BISHOP STUART UNIVERSITY, MBARARA CITY- UGANDA

QUESTION;
Examine the difference between termination of employment by notice and summary dismissal.

Introduction
In the work below, I will discuss the meaning of termination and dismissal, the difference
between summary dismissal and termination of employment by way of notice as well as the
examination of the two ways of termination of the contract of employment.
The contract of employment has to be terminated in accordance with the law and the contract of
employment. In the absence of express proceedings on termination, it has to be in accordance
with the law. Common law presumes that they must be expressed reasonably. Termination can
be with or without notice. It can be with or without a hearing. In some cases, termination can
even be summary.
The supreme court of Uganda has held in Barclays Bank of Uganda Vs Godfrey Mubiru1
that; (Kanyeihamba JSC, as he then was); “where a service contract is governed by a written
1
SCCA NO.1 of 1998
agreement between the employer and the employee, as in this case, termination of employment
or service to be rendered will depend both on the terms of the agreement and on the law
applicable”.
Termination of employment is the discharge of an employee from an employment at the
initiative of the employer for justifiable reason other than misconduct, such as expiry of contract,
attainment of retirement age, among others.2
The same section says that “termination” has the meaning given by section 65 which states the
instances under which termination is deemed: "(a) Where the contract is ended by the Employer
with notice. (b) Where a contract of service, being a contract for fixed term or task, ends with the
expiry of the specific term of the completion of the specified task and is not renewed within a
period of one week from the date of expiry on the same terms or terms not less favorable to the
employee. (c) Where the contract of service is ended by the employee with or without notice, as
a consequence of unreasonable conduct on the part of the employer, but before the expiry of the
notice. (d) Where the contract of service is ended by the employee, in circumstances where the
employee has received notice of termination of the contract of service from the employer but
before the expiry of the notice”.
Dismissal is “the discharge of an employee from employment at the initiative of his or her
employer when the said employee has committed verifiable misconduct.3
In Florence Mufumba Vs U.D. B4 it was held that in dismissing an employee, the employer
must establish that there is verifiable misconduct on the part of the employee. It is our view that
verifiable misconduct includes but is not limited to abuse of office, negligence, insubordination,
and all those circumstances that impute fault on the part of the employee which include
incompetence.
The principal example of dismissal includes termination of the contract initiated by the employer
either with notice or summarily5 as discussed below
Summary Dismissal
Dismissal requires notice, however where there is no notice, it is referred to as summary
dismissal. In the Employment Act 2006 it is provided that an employment may be terminated
where the contract of service is ended by the employee with or without notice, as a consequence
of unreasonable conduct on the part of the employer towards the employee;6

2
Section 2 of the employment Act
3
Section 2 Employment Act 2006
4
COCA 241 OF 2015
5
Pg 808 Labour law by Hugh Collins, Keith Ewing, Aileen McColgan
6
S. 65(1)(c)
Summary termination shall take place when an employer terminates the service of an employee
without notice or with less notice than that to which the employee is entitled by any statutory
provision or contractual term.7
Therefore, here the employee is terminated without notice any time for breach of contract
demonstrating an intention that he or she no longer wishes to be bound by its terms.
And an employer is entitled to dismiss summarily, and the dismissal shall be termed justified,
where the employee has, by his or her conduct indicated that he or she has fundamentally broken
his or her obligations arising under the contract of service.
The case of Bank of Uganda Vs Betty Tinkamanyire,8 is to the effect that an employer is
entitled to dismiss summarily, and the dismissal shall be termed justified, where the employee
has, by his or her conduct indicated that he or she has fundamentally broken his or her
obligations arising under the contract of service.
Barclays Bank v Godfrey Mubiru9 [Justice Kanyeihamba]. In this case, the respondent had
been employed by the appellant from 1969 until 1990 when he was summarily dismissed after
several warning against him for breach of duty, negligence and gross incompetence. He was in
the habit of lending more money to borrowers in excess of his powers, to the detriment of the
bank. He sued for wrongful dismissal and High Court found in his favor. On appeal to the
Supreme Court, Justice Kanyeihamba held that when an employee is in breach of a fundamental
term of his employment or guilty of sufficient misconduct, he or she may be dismissed
summarily without notice, and, before the expiration of a fixed period of employment. He went
ahead to say that summary dismissal is without notice and dismissal without notice also implies
dismissal without a right to be heard first.
The conduct of the employee here is viewed as sufficiently serious to justify immediate
termination of employment without notice. In this respect, if you are dismissed with disgrace,
you may not be entitled to pension. Ordinarily, summary dismissal may not suffice if the
employee has made a mistake once. However, one act of disobedience or misconduct can justify
dismissal only if it is of such a nature which goes to show in effect that the employee is
repudiating the contract or one of its essential terms.
It was held in EBIJU JAMES v UMEME LTD10 that the phrase fundamentally broken as used
in Section 69 Employment Act 2006 is not defined in the Act. However, under common law,
which applies to this contract by reason of the provisions of the Judicature Act, the law on
summary dismissal is, like in Barclays Bank Vs Mubiru 11 a dismissal without notice (and without
a hearing) and it is reserved for serious misconduct.

7
S.69 1) Employment Act 2006
8
Supreme Court Civil Appeal No.12 of 2007
9
Supreme court civil Appeal no.1 of 1998
10
[1959] 1 WLR 698 [2015]
11
(supra)
 The judge went further to state that; There is no exhaustive list of the misconduct that justifies
summary dismissal, but according to Laws Vs London Chronicle 12one isolated act of
misconduct is sufficient to justify summary dismissal. The test is stated in the above case to be
whether the conduct complained of is such as to show the servant to have disregarded the
essential conditions of the contract of service. That to justify summary dismissal, the breach of
duty by an employee must be a very serious one.
John Eletu v Uganda Airlines, 13The plaintiff was summarily dismissed due to gross
negligence. He brought this action on the premise that his summary dismissal was unlawful. In
distinguishing summary dismissal from termination, Manyindo, J held that under the former, the
employer gives no notice whereas in the latter, he must give notice or pay in lieu of such notice.
The principle behind payment in lieu of notice being that an employer is normally under no
obligation to provide work for his employer even if the employer is entitled to notice. The judge
further gave examples of conduct that would repudiate a contract or amount to a substantial
breach like. disobedience of lawful orders, misconduct, drunkenness, immorality, assaulting
fellow workers, incompetence and neglect. Such conduct would warrant a summary dismissal.
Further, in Shell Ltd Vs George Ndyabawe14, court held that an employer may dismiss the
employee summarily if by his or her conduct the employee repudiates the terms of contract of
employment or is in fundamental breach of the contract.
Termination of employment by way of notice.
The general principle at common law is that either party to a contract can bring it to an end by
giving notice to the other. Once notice is given, it cannot be withdrawn unilaterally. It must be
with knowledge and consent of the other party to whom it was directed. If a contract is for a
fixed period of time, the position of the law is that the employment cannot be lawfully
terminated before the end of that period unless the employee is in breach of contract or the
contract itself provides for prior termination by notice. The length of notice to bring a contract to
an end should be agreed to by both parties. If no notice is expressly agreed then the law requires
that ‘reasonable notice’ should be given, with the length depending on factors such as the
seniority and status of the employee.
In Jabi vs Mbale Municipal Council15 it was held that it is generally accepted that a dismissal
is wrongful if it is made without justifiable cause and without reasonable notice. The notice
required might be determined from the contract of service itself or custom or any written
regulations governing the employment of which the plaintiff was a party.

12
UGHCCD 15
13
(1984) HCB
14
Civil appeal No.6 of 2005
15
[1975] HCB 191
In Barclays Bank of Uganda v. Godfrey Mubiru 16the employment contract had a provision
enabling each party to terminate the contract. The Supreme Court thus held that if the dismissal
had not been summary dismissal, which the circumstances of the case justified, the employee
would have been entitled to one month’s notice or one month’s payment in lieu of notice. I think,
where any contract of employment, like the present, stipulates that a party may terminate it by
giving notice of a specified period, such contract can be terminated by giving the stipulated
notice for the period. In default of such notice by the employer, the employee is entitled to
receive payment in lieu of notice and where no period for notice is stipulated, compensation will
be awarded for reasonable notice which should have been given, depending on the nature and
duration of employment.”
It was held the Supreme Court in Bank of Uganda Vs Betty Tinkamanyire17 per Tseekoko JSC
held that: “In my opinion where any contract of employment like the present stipulates that a
party may terminate it by giving notice of specified period, such a contract can be terminated by
giving the stipulated notice for the period. In default of such notice by the employer, the
employee is entitled to receive payment in lieu of notice and where no period for notice is
stipulated, compensation will be awarded for reasonable notice which should have been given
depending on the nature and duration of employment…………… Payment in lieu of notice can
be viewed as an ordinary way of giving of notice……. The right of the employer to terminate the
contract of service whether by giving notice or incurring a penalty of paying compensation in
lieu of notice for the duration stipulated or implied by the contract cannot be fettered by the
court.”
However, in OKELLO NYMLORD v RIFT VALLEY RAILWAYS18 it was stated that this
does not mean that an employer can unreasonably terminate an employee’s contract because
there is a provision of payment in lieu of notice as was in the case under common law.
Apart from the contractual provision on notice, the Employment Act entitles an employee to
minimum notice which takes precedence over any lesser notice by contract___. This notice has
to be in writing an in the language the employee understands. Except for summary dismissal and
mandatory retirement by age, no employer shall terminate the contract of an employee without
giving notice to the employee.19 The Employment Act 2006 provides notice should not be;
a) less than two weeks, where the employee has been employed for a period of more than six
months but less than one year;
b) less than one month, where the employee has been employed for a period of more than twelve
months, but less than five years;

16
Civil Appeal No.1 of 1998
17
[2008] UGSC 21
18
[2014] UGHCCD 52
19
S. 58 Employment Act 2006
c) less than two months, where the employee has been employed for period of five, but less than
ten years; and
d) less than three months where the service is ten years or more.20
In practice, however, the best mode is for the employee to accept payment in lieu of notice. This
serves both the parties, but especially the employer. It is not wise for the employer to allow
dismissed employees to work out their notice. Such workers lack motivation and they may try to
revenge against the employer for the dismissal. Payment in lieu of notice is therefore treated as if
it is payment for damages for wrongful dismissal.
In Bank of Uganda vs. Betty Tinkamanyire 21it was held that; “…the party unlawfully
dismissed was entitled to monetary value of the period that was necessary to give proper notice
of termination which is commonly known in law as compensation in lieu of notice and that party
is also entitled to damages for breach of contract.
Examination of the difference between summary dismissal and termination of employment by
notice basing on my opinion.
The first difference is summary dismissal is the discharge of an employee from employment at
the initiative of an employer on the spot and without notice. A notice of termination is what an
employer uses to notify an employee as to end of their employment contract. While this notice of
termination usually is provided to an employee for reasons unrelated to his or her job
performance, for example, because business conditions necessitate layoffs or downsizing, it may
also be given to an employee for poor job performance or misconduct.
Secondly, since summary dismissal is usually as a consequence of gross misconduct for instance
which is conduct or behavior of the employee which is so extreme as to breach the contract of
employment like theft, physical violence, it is different from termination of employment by
notice where the employee is in breach of contract or the contract itself provides for prior
termination by notice.
Where termination without notice, the employee is entitled to his salary in lieu of such notice
while if summarily dismissed, there is no requirement for such notice or salary lieu. In Ekunola
V CBN $ Anor22, the court in deciding on whether an employee dismissed on grounds of
allegation of gross misconduct is entitled to notice or salary in lieu of notice held-: “that where
his dismissal is founded on misconduct the appellant is not entitled to any notice or salary in lieu
of notice and that it would be wrong in law to make any awards to him in that regard.
Termination is a right enjoyed by both the employer and employee while summary dismissal is a
sole right of an employer.

20
S. 58(3) (a) Employment Act 2006
21
Supreme Court Civil Appeal No. 12 of 2007
22
(2013) LPELR 20391 (SC)
Upon termination by way of notice certain benefits may accrue to an employee such as gratuity
while summary dismissal terminates the employment and may leave no room for entitlement to
benefits.
In my opinion, summary dismissal is procedurally unfair compared to termination by way of
notice. Because one is suspended without notice and pay. I suggest that it should be like, if you
feel summary dismissals is your only choice as the employer, you must still follow a fair
procedure as you would do for any other disciplinary matter. On the other side I find termination
of employment by notice is advantageous because a period is given before leaving the job which
may give the employee sufficient time to find comparable employment which makes it
procedurally fair.
Mores so, summary dismissal may have an impact on business itself where the dismissed
employee blackmails it. However, most of the people may argue that the reason for summary
dismissal of an employee normally focuses on the conduct of gross misconduct which reduces
the employee’s performance in the course of work, and also destroys the trust between him and
the employer plus the customers to the extent that the employer fails to retain him, I feel having a
disciplinary committee may be able to solve that other than dismissal which may affect the
business incase the employee goes out and blackmails it or even he or she can be given notice
which is by far better than summary dismissal because it gives one time to prepare or even
change to a better employee.
Conclusion.
The main difference is that Termination by way of notice gives the parties to determine the
contract at any time by giving the prescribed period of notice because it is due to breach of
contract, whereas dismissal is a disciplinary measure which carries on benefits because it focuses
on gross misconduct. However, basing on this distinction, termination by way of notice is by far
fair than summary dismissal because it gives the employee time to prepare for the next
employment.
REFERENCES
Employment Act 2006
CASE LAW
Bank of Uganda Vs Betty Tinkamanyire SCCA NO.1 of 1998
Barclays Bank v Godfrey Mubiru Supreme court civil Appeal no.1 of 1998
EBIJU JAMES v UMEME LTD [1959] 1 WLR 698 [2015]
John Eletu v Uganda Airlines (1984) HCB
Shell Ltd Vs George Ndyabawe Civil Appeal No.6 of 2005
Jabi vs Mbale Municipal Council [1975] HCB 191
Barclays Bank of Uganda v. Godfrey Mubiru Civil Appeal No.1 of 1998
OKELLO NYMLORD v RIFT VALLEY RAILWAYS [2014] UGHCCD 52
Bank of Uganda vs. Betty Tinkamanyire Supreme Court Civil Appeal No. 12 of 2007
OTHER SOURCES
Labour law by Hugh Collins, Keith Ewing, Aileen McColgan