Definitive Guide to Hiring in Uganda

Hiring in Uganda

Hiring employees compliantly in Uganda means doing it yourself or using an Employer of Record like Global Expansion. You should be careful using independent contractor agreements in Uganda so that you don’t run afoul of employment laws. To hire an employee compliantly and offer them mandatory benefits and compliant agreements, you can:

(a) Establish your own new legal entity, banking, accounting and payroll service in Uganda; or

(b) use an Employer of Record like Global Expansion who can handle all of the details for you.

Labor Laws in Uganda

Employee Probation Period

• Maximum length of probation period is 6 months but it may be extended to 1 year with the consent of a worker.

Annual Leave in Uganda

• 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.

Holidays in Uganda

Here is the full list of public holidays in Uganda:

Maternity Leave Uganda

• The law in Uganda says a female employee is entitled to leave as a consequence of pregnancy.
• This leave is for a period of 60 working days.
• At least 4 weeks of the maternity leave shall be for the period after birth or miscarriage.

Paternity Leave Uganda

• A male employee, after birth of child or miscarriage of a wife, is entitled to fully paid 4 working days of paternity leave in a year.

Sick Leave in Uganda

• In accordance with the Employment Act 2006, a worker, working at least sixteen hours a week, is entitled to pay sick leave on completion of one month of service with the employer.

Working Hours in Uganda

• According to the law, your normal working hours per day are 8 hours and these should not be more than 48 hours per week.
• By including the lunch and prayer time in hours of work, working hours should not be greater than 9 hours a day.

Overtime in Uganda

• Working hours shall not exceed forty-eight hours per week and any extra hours shall be deemed to be overtime
• Where hours in excess of eight hours per day or forty-eight hours per week are worked, they shall, in the absence of a written agreement to the contrary, be remunerated at the minimum rate of one and a half (1.5) times of the normal hourly rate if the overtime is on the normal working days, and at two (2) times the hourly rate where the overtime is worked on gazetted public holidays.

Termination of Employment in Uganda

• Termination of employment is the discharge of a worker from an employment at the initiative of the employer for justifiable reasons other than misconduct.
• The employment of a worker terminates on expiry of employment contract; or expiry of contract for a fixed term or completion of specific task without renewal.
• A worker may terminate an employment contract with or without notice in case of misconduct on the part of the employer; and also before expiry of termination notice period
• The required notice period depends on the worker's length of service as follows:
  • 2 weeks for service of more than 6 months but less than 1 year
  • 1 month for service of more than 12 months but less than 5 years
  • 2 months for service of more than 5 years but less than 10 years
  • 3 months for service of 10 years or more.
• There is a provision in the law regarding severance pay but this compensation is subject to negotiation between the employer and the worker.
• Severance pay is entitled to the worker after continuous service (of a particular employer) for at least 6 months.
• It is due in the following circumstance:
  • unfair dismissal of the worker by the employer
  • death of the worker at work not attributable to any misconduct of the worker
  • termination by the worker due to physical incapacity not attributable to any misconduct of his own
  • termination by reason of the death or insolvency of the employer
  • termination by a labor officer following the inability or the refusal of the employer to pay wages
  • and other cases as provided by the Minister.
• Amount of severance pay is negotiable between the employer and the worker or the labor union that represents them.

Notice Period in Uganda

• The required notice period depends on the worker's length of service as follows:
  • 2 weeks for service of more than 6 months but less than 1 year
  • 1 month for service of more than 12 months but less than 5 years
  • 2 months for service of more than 5 years but less than 10 years
  • 3 months for service of 10 years or more.

Severance in Uganda

• There is a provision in the law regarding severance pay but this compensation is subject to negotiation between the employer and the worker.
• Severance pay is entitled to the worker after continuous service (of a particular employer) for at least 6 months.
• It is due in the following circumstance:
  • unfair dismissal of the worker by the employer
  • death of the worker at work not attributable to any misconduct of the worker
  • termination by the worker due to physical incapacity not attributable to any misconduct of his own
  • termination by reason of the death or insolvency of the employer
  • termination by a labor officer following the inability or the refusal of the employer to pay wages
  • and other cases as provided by the Minister.
• Amount of severance pay is negotiable between the employer and the worker or the labor union that represents them.

Uganda Salary and Wages

13 / 14th Month Salary in Uganda

• No
• There is no statutory requirement to pay the 13th or the 14th month salary.
• Employees are entitled to 21 days of holiday pay.
• There is no evidence that bonuses are common.

• An individual in employment is obligated to make a contribution of 5% of one’s gross earnings to the national social security fund.
• An individual who is an employer is also obligated to make contributions to the national social security fund for each employee, amounting to 10% of their gross pay.

Immigration Uganda

• Only special passes and work permits allow foreign nationals to undertake employment in Uganda.
• Temporary work permits, called special passes, are valid for three months and may be extended for up to a maximum of five months.
• A work permit or entry permit is issued for up to three years and may be renewed every three years.
• Work permits are divided into seven classes (Classes A through G)
• Class F permits, which are issued to practicing professionals (for example, lawyers and accountants), require the submission of the following:
  • Qualifications and references or résumés
  • Copy of the passport (bio-data page)
  • Copy of a recent passport-size photograph
  • Clearance letter from Interpol or home country
  • Registration certificate with relevant professional body in Uganda
  • Cover letter from the organization
  • Copy of nonrefundable prepayment receipt or a copy of identification from nationals of Burundi, Kenya and Rwanda
  • Security bond
• Class G has two sub-classifications of work permits, which are Class G1 and Class G2.
• They are issued to employees.
• Applicants for Class G1 permits (missionaries, volunteers and workers for nongovernmental organizations [NGOs]) are required to produce the following documents:
  • Certified copy of qualifications
  • Appointment letter from the organization
  • Copy of the passport (bio-data page)
  • Copy of a recent passport-size photograph
  • Cover letter from the organization
  • Clearance letter from the Interpol or home country
  • An employment contract
  • Recommendation from the National Bureau for NGOs
• Applicants for Class G2 (expatriates) are required to produce the following documents:
  • Appointment letter from the organization
  • Copy of the passport (bio-data page)
  • Certified copy of qualifications
  • Copy of a recent passport-size photograph
  • Cover letter from the organization
  • Copy of nonrefundable prepayment receipt
  • Copy of security bond payment letter from Interpol or home country
  • Income tax clearance for the organization
• Foreign nationals may change employers after they have obtained work permits.
• However, they must apply for new work permits under their new employers.

Value Added Tax (VAT) in Uganda

• VAT is charged on taxable supplies made by taxable persons, the importation of goods other than in cases of exempt imports, and imported services by any person.
• The standard VAT rate is 18%; some items are zero rated and others are exempt.

Mandatory Benefits in Uganda

• These are mandatory benefits as postulated by law
• These include probationary period, annual leave, public holidays, sick leave, maternity leave, paternity overtime pay, notice period, and severance pay
• Mandatory benefits also include social security benefits.

Payroll Accrual in Uganda

Country Accruals Additional Information

Description

An individual who is an employer is also obligated to make contributions to the national social security fund for each employee, amounting to 10% of their gross pay. The maternity leave is granted with full pay. It includes at least four weeks after childbirth or miscarriage andmay be extended by 20 working days under special circumstances. The pay during leave period is financed by the employer.

Payroll Accruals Additional Information

Accrued Benefits in Uganda

Why use Global Expansion to hire in Uganda

Establishing a branch office or subsidiary in Uganda can be time-consuming, expensive and complex. With such a robust labor market in place, one must pay great attention to detail when structuring employment because Uganda labor laws are complex.

The company also has a responsibility to comply with specific employment practices dictated by Uganda law to maintain its good standing as an equal opportunity employer.

Global Expansion makes it easy for you to expand into Uganda. We'll help you hire your candidate of choice, handle HR matters and payroll, and ensure that you comply with local laws without the burden of setting up a foreign branch office or subsidiary. In addition, you'll have complete control and direction over your employees.

We enable you to stay in control of everything. Our Uganda Global Professional Employer Organization (PEO) and Employer of Record (EOR) solution provides you with peace of mind to focus on running your company and the security to enter new markets.