A Kampala microfinance bank to pay sh18m over dismissed employee

_______________

The Industrial Court has ordered UGAFODE Microfinance Limited to pay its former database administrator shillings 18 million in compensation for unlawful dismissal.

In a decision delivered on March 9, 2026, Anthony Wabwire Musana, sitting with panelists Adrine Namara, Susan Nabirye and Michael Mato, awarded the compensation to Peter Clever Katende after the court found that he had been unlawfully terminated from employment.

On July 3, 2023, a labour officer at Kampala Capital City Authority, Wilson Jingo, ordered UGAFODE Microfinance Limited to pay sh42 million in compensation for unlawful termination, equivalent to three months’ salary. However, the company appealed the decision before the Industrial Court of Uganda.

UGAFODE Microfinance Limited management stated that Peter Clever Katende was found to have breached the company’s policies.

The company alleged that he failed to restore the database auditing security features on its core banking system following its reinstallation on January 22, 2022. This, according to management, was in violation of the organisation’s ICT policy and procedures, as well as his signed job description and the human resource policies.

Consequently, Katende was invited to a disciplinary hearing at the company’s head office on April 27, 2022, where the disciplinary committee reviewed the allegations against him. Katende joined UGAFODE Microfinance Limited on February 20, 2019, and he was terminated on April 29, 2022. His last salary was sh6m.

The Industrial Court of Uganda agreed with the labour officer at Kampala Capital City Authority, stating that UGAFODE Microfinance Limited had unfairly terminated Peter Clever Katende from employment.

“Beyond the inconvenience of his termination, the respondent (UGAFODE Microfinance Limited) did not present evidence of a diminution in his employability. Therefore, we think that an award of shillings 18 million representing three months' salary, would suffice in general damages,” Justice Musana said.

The court further noted that UGAFODE Microfinance Limited had no justification to dismiss Katende from employment and his dismissal was both unfair and unlawful and he was entitled to remedies.

“The orders of Jingo, the labour officer, issued in labour dispute number KCCA/CEN/308/2022, issued on July 3, 2023, is confirmed with the one modification. The appellant Uganda Microfinance Limited shall pay the respondent (Katende) the sum of sh18m in general damages,” Justice Musana said.