The Court of Appeal has ruled that when one’s employment contract is terminated without reason, there is no need for a hearing.

The ruling was made by three justices, Justice Christopher Gashirabake, Richard Butera, and Catherine Bamugemereire, who agreed amongst themselves.

The Court gave employers the power to terminate the contracts of their employees at any time, with or without any justifiable reason.

This follows a case between Nassanga Saphinah Kasule and Stanbic Bank, where Nassanga was employed by the bank in 2001 and her contract was terminated in 2012 without stating any reason.

The court held that unless it was explicitly stated in the employment contract, the employer can terminate a contract for as long as it gives notice or pays the salary of three months in lieu of the notice.

“It has been held that an employer can terminate the employee’s employment contract for a reason or no reason at all, it is therefore very clear that the employer is not required to give reasons for termination of the employment contract under Section 65(1)(a). Unless the employment contract states it,” Gashirabake ruled.

Otherwise, the employer does not need to have a good reason or any reason to terminate the employment contract. It suffices that the employer has given sufficient notice as provided for under Section 58 of the Employment Act, the employment contract, and any other documents governing the said contract. Where notice is not given, payment in lieu is required as provided by the law and contract,” Gashirabake read.

The law states that an employee is entitled to terminate an employment contract with or without notice if subjected to unreasonable conduct by the employer.

Employment and labor laws in Uganda can be classified into three types of employment contracts, which are as follows; express term contracts, fixed-term employment, and indefinite period contracts.