The High Court has ordered Uganda Martyrs University (UMU), Nkozi, to pay a former employee Shs 8 million in general damages for delaying payment of his gratuity and terminal benefits for about six years after his employment contract expired.
The Industrial Division of the High Court awarded Oyo Vincent Shs 8,014,230, ruling that the university’s prolonged failure to settle his employment benefits caused him prejudice, which was not erased by its eventual payment of the outstanding gratuity.
A panel of judges led by Justice Anthony Wabwire Musana, alongside Justices Adrine Namara, Susan Nabirye and Michael Matovu, found that although the university had acknowledged its obligation to pay Oyo, it failed to honour that commitment promptly.
The dispute arose after Oyo’s employment contract expired on April 30, 2016. Under the university’s Human Resource Manual, he was entitled to gratuity and other terminal benefits upon the expiry of his contract.
In his claim filed on April 11, 2019, Oyo told court that he had worked for the university from June 1, 2014, to April 30, 2016, and that the Chief Finance Officer had calculated his gratuity at Shs 15,908,247.
He further presented a letter dated September 5, 2016, in which the university undertook to pay the amount but failed to fulfil its commitment.
Efforts to resolve the dispute through mediation before the Mpigi District Labour Officer were unsuccessful, prompting Oyo to seek court intervention.
He argued that the university’s failure to pay his earned gratuity and terminal benefits was unlawful and unfair. He consequently sought payment of the outstanding amount, general damages, interest and legal costs.
The university, however, disputed liability, arguing that the claim was premature because the matter was still pending before the Mpigi District Labour Office.
It also contended that Oyo had failed to complete the required clearance procedures and had retained some of its property, which delayed the processing of his gratuity.
The university further told court that, following a demand from Oyo’s lawyers, it prepared a payment schedule and issued a cheque. However, the cheque was reportedly rejected after Oyo requested that the money be paid directly to him rather than through his lawyers.
It maintained that it had never refused to pay his gratuity but was waiting for him to complete clearance and provide proper payment instructions. It also disputed the amount claimed, arguing that he was only entitled to the net gratuity after tax deductions.
On December 19, 2022, court entered judgment on admission in favour of Oyo for Shs 11,247,167, settling the principal gratuity claim.
However, the remaining dispute concerned general damages and interest arising from the university’s prolonged delay in settling the employment benefits.
In resolving the outstanding claim, the judges observed that the university had acknowledged its obligation to pay Oyo Shs 15,908,247 but only settled the principal amount approximately six years after his employment ended.
“The obligation was not promptly discharged, and that is the crux of this dispute. The Oyo took reasonable steps to enforce his entitlement, while the Uganda Martyrs’ delay frustrated his efforts to obtain the fruits of his service,” the judges observed.
The court rejected the university’s position that the eventual payment of the gratuity was sufficient to resolve the dispute, noting that the delay had already caused prejudice to the former employee.
“Having considered the evidence on record, the applicable law, and the authorities cited, we find that the Claimant is entitled to general damages for the Respondent’s prolonged and unjustified delay in paying his gratuity and terminal benefits. The university’s eventual payment of the principal sum does not extinguish the prejudice caused by the delay,” the court ruled.
The university was consequently ordered to pay Oyo Shs 8,014,230 in general damages.
