Uganda’s New Employment Law: What Every Worker & Employer Should Know

For almost twenty years, Uganda’s workplaces were governed by the Employment Act of 2006. It was a good law for its time, but the world of work has changed. Some workers stayed ‘casual’ for years without any security. House helps were barely recognised by the law. How much severance pay a worker got depended on how well they could negotiate. And many of the rules on firing someone fairly were found only in court judgments, not in the law itself.

The Employment (Amendment) Act, 2026 changes much of this. The President signed it on 29^th April 2026, and it came into force on 5^th June 2026. It already applies to every employer in Uganda, large or small, including households that employ domestic workers.

A. More workers are now protected

Casual workers can no longer stay casual forever. Before, an employer could keep someone on casual terms for years. Some did this by laying the worker off and rehiring them, so the clock kept starting again. Now no one can be a casual worker for more than six continuous months. Laying someone off and rehiring them no longer resets the count. After six months, the worker is entitled to a proper contract, with the job security that comes with it.

For example: A cleaner hired as a casual worker in January, ‘released’ in June and rehired in July is treated as having worked continuously. By July, the employer should be giving her a proper contract.

Domestic workers are now recognised.

House helps, cooks, gardeners and others who work in homes are now clearly defined as workers under the law. This applies when the work is their job, not a one-off favour. The law also allows special rules to protect them. For the many Ugandan families who employ help at home, this is a big shift: your home can now legally be a workplace.

Piecework is formally recognised

Workers paid per task or per unit, such as tailors, brick makers or farm pickers, now have their arrangements formally recognised in the law.

Harassment and intimidation are now crimes

Before, employers only had to have a sexual harassment policy, and many kept it in a file that nobody read. Now employers must put up anti-harassment measures where staff can see them. It is also a criminal offence for an employer or supervisor to intimidate or harass an employee.

The law gives examples: shouting at or humiliating someone in public, insulting a person’s ability or competence, sending threatening or insulting messages, including by email, withholding food or other basics the worker is entitled to, and/or disrespecting religious or national symbols, or insulting a worker’s modesty.

A conviction can bring a fine of up to UGX 10 million. Repeat offenders face higher fines and possibly prison. The law also defines “workplace” very widely. It covers offices, shops, homes, farms, construction sites, and even the cab of a truck or the seat of a tractor.

B. Sick leave has become much more generous

Before, a sick employee got one month on full pay, and the employer could then end the contract. Now the employee gets two months on full pay, then four months on half pay. That is up to six months of support before the employer can consider ending the contract. Even then, the employer must first get a doctor’s opinion on the employee’s condition.

For example, a worker earning UCX 1,000,000 a month who falls seriously ill would receive UGX 2 million over the first two months, then UGX 500,000 a month for the next four months. Under the old law, the job could have ended after the first month.

Breastfeeding and childcare support

Every employer must now give time, space or a facility for breastfeeding and childcare for employees’ children aged 3 months to 3 years. The Ministry will set detailed standards. Employers should start planning now, whether that means a small private room, flexible break times, or both.

Pregnancy is protected

No employee may be dismissed or disciplined because she is pregnant, or for any reason connected with her pregnancy.

C. Losing a job.

This is probably the most important part of the new law for both workers and employers.

Termination and dismissal are now clearly separated.

Termination means ending a contract for reasons that are not the worker’s fault. Examples are redundancy (the business closed, work was reorganised, machines replaced people, or fewer staff are needed) and illness lasting more than six months.

Dismissal means ending a contract because of the worker’s conduct. The law now lists the grounds; absconding, meaning being absent without permission for more than 30 days in a row; using forged documents or lacking the required qualifications when hired; conduct, at work or outside it, that may harm the employer’s business; or any other ground set out in the contract. If a worker is dismissed for any other reason, the dismissal is unfair.

No one can be fired without a hearing.

Before dismissing anyone, an employer must:

1. Explain the reasons in a language the employee understands.

2. Allow the employee to bring a person of their choice.

3. Give them five working days to prepare a response.

4. Listen to and consider their side.

If an employer skips this, it must pay the employee four weeks’ pay as a penalty, on top of anything else awarded. The employee has three months from the dismissal to complain to a labour officer.

Some reasons can never justify dismissal

Nobody may be dismissed or disciplined for; pregnancy, taking leave they are entitled to, joining a union or taking part in union activities, race, sex, religion, political opinion, marital status, HIV status or disability, filing a complaint against the employer, and/or being absent for up to three months for a genuine reason such as illness or injury.

Probation has changed too.

Ending a probation contract now requires one month’s notice, instead of seven days. And if probation ends but the employer does not formally extend it and keeps paying the employee, the employee is automatically confirmed. Employers can no longer leave people on probation indefinitely.

D. Compensation and severance

Unfair dismissal now costs more

A worker found to have been unfairly dismissed now receives a basic award of eight weeks’ wages, double the previous four weeks. A labour officer can then add between one and three months’ wages more, depending on factors like length of service and how hard it will be to find a new job.

Reinstatement comes first

If the Industrial Court finds that a dismissal was unfair, its starting point is now to give the worker their job back. It orders compensation instead only in a few situations: the worker doesn’t want to return, the working relationship has broken down, reinstatement isn’t practical, or the only problem was the procedure.

Labour officers’ decisions are now enforceable

Their orders can now be enforced through the Industrial Court. Before, many workers won their case but never actually got paid.

Severance pay now has a clear formula

Before, severance was left to negotiation, which often left workers with little. Now it is one month’s salary for every year worked. For example, an employer earning UGX 1,500,000 a month who has worked for five years is entitled to at least UGX 7,500,000 in severance. Severance is now also due when a contract ends because of physical incapacity, redundancy, or the employer’s failure to pay wages.

Redundancy needs notice

An employer planning redundancies must notify the Commissioner for Labour at least 30 days before ending contracts.

E. Working abroad and foreign workers in Uganda

Many young Ugandans have gone to the Middle East and other countries through recruitment agencies, and some have suffered abuse with nowhere to turn. The new law finally regulates these agencies directly. Only licensed companies can operate as recruitment agencies. Licences last two years and can be revoked. Companies whose directors have been convicted of trafficking or illegal recruitment cannot get a licence.

Agencies can only recruit for genuine jobs approved by the Commissioner. Breaking this rule can bring fines of up to UGX 20 million, and up to five years in prison for the people in charge. Agencies must explain the contract to recruits, have a next of kin witness it, keep records, and make sure recruits complete pre-departure training. Every foreign contract must allow the worker to come home at the employer’s expense, for example when the contract ends, when the worker can no longer work, or in the event of death.

For foreign workers in Uganda, the Minister will publish a list of jobs reserved for Ugandans. A foreigner can take one of these jobs only with an exemption certificate, for example where no Ugandan has the required skill or an international agreement allows it. East African Community workers and diplomats are not affected.

F. What the law does not do

It does not set a national minimum wage. Uganda still has no enforceable minimum wage, and many workers, especially in the informal sector, remain underpaid. Stronger protections are a real step forward. But without a basic pay floor, many low-income workers may not feel much difference.

G. What you should do now

If you are an employer

1. Put up your anti-harassment measures and brief your supervisors.

2. Review your casual workers, anyone working continuously for six months needs a proper contract.

3. Update your sick leave, probation and disciplinary policies.

4. Recalculate your possible severance costs using the new formula.

5. Plan for breastfeeding and childcare time or space.

If you are an employee

1. Know your rights; the right to a hearing, fair severance, and protection from harassment.

2. Keep copies of your contract, payslips and any letters from your employer.

3. If you are dismissed unfairly, you have three months to complain to a labour officer.

The bottom line is that Uganda’s employment law has moved from ‘whatever the contract says’ to a set of basic protections that no contract can take away. Workers gain real security, employers gain clearer rules, but those who ignore the process now face higher costs and even criminal penalties.

Which of these changes do you think will have the biggest impact on Uganda’s workplaces?

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