The Employment (Amendment) Act 2026: what small employers must change
Uganda's biggest labour law overhaul in two decades was assented to on 29 April 2026. Casual workers, probation, dismissal hearings and severance change.
On 29 April 2026 the President assented to the Employment (Amendment) Act, which law firms in Kampala are describing as the most significant overhaul of Uganda's labour framework since the Employment Act 2006. The amending Act was tabled as the Employment (Amendment) Bill and is cited by practitioners as the 2025 Act; as at the publication of the summaries we rely on here, the commencement date had not yet been gazetted. Small employers should not wait for that notice. Most of the changes codify what the Industrial Court has been deciding for years, and they raise the cost of getting it wrong.
Casual workers get a six-month clock
The most important change for shops, restaurants, farms and workshops is a new section 34A. Casual employment is capped at six continuous months, and laying a casual worker off and rehiring them counts as continuous service. After six months the worker must be offered a regular contract or be lawfully terminated. The common practice of keeping someone "casual" for two years on daily pay ends when the Act commences. Piecework, where pay is by output rather than time, is formally recognised in a new section 34B. Domestic workers are defined and expressly brought under the minimum protections of the Act.
Probation: silence now means confirmation
Under the 2006 Act a probationary period could run for up to six months, extendable once by agreement, and either party could end it on fourteen days' notice or the employer could pay seven days' wages in lieu. The amendment changes two things. If an employer keeps paying an employee after an unextended probation lapses, the employee is deemed confirmed. And pay in lieu of notice during probation rises from seven days to one month. Letting probation drift without a letter is now an expensive habit.
Dismissal: the hearing is mandatory and the penalty is automatic
Section 65 now requires a hearing before dismissal, with the reasons given in a language the employee understands, the right to a companion of choice, and five working days to prepare. If the employer skips the procedure, the Act imposes what the MMAKS summary calls an "automatic liability of four weeks' net pay" regardless of whether the dismissal was otherwise justified. New sections define unfair dismissal (any reason outside the listed grounds) and wrongful dismissal (a procedural or contractual breach, including breach of the disciplinary code in Schedule 2). The labour officer's basic award for unfair dismissal doubles from four to eight weeks' wages.
The grounds themselves are widened. Termination may now rest on redundancy, which is defined for the first time, on sickness beyond six months, or on a statutory breach. Dismissal grounds include absconding for more than 30 consecutive days and forged recruitment documents. A redundancy requires at least 30 days' notice to the Labour Commissioner.
Sick leave and severance are standardised
Sick leave becomes a six-month regime: full pay for two months, then half pay for four. Termination on grounds of sickness is allowed only after six months, with a doctor's opinion and settlement of contractual dues. Severance allowance, which the 2006 Act left to negotiation, is standardised at one month's salary for each year worked and extended to terminations for incapacity, redundancy and labour-officer terminations for unpaid wages.
Workplace duties for every employer
Two obligations apply regardless of size. The existing duty to have a sexual harassment policy is reinforced with a requirement to display it conspicuously, and a new section 6A makes harassment or intimidation of employees by an employer or its agents a criminal matter, with examples ranging from public tirades to insulting emails and withholding necessities owed under the contract. A new section 56A requires all employers to provide time, space or a facility for breastfeeding and for children aged 3 to 36 months, with standards to be set by the Minister.
Recruitment agencies and migrant workers
Agencies that place Ugandans abroad will need a two-year licence from the Minister, must be Ugandan-incorporated, and must ensure contracts carry a repatriation clause at the employer's cost. The Minister may also gazette jobs that are closed to non-citizens, with entry permits refused unless the Commissioner certifies an exemption.
What to do before commencement
- List every casual worker and their first day. Anyone past six months needs a contract or a lawful exit.
- Diarise probation end dates and issue a confirmation, extension or termination letter before each one.
- Write down your disciplinary procedure and the hearing steps, and train whoever runs them.
- Print and display the sexual harassment policy.
- Budget severance at one month per year of service for any planned redundancy.
The amendment rewards employers who keep tidy records. The ones who lose at the labour office will be those who cannot show a start date, a contract or a hearing notice.
Sources
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