Uganda's labor laws are primarily governed by the Employment Act of 2006, which establishes the minimum standards of employment in the country. This comprehensive legislation applies to all employees, regardless of their nationality, who are employed under a contract of service. The Employment Act ensures that both employers and employees adhere to fair labor practices, promoting a balanced and just working environment.
Ensuring fair treatment, safe working conditions, and clear mechanisms for resolving disputes are at the forefront. This Act provides fundamental rights and protection to workers, including the right to fair wages, safe working conditions, and freedom from discrimination and forced labor. Uganda is committed to upholding international labor standards and has ratified several key International Labour Organization (ILO) Conventions.
These include the Freedom of Association and Protection of the Right to Organize Convention, 1948 (No. 87), the Right to Organise and Collective Bargaining Convention, 1949 (No. 98), and the Collective Bargaining Convention, 1981 (No. 154). These Conventions are instrumental in promoting fair labor practices, protecting workers’ rights, and preventing exploitation.
Key Aspects of the Employment Act
Application of the Act
The Uganda Employment Act applies to all employees, irrespective of nationality that the employers hire under the service contract. However, Uganda labor laws are not applicable in a family business where the family members and relatives are the only employees and employers. The maximum number of family members must not exceed five.
Types of Contracts
Employment contracts in Uganda can be oral or written, fixed-term or permanent. However, section 25 of the Employment Act 2006 states that the service contract can be written and oral. This type of employment contract is one where the employer and the employee agree upon certain conditions to become binding upon both parties. Fixed-term employment contracts are standard in Uganda. Labor laws in Uganda follow fixed-term contracts there, and an employer hires employees for a specific period. Indefinite period contracts are governed by the employment law Uganda guide, where the employment continues until the employer or employee takes action to end the arrangement. These are open-ended contracts, and the employees work in the organization indefinitely.
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Content Requirements
Contracts should specify the job description, working hours, wages, benefits, leave entitlements, and terms of termination. Construct and draft company rules, policies, and regulations in writing.
General Principles
The Employment Act ensures that both employers and employees adhere to fair labor practices, promoting a balanced and just working environment. The Act also prohibits discrimination on various grounds, including race, color, sex, religion, political opinion, national extraction, social origin, HIV status, disability, and marital status. Employers are mandated to ensure equality of opportunity and to actively eliminate any form of discrimination in their employment practices. The Act also provides specific protections for female employees, such as the right to maternity leave and safeguards against unfair dismissal.
Forced Labor
No person shall use or assist any other person in using forced or compulsory labour. Any person who contravenes this section commits an offence and is liable, on conviction, to a fine not exceeding forty-eight currency points or to imprisonment for a term of two years, or both and to a fine of four currency points for each day or part of the day on which the breach continues.
Discrimination in Employment
Discrimination in employment shall be unlawful and for the purposes of this Act, discrimination includes any distinction, exclusion or preference made on the basis of race, color, sex, religion, political opinion, national extraction or social origin, the HIV status or disability which has the effect of nullifying or impairing the treatment of a person in employment or occupation, or of preventing an employee from obtaining any benefit under a contract of service.
Sexual Harassment in Employment
Where an employee is sexually harassed in any way described in subsection (1) by the employer or representative of an employer, the employee is entitled to lodge a complaint with a labour officer and the labour officer shall have the powers to make all of the orders he or she could have made if the complaint was a complaint about unjustified disciplinary penalty or unjustified dismissal. Every employer who employs more than twenty-five employees is required to have in place measures to prevent sexual harassment occurring at their work place.
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Working Hours
The Act sets the maximum weekly working hours for adult employees at 48 hours, with an opt out available if an employee agrees to work longer hours. Workers are entitled to 24 consecutive hours of rest per week. The weekly rest may be taken on customary rest day (Sunday) or as agreed between the two parties. Normal working hours are 8 per day and 48 per week. Workers may be required to work overtime, provided that total working hours, inclusive of overtime, must not exceed 10 hours per day or fifty-six hours per week except when persons are employed in shifts. It is permissible to employ shift workers in excess of ten hours in any one day or 48 hours in any one week (without paying overtime), where the average number of hours over a period of three weeks may not exceed 10 hours per day and 56 hours per week. An employer is required to pay overtime at the rate of one and a half times the normal rate of pay (150% of normal wage rate). This rate is for working overtime on normal weekdays. Employees may not be required to work more than six consecutive days without a day’s rest. The maximum number of hours permitted per week is 48. (Employees may not exceed 10 hours per day or 56 hours per week.
Leave Entitlements
Annual Leave-Employees are entitled to seven days’ leave for every four continuous months completed service in a calendar year. A worker, working weekly for sixteen or more hours, is entitled to 21 working days paid annual leave at the rate of 7 days for each period of continuous 4 months of service on completion of 12 months of continuous service. The time to take annual leave has to be agreed between the parties. Sick Leave-Any employee who has completed at least one month of employment will be entitled to one month of sick leave at full pay. The total number of sick leaves an employee can take is 30 calendar days with full pay.
Female employees are entitled to 60 working days of paid maternity leave. If there is any sickness in the mother or the baby during pregnancy, the maternity leave in Uganda for foreigners and nationals can be extended to 20 working days. The Bill specifically forbids termination or dismissal of a female employee on grounds of pregnancy or for any reason connected with pregnancy. The Bill has however increased the period of Sick leave from two to six months before an employer can exercise the right to terminate an employee from employment on account of sickness.
Minimum Wage
Uganda does not have a nationally mandated minimum wage, but sector-specific wages may apply. The Act requires employers to pay their employees at least the national minimum wage as set by the government and the national minimum wage is reviewed annually. The minimum wage must cover the living expenses of the employee and his/her family members. Moreover, it must relate reasonably to the general level of wages earned and the living standard of other social groups.
Uganda’s statutory minimum wage has remained unchanged since 1984, set at UGX6,000 (approx. USD1.60) per month. In 2019, Parliament passed a Bill proposing a new minimum wage of UGX136,000 (approx. USD37), but it was rejected by the President. On 1 May 2025, during International Labour Day celebrations, the President pledged to revisit the issue, with Cabinet discussions planned for June 2025.
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Termination of Employment
The employment termination must be followed with a notice period. In case of unfair dismissal, an employee who has worked there for at least six months is entitled to severance pay. The Bill has therefore created a distinct statutory provision that specifically seeks to deal with dismissal-related issues and grounds for recourse to such a procedure. It also states that any other grounds set out in the Contract of Employment are applicable. The Bill, therefore, imposes a duty on an employer, in any claim arising out of dismissal, to give reasons for dismissal of the employee, and where the employer fails to do so, the dismissal shall be deemed to have been unfair. This provision of the Bill expressly eliminates the need for employers to give reasons for terminations under Section 65 of the Act, which has since been left entirely as a termination clause.
Administration of the Act
The administration of this Act shall be the responsibility of the directorate of labour acting under the authority of the Minister, as well as the local authorities as may be required under the Local Governments Act. The Commissioner may delegate, on the request of a district, to a district labour officer the exercise of any of his or her powers and the performance of any of his or her duties under this Act, generally or in part, and may revoke the delegation by written notice at any time.
Recent Amendments and Proposed Changes
Uganda has recently undertaken a series of legislative reforms aimed at modernising its employment and labour framework. These changes reflect growing concerns around worker protection, workplace safety, fair compensation, and long-term social security. On 24 May 2023, Uganda’s Parliament passed the Employment Amendment Bill No. 2 of 2022, introducing significant reforms to the Employment Act. On the 24th of May 2023, the Parliament of Uganda passed the Employment Amendment Bill No. 2 of 2022. While the amendment is under the Employment Act, the Bill has by cross reference amended other Legislations such as the Labour Disputes (Arbitration and Settlement) Act, 2006, Act No.
The Bill seeks to regulate the employment of domestic workers and casual employees. The current Act defines a casual employee but does not make provisions for the terms of employment of a casual employee. The Bill seeks to convert the employment of a casual employee who remains continuously engaged for four months to a term employment. The Bill proposes reducing the distance, so that an employee recruited for employment at a place more than 50 km away from his or her home, is entitled to repatriation at the expense of the employer. Further, the Bill also requires an employer to establish a lactation station at the workplace for the female breastfeeding employees. The Bill provides for the recruitment and employment of migrant workers. The Bill also seeks to regulate the employment of persons recruited for employment abroad by mandating the Minister responsible to prescribe the minimum employment standards applicable to such persons. The Bill seeks to provide for compulsory registration and licensing of the recruitment agencies for domestic workers and non-labourers. The Bill seeks to address long-standing loopholes in the substantive Act that affect less formal employees (like domestic workers, casual employees, migrant workers, and breastfeeding mothers) that have been avenues of exploitation and abuse. For this reason, the proposed amendments are a positive step.
Some of the key changes which have been introduced by the Employment Amendment Bill No. Over the 17 years of the application of the Act, the Industrial Court and the legal fraternity have noted that Labour Officers often lack the legal background to carry on quasi-judicial functions, especially arbitration, and adjudication. Secondly, there was the need to reconcile Sections 13 and 93 of the Employment Act as the scope and powers vested upon the Labour Officers in the two Sections were contradictory. The Bill prohibits discrimination against female employees on account of being breastfeeding mothers and requires a reduction in contractual hours to provide working breaks for a breastfeeding mother and the establishment of a lactation station. To curb the increasing risk of human trafficking, the Bill forbids the illicit or concealed movement of persons in or out of Uganda for purposes of Employment and makes it compulsory for all recruitment firms to obtain a recruitment license from the Commissioner for Employment Services before commencing business. The requirement to have a Job Order; Recruitment agencies are required to only recruit upon confirmation of a job order issued by the potential employer abroad. A job order should set out the number of employees required for the specific job, the skills required for the workers and the wages to be paid. Orientation of employees by the recruitment agencies before signing contracts. Record keeping: The recruitment agencies are obliged to maintain records for the employees who have been recruited. Requirement for all Employers to have and publish their sexual harassment policy. The current law only mandates employers with 25 employees or more to formulate and have sexual harassment policies.
Currently, Section 66 on the right to a fair hearing before dismissal left a lot to be desired and left it to the individual employer to follow their procedure for notification of dismissal and disciplinary hearings. The Bill seeks to clarify and harmonise the requisite procedure for the dismissal of the Employee. The Bill seeks to limit the type of jobs that can be offered to migrant workers in Uganda. Under the current Act, it is up to the employer and employee to agree on how the severance pay should be calculated at the time of contracting. Sections 3, 4 & 5 of the Labour Disputes (Arbitration and Settlement) which sets timelines for resolving labour disputes within 6 weeks (2 weeks to react and 4 weeks to resolve) have been repealed. This is after labour officers complained about the short timelines which they were accorded to handle labour disputes. This means that Labour officers can handle the disputes for a longer period.
In a parallel move to strengthen social protection, Uganda’s Parliament recently passed the Public Service Pension Fund Bill 2024. The bill introduces a contributory pension system for public servants, replacing the previous non-contributory model, and addresses long-standing concerns about the fiscal sustainability and equity of retirement benefits. Managed by a Board of Trustees including government, unions, and experts, the Public Service Pension Fund aims to boost national savings and finance development projects. The proposed law includes provisions to ensure that even employees who are dismissed from service receive pension benefits proportional to their years of completed service. While the reform modernises Uganda’s pension framework, labor unions seek improvements in governance representation.
Key Provisions of the Employment Act of Uganda
| Provision | Description |
|---|---|
| Minimum Wage | No nationally mandated minimum wage, but sector-specific wages may apply. |
| Working Hours | Maximum 48 hours per week; overtime pay at 1.5 times the normal rate. |
| Annual Leave | 21 working days paid annual leave. |
| Maternity Leave | 60 working days of paid leave. |
| Discrimination | Prohibited on grounds of race, color, sex, religion, political opinion, etc. |
| Sexual Harassment | Employers with over 25 employees must have prevention measures. |
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