The Civil Division of the High Court has dismissed a case filed against telecom company, Africell by its employees over wrongful termination of contracts.
At the beginning of this month, at least 15 employees of Africell Uganda Limited petitioned the Civil Division of the High Court challenging wrongful termination of their contracts.
Led by Teddy Kisekka, the applicants wanted the court to declare that they were unlawfully terminated from their jobs.
As such, they wanted the court to order Africell Uganda Limited to pay them severance allowances, payment in lieu of notice, payment of terminal and benefits and redundancy pay among others approximated at Shillings one billion.
Through their lawyers of Cristal Advocates, the petitioners contended that they had been employed by Africell in various capacities for varying periods ranging from 10 and 15 years under Africell, which has had different names including among others Hits Telecom Uganda Limited, Orange Uganda Limited and Africell Uganda Limited.
They said that on September 10th 2021, the company served them with letters indicating that Africell Uganda Limited was stopping its operations in Uganda effective October 7th 2021, and terminating their employment effective November 30th 2021.
They noted that Africell is in the final stages of closing its business operations and exiting the jurisdiction of Ugandan Courts, and is clandestinely disposing off its known assets in Uganda.
In September, Africell Uganda released a statement indicating that it was exiting Uganda because of stiff competition and high indebtedness. It cited a debt of Shillings 250billion and a loss of more than Shillings 1.5 trillion that was reported in 2019 and was allegedly inherited about eight years ago when they bought Orange telecom.
Kisekka noted that Africell had extended private invitations to potential buyers to acquire its fleet of motor vehicles.
According to Kisekka, Africell had also resorted to secretive methods of disposing off their assets as opposed to public auctions and advertising in order to defeat the claimants and potential legal proceedings.
As such, the employees wanted the court to order Africell to produce and place at the disposal of the High Court, six properties or their value, which they said was likely to be sufficient to satisfy the decree in the main suit seeking compensation.
They included; one Mobile Switching Centre, One Home Subscriber Center, Nine Base Station Controllers and monitors 2G sites, which are nine in number. The others are four radio network controllers, four 3G site monitors, 440 3G site monitors and 600 2G monitors.
They also wanted an order for attachment of two bank accounts in Stanbic Bank or in the alternative, court directs the company to deposit One billion shillings with the court to force the company not to run away before concluding the legal battle.
Africell filed an affidavit in reply deponed by Andrew Bwengye, the legal manager of the company opposing the application, and stated that in line with communication, Africell issued notice of termination to all its employees per the approval of the Ministry of Gender, Labour and Socal Development, which termination was to take effect on November 30, 2021.
Bwengye also stated that Africell has no intention of leaving Ugandan market in the foreseeable future until it has concluded all outstanding legal and regulatory obligations.
Lawyer Edgar Tabaro, who also represented Africell, stated that the telecom’s assets listed in the notice of motion and affidavit in support of the applicants are currently in operation as the transition of business clients is still ongoing per Africell’s exit plan.
The internet, he said is relied on by a number of Government Institutions and Agencies, including Uganda Revenue Authority (URA), Uganda Police Force, and Uganda National Oil Corporation, all of whom would be greatly affected if the orders of the employees were granted.
On matters accounts in Stanbic Bank, the Africell legal manager said, are in operation and are being used by the company to meet all its obligations and outstanding payments, including salaries of the employees’ termination benefits.
“The applicants have not shown in any way that application meets test for grant of an injunction, in that they do not have prima facie neither do they have any basis for irreparable damage since their outstanding obligations have been met by the respondent. The applicants’ case is merely speculative and premature which Court should be inclined not not entertain,” he said.
RULING
The counsel of respondent (Africell) referred to Section 93 and 94 of the Employment Act which places claims of infringement of the rights granted under the Employment Act before the Labour Officer, and any Appeal arising there to the Industrial Court.
He concluded that the matter was before a “wrong Court.”
The Deputy Registrar, Jamson Karemani concurred with Africell’s legal counsel, and dismissed the case in his ruling.
“I do concur with the learned counsel for the applicant that the issue of jurisdiction goes to the root of the matter and cannot be resolved by this Court, but by the Judge who has the jurisdiction to handle the main matter. I accordingly decline to handle the same at this stage and order the matter proceed on merit.”
“The application in this case did not prove the conditions for either grant of an order or interim temporary injunction or even for attachment before judgement. This application therefore fails and is accordingly dismissed,” he ruled.
However, from circumstances of the case, Karemani declined to grant Africell costs of the application.
