Kiggundu Yunus v Felister Uganda Limited (Labour Dispute Reference No. 5 of 2023) [2025] UGIC 40 (4 April 2025)

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# THE REPUBLIC OF UGANDA IN THE INDUSTRIAL COURT OF UGANDA AT LIRA HOLDEN IN GULU LABOUR DISPUTE REFERENCE NO. 5 OF 2023

*(Arising from Apac Labour Dispute Complaint No. <sup>01</sup> of2022)*

# KIGGUNDU YUNUS CLAIMANT

## VERSUS

FEUSTER(U) LTD ::::RESPONDENT

BEFORE: The Hon. Mr. Justice Anthony Wabwire Musana

THE PANELISTS: Hon. Adrine Namara, Hon. Emmanuel Bigirimana & Hon. Can Amos Lapenga.

Representation:

- 1. Mr. Sam Oola of M/S F. Aogon & Co. Advocates for the Claimant. - 2. None for the Respondent.

### *Case summary*

*This text, from an employment dispute case, details the legal proceedings involving Mr. Yunus Kiggundu and his former employer regarding unpaid National Social Security Fund (NSSF) contributions. The document outlines the claimant's employment history, the employer's failure to remit mandatory NSSF payments for nineteen years, and the procedural steps taken through the Labour Officer and eventually the court. The court ultimately ruled in favour of the claimant, declaring his entitlement to the unremitted contributions, awarding general damages for being deprived ofhis social security benefits, and ordering the respondent to pay court costs.*

*Heard: Determined: 4th June 2025 4th June 2025*

### AWARD

# Introduction

[1] This award concerns entitlement to unremitted National Social Security Fund Contributions. The uncontested facts are that Mr. Yunus Kiggundu was employed by the Respondent as a driver in March 1998. He was registered as an employee of the Respondent with the National Social Security Fund and assigned the number NS093300NAK. He resigned in March 2018 and, by letter dated 22nd March 2018, raised the question relating to his NSSF contributions. On the 29th of July 2020, the Fund advised that no contributions had been remitted for the Claimant. After a series of letters exchanged between the parties, on the 20lh of October 2022, the Claimant approached the Labour Officer in Apac for a resolution. When the matter went unresolved, on k the 15th of December 2023, the Labour Officer referred the matter to this Court's Sub-Registry in Lira. I

# *Procedural History*

- **[2]** The matter was first called before us on the 30th of May 2024. We directed that the matter be sent for court-annexed mediation. The Claimant filed his mediation notes. When the matter came before us on the 8th of May 2025, Mr. Sam Oola, appearing for the Claimant, advised that mediation had failed. We directed the filing of all pre-trial documents by 16th May 2025 and set the matter for mention on 23rd May 2025. On that day, the Court did not sit, and the matter was called on 28th May 2025. We set the matter for hearing on 4th June 2025 in Gulu. Counsel for the Claimant was directed to serve the Respondent and furnish the Court with proof of service. - **[3]** When the matter came up for hearing this morning, Mr. Oola sought leave to proceed exparte. We reviewed his affidavit of service dated 2nd June 2025, and we were satisfied that service had been effected on the Respondent. We granted the Claimant leave to proceed exparte under Order 9Rule 20(1)(a) of the Civil Procedure Rules S.l 71-1 - [4] The following issues were framed for determination - **(•)** Whether the Claimant is entitled to UGX 89,335,886.25/= being unremitted NSSF for the 19 years of service and - **(H)** What remedies are available to the parties? - **[5]** The documents in the Claimant's trial bundle and his witness statement made on the 30th of May 2025 were adopted as his evidence in chief. After the Claimant's testimony, Mr. Oola closed the Claimant's case and was directed to make oral submissions.

## *Claimant's submissions*

**[6]** In his oral submissions, Mr. Oola made three principal points: First, he recounted the Claimant's employment history from March 1998 to March 2018 at a salary of UGX 200,000/= per month and <sup>a</sup> daily allowance of UGX 70,000/=, secondly, the Respondent's failure to remit social security contributions as required under Section 10(1) of the NSSF Act Cap. 230 and the claim for 10% penalties for non-remittance under Section 14(1 )(a) of the Act. We were also asked to award damages for pain and suffering, based on *Omunyokol vAG,* and costs as per Section 27 of the Civil Procedure Act. Cap. 282.

#### *Decision ofthe Court*

### *Issue One: Entitlement to unremitted NSSF Contributions*

**[7]** Under Section 48 of the Act, a magistrate of any grade has jurisdiction to hear any cause or matter in all cases arising under the Act regarding a question of liability of an employer to register as a contributing employer or any question of his or her liability to pay contributions to the fund. What is clear from this provision is that the jurisdiction to entertain claims for nonremittance of Social Security Contributions is vested in magistrates' Courts. And because jurisdiction is a matter of law and cannot be implied, the Court must establish if it has jurisdiction.

**A**

- [8] This Court was confronted with a similar guestion in *Avivi v SBI International Holdings AG Uganda<sup>1</sup>* where our reading of that section was that it relates to ensuring compliance by the employer with registration with the fund and payment of the employer's contribution to the fund. We cited *Aijukye v Barclays Bank (U) Ltd<sup>2</sup>* for the proposition that the Industrial Court is entitled to grant relief in the declaratory form, where the employee brings the action as owner of the property in the remittances finding that approach to be consistent with the jurisprudence expressed by the Court of Appeal of Uganda in the case of *Makubuya v Buliamu Muwanga Kibrige t/a Kowloon Garment Industry and Another* <sup>3</sup>where Madrama JA *(as he then was)* held that under Order 2 Rule 9 of the Civil Procedure Rules S.l. 71-1 *(from now CPR),* a party is entitled to a declaratory judgment of right whether conseguential relief is claimed or not. In that case, we opined that the Industrial Court would not delve into compliance and liability for nonpayment but reserve the power to proffer declaratory relief. - [9] In the present case, it is uncontested that the Claimant was an employee of the Respondent. It is also uncontestable that he was registered as an employee of the Respondent with the Fund. The provisions of Section 10, as cited by Mr. Cola, are correct Under Section 10 of the National Social Security Fund Act Cap. 230, it is provided that every contributing employer shall, for every month during which he or she pays wages to an eligible employee, pay to the fund, within fifteen days next following the last day of the month for which the relevant wages are paid, a standard contribution of 15 percent calculated on the total wages paid during that month to that employee. It is mandatory for every employer to make a standard contribution of 10% of an employee's wages, deduct 5% of the wages, and remit the same to the fund. The evidence, CEX 2, are journey bills that show that the Respondent paid the Claimant UGX 70,000/= per trip. And it was not contested that the Respondent paid the Claimant's salary, despite the Respondent having been allowed to challenge these facts in Court. Following CEX1, which was a letter from the Fund confirming that the Respondent made no remittances in respect of the Claimant, its registered employee, we are inclined to enter a declaration that the Claimant is entitled to unremitted contributions as we now do. In the absence of any other evidence, issue one is answered in the affirmative. It is declared that the Claimant is entitled to unremitted NSSF contributions. As to computation and recovery of any such remittances, these are matters governed by Sections 47, 48 and 49 of the Act which do not rest such action in this court.

# *Issue l wo: Remedies*

# *General Damages*

[10] In Industrial jurisprudence, the principle established by the Supreme Court in *Uganda Post Limited v Mukadisi<sup>4</sup>* is that an employee would be entitled to a claim for general damages as an independent award for unlawful termination. The relevant considerations in determining general damages are that general damages are not tied to specific financial losses. The court assesses general damages and is not restricted to the salary or pecuniary benefit stipulated in the employment contract. They are awarded to compensate the employee for non-economic harm and distress caused by the wrongful dismissal. These damages include compensation for emotional distress, mental anguish, damage to reputation, and any other non-monetary harm

<sup>1</sup> [20231 UGIC 77

<sup>2</sup>[20191 UGIC 1

<sup>3</sup> [2022] UGCA 75

<sup>4</sup> [2023] UGSC 58. We cited this decision in Sserunjoqi v Safeboda (Labour Dispute Reference 47 of 2022) [2024] UGIC 36 (16 August 2024)

suffered as a result of the dismissal. This is very much in keeping with the dicta of Lord McNaughten in *Stroms v Hutchinson* where general damages are such as the law will presume to be the direct natural or probable consequence of the act complained of.<sup>5</sup>

**[11]** In the present case, the Claimant has been deprived of his social security contributions over <sup>a</sup> work life of nineteen years. The function of social security benefits is to provide for an age-old benefit after one's active or productive work life. Deprivation of such benefits poses considerable difficulties for senior citizens, as these contributions provide <sup>a</sup> vital source of income, particularly for retirees, by reducing poverty and offering a steady stream of income. It is our persuasion that this is a wrong for which an employee should be entitled to general damages. In *Alaba v Bank of Uganda <sup>6</sup>,* we held that, having been deprived of her accrued benefits for well over nineteen years, the Claimant would be entitled to general damages. In our considered view, at an earning of UGX 200,000 per month, the sum of UGX 3,800,000 should suffice for general damages, and we so award the claimant that sum.

*Costs*

- **[12]** Our dicta on costs is that in employment disputes costs are the exception, except in cases where the losing party has been found to have committed misconduct.<sup>7</sup> In the present case, we are persuaded to award the Claimant costs. The Respondent did not remit NSSF contributions for nearly 20 years and failed to appear in court. For these reasons, the Claimant will have the costs of the claim. - **[13]** In the final analysis, the claim succeeds in the following terms: - (') It is hereby declared that the Claimant is entitled to unremitted social security contributions for his years of service to the Respondent. - (ii) The Respondent shall pay to the Claimant UGX 3,800,000/= in general damages. - (iii) The Claimant shall have the costs of the Claim

It is so ordered. **Deliverei and dated at Gulu this 4th day of June 2025 The Pan lists Agree** Anthony **Judge,** I 'abwire Musana, **lustrial Court**

<sup>5</sup> [1905] A. C 515

<sup>6</sup> [2025] UGIC 33

<sup>7</sup> See Kalule v Deustche Geselischaft Fuer Internationale Zuzammenarbeil (GIZ) GMBH [2023] UGIC 89

# **The Panelists Agree**

1. Hon. Adrine Namara,

2. Hon. Emmanuel Bigirimana &

3. Hon. Can Amos Lapenga

**4th April 2025**

**5.27 p.m.**

**Appearances**

- **1. None for the Claimant:** - **2. None for the Respondent:**

Claimant in Court

Court Clerk: Mr. Samuel Mukiza.

Claimant:

My lawyer has gone to Nwoya. He has a case there.

Court: Award delivered in open Court.

Anthony ^abwire Musana, **Judgq, Industrial Court of Uganda.**