According to the Ugandan government, seven out of every ten employed Ugandans work without a signed contract, leaving them open to labor law violations and employment insecurity. The Gender and Labour Minister, Ms. Betty Amongi, claimed that in order to cut operational expenses, an increasing number of companies, mostly in the private sector, prefer to subcontract, outsource, or recruit people without proper documents.
This report is courtesy of The Monitor Uganda, a Ugandan news outlet.
She pointed out that the “illegal” arrangement aids businesses in obtaining labor without designating the people as employees on the payroll, shielding them from the obligation to pay pension contributions and Pay As You Earn (PAYE) tax or provide care or compensation to a worker hurt in the line of duty.
“Many employers in industrial parks do not give employees written employment contracts, resulting in a lack of job security and union representation, and yet it is a legal requirement in Uganda for the employer to provide an employment contract for each employee. In practice, just 30 percent of employees are engaged with a written contract,” Ms Amongi said.
The minister stated that she learned during her on-site fact-finding visits to workplaces that the majority of employees were unaware of their rights and responsibilities, including the demand for a safe working environment, and that those who were aware were frequently reluctant to speak up for fear of losing their employment.
Even if an employer only has one employee, the Ugandan Employment Act, of 2006 mandates that they establish written agreements with new workers and pay monthly contributions under the reformed National Social Security Fund (NSSF) Act.
In response, the Chairman General of the National Organization of Trade Unions (Notu), Mr. Usher Owere, suggested that a separate ministry be established to deal with labor concerns that are neglected in the Gender, Labour, and Social Development docket due to priorities around gender and minority group issues.
The minister added that roughly nine out of ten people who are working work in the informal sector, where pay is just half that of workers in the formal sector, and that 1.3 million of Uganda’s 11.3 million inhabitants, who make up its “labor force,” are “unemployed.”
There are up to 23.5 million Ugandans, aged 15 to 64, considered the “working population” in a country the minster disclosed had a 9.2% “national unemployment rate”.
Youth unemployment is greater, at 13.3%, according to Ugandan legislation, which defines youth as people between the ages of 18 and 30.
