they testified that over the period of their employment, they accumulated leave days' worth the amounts specified in their statements. However apart from the fact that their contracts contained provisions relating to annual leave, nothing on the evidence suggested that any of them applied and was denied leave. Accordingly this claim is denied.

The last claim on special damages relates to 2 days before termination. Under paragraph's 10 of the claimants witness statements they testified that they received the termination letters which were dated 2/3/2015 on 3/03/2015. This implies that they had worked on 1st and 2nd March. We have no doubt that they are entitled to wages for the two days they worked. Accordingly, this prayer succeeds.

# **(b)General Damages**

Having declared that the claimants were unlawfully terminated by the respondent's breach of their contracts, it is our opinion that this court has a discretion to grant them general damages. They prayed for 60,000,000/= as general damages for each of the claimants.

In determining the amount, the court considers many factors including the nature of the job, the manner of termination, how much the claimant was earning, to what extent the claimant was able to mitigate the loss of his or her job, the period the claimant worked for the respondent as well as the period he/she was yet to work.

Given the nature of the jobs especially the fact that they were of a probationary engagement and given the earnings of the claimants and other factors mentioned above, we hereby grant each of the claimants 750,000/= as general damages.

### **(c) Interest:**

Because of the inflationary nature of our currency and the possibility that the respondent may delay paying the decretal sum, all the sum above decreed shall carry an interest of 15% per annum from the date of this Award until payment in full.

# **(d)Costs:**

No order as to costs is given. Each party shall bear own costs.

In conclusion an Award is hereby entered in favor of the claimants against the respondent in the following terms:

- (1) The claimants were unlawfully and in breach of the contracts terminated from employment. - (2) The claimants shall be entitled to general damages of 750,000/= each. - (3) Claimants shall each be entitled to one month's pay in lieu of notice. - (4) The first, 2nd and 3rd claimants shall be paid 28,610/=, 27,792/= and 43,372 respectively for the two days worked. - (5) The above sums shall attract interest of 15% per annum from the time of the Award until payment in full. - (6) Each party to bear their costs.

# **Delivered & signed by:**

| 1. | Hon. Chief Judge Ruhinda Asaph Ntengye | | ………………………. | |----------------------|-------------------------------------------|------------|------------| | 2. | Hon. Lady Justice Linda Tumusiime Mugisha | | ………………………. | | PANELISTS | | | | | 1. | Ms. Adrine Namara | ………………………. | | | 2. | Mr. Micheal Matovu | ………………………. | | | 3. | Ms. Susan Nabirye | ………………………. | | | Dated:<br>09/07/2021 | | | |