- Overview: Uganda
- Global HR Compliance
- Global PEO and payroll
- Work permit for hiring expats via PEO
- Contractor vs. employee: which is better?
Global HR Compliance in Uganda
If you hire international workforce, or plan to hire, then Hiring and Firing Workforce in Uganda Guide below will help you understand the nuances of labor legislation in the country.
Companies hire international workforce for various reasons but in most cases they are:
- entering the foreign markets to sell company products. To do so, the company hires sales representatives who would represent their product and sell it to their local client base.
- hiring a global talent with unique skills that is unavailable in the local market or costs the company less than the talent with similar skills hired in the home country.
Before entering a certain foreign market or engaging a global talent, it is crucial for the company to understand how it can make local hires and reward its workers on a monthly basis. Growing companies often face a challenge of paying benefits and bonuses to the commission-based independent sales representatives they are working with.
If you intend to hire and pay your foreign workforce in full compliance with labor laws and regulations of Uganda, then the Global Employer of Record service from Acumen International may be the best way for you to go. We are an International PEO company and we specialize in global employment, meaning we can employ your employees in Uganda and act as their legal employer on your behalf. We will payroll your foreign workforce monthly and provide benefits to them through our global network so you don’t have to set up your own legal entities there.
We are experts in global workforce employment in Uganda, and our goal is to become your single provider. Instead of working with numerous local staffing agencies and legal advisors, Acumen International can solve your global business challenges and save you time, costs, and resources.
Our team of English-speaking professionals frees you from working through language nuances. Acumen International works 24/7 and can assist you whenever you need, regardless of time zones. Our goal is to create tailored labor solutions for you that are managed legally and in full compliance with the local employment laws.
With our knowledge and deep understanding of local nuances, you easily satisfy your need for skilled professionals in your global industry. With our qualified local partners, you can trust that your global workforce satisfies all local tax, social security, and immigration requirements in Uganda.
See Hiring and Firing Workforce in Uganda Guide below for a general overview of labor rules and regulations in the country. Or contact us if you need to employ workers in Uganda or would like to get more details.
Hiring and Firing Workforce in Uganda Guide
# Employment contracts
There is no mandatory requirement under the Act for a contract of employment to be in writing. The Act applies equally to both written and oral contracts. However, an employee is entitled to receive from the employer a notice in writing laying down particulars including; parties’ names and addresses, date of commencement, job title, place of duty, wages, overtime payment, working hours, annual leave, terms on incapacity to work, notice of termination.
Employment relationships are contractual in nature. The contract can be written or oral and can be a fixed term contract, a part time contract of a full time contract depending on the agreement of the parties.
# Minimum (Statutory) Employment Rules and Regulations in Uganda
# Hours of work:
Subject to exceptions provided under the Act, the maximum working hours for employees are forty eight hours per week.
# Probation period:
There is no legal obligation on an employer to provide a trial period commonly referred to as ‘probationary periods’. However, it is a common concept in almost all employment relationships and thus the employment act provides guidelines on the same thus;
- The maximum length of a probationary period is six months but may be extended for a further period not exceeding six months with the agreement of the employee.
- It is prohibited to employ an employee on a probationary contract on more than one occasion.
# Annual leave:
The law entitles an employee to 21 days holiday with full pay per calendar year which may be taken at such times as may be agreed between the parties. There are daily and weekly rest periods which have to be observed.
# Parental leave:
The Employment Act provides for sixty working days with full pay as maternity leave and four working days with full pay as paternity leave. A female employee who becomes pregnant has the right to return to the job which she immediately held before the maternity leave or to a reasonably suitable alternative job on terms and conditions not less favourable than those which would have applied had the employee not been absent on leave.
# Sick leave:
An employee who has been in continuous service with an employer for not less that one month who is incapable of work because of sickness or injury is entitled to sick pay; for the first month‘s absence, the employee is entitled to full wages and all the other benefits stipulated under the contract of service.
If at the expiration of the second month the sickness continues, the employer is entitled to terminate the contract after complying with all the other terms of the contract.
Certain conditions have to be fulfilled for an employee to qualify for sick pay.
# State minimum salary:
Uganda’s minimum wage is 6,000 Ugandan shillings per month for all workers.
# Employee dismissal:
According to the Employment Act No. 6 of 2006, a contract of service shall not be terminated unless notice of termination is given. The notice should be in a form and language that the employee is reasonably expected to understand.
Where the employment contract has specified the notice period, that notice period has to be complied with or a payment in lieu of the same paid. However, the Act provides for minimum notice period based on the duration of employment.
There are 2 exceptions to the notice requirement; where the contract of employment is being terminated summarily and where the reason for termination is attainment of retirement age. An employer before reaching the decision to terminate or dismiss an employee on grounds of misconduct or poor performance explain to the employee the reason for which the employer is considering the dismissal and shall hear and consider any representations which the employee or their representative may make.
A contract of employment can be terminated by the employee with or without notice, as a consequence of unreasonable conduct by the employer towards the employee. The employee can also end the contract of employment where he has received a notice of termination from the employer but before the expiry of the notice period.
The Act does not require the employee to give notice to the employer, therefore the notice period will commonly be stipulated by the contract. Unless an employee is summarily dismissed, he must be given notice before termination. A contract of employment can be terminated by notice.
The notice must be in a form that the employee understands. The Act provides for statutory minimum notice periods. Where the employment is more than 6 months but less than a year, the notice should be 2 weeks, where the employment has been for more than 1 year but less than 5 years, the notice should be one month and where the employment has been for 5 years but less than 10 years, the notice shall be 2 months. Where the service has been for 10 years, the notice period should be for 3 months.
However, where the pay period is longer than the notice period, the employee is entitle to the longer period. An employee however can accept payment in lieu of notice. In calculating the notice period, any outstanding annual leave period that the employee is entitled to shall not be included in the notice period. During the notice period, the employee shall be allowed at least half a day off per week for the purpose of seeking new employment.
The employer is required to pay severance allowance where the employee has been in continuous employment for 6 months and been unfairly dismissed, died in service other than by his personal conduct, has become physically incapacitated while in employment not by his personal conduct. An employee is also entitled to a severance allowance where his termination is a result of the death, insolvency or inability to pay wages by the employer.
An employee is not entitled to severance allowance if summarily dismissed or when, if dismissed by the employer, refuses re-employment, or where he absconds from work for 3 days without leave and explanation to the employer.
Severance allowance is also not payable where the employee, having been employed by a partnership, upon dissolution is offered and unreasonably refuses employment with one of the partners or immediately after the death of his employer is offered and unreasonably refuses employment by the personal representative. The calculation of severance allowance is negotiable between the parties and is paid upon cessation of employment and any other payment paid to the employee on the cessation of employment shall be taken into account in calculation of severance allowance.
Acumen International can help you fast-track your possibilities of entering and expanding your business in Uganda by providing you with our Employer of Record services. Our unique mix of PEO/EOR solutions will enable you to jumpstart your global operations almost immediately, cost-effectively and compliantly without any need to set up a legal entity first or afterwards.