” EMPLOYMENT LAW ALERT “
Background/Facts:
The question on who an employee is continues to linger. The modern economy where digitalisation has taken centre stage has been questioned. The fourth estate is no different, how do persons work under this business arrangement.
The question that arose in Yusuf Baliruno V. Central Broadcasting Services Ltd Labour Dispute Reference No. 92 of 2020 was whether a sports commentator who had offered his services for 19 years to CBS stations 88.8 and 89.2 is an employee.
The SM & Co. employment team analyses this case in line with international practices and provides insights on what you need to consider as a person offering services in the fourth estate and other specialised industries. Employment as we know it has been defined and refined and it is not enough to spend time offering services to an entity.
The Claim
The Claimant claimed
a. that he had been employed by CBS as a sports presenter since 2001.
b. that he regularly hosted programmes such as Akaati ke Mizannyo, Amafa Agafaafa and provided live commentary on major events including the Masaza and Bika tournaments.
c. that he had an employment identification card
d. that he contributed to the CBS SACCO
e. that he was unfairly and unlawfully terminated without pay.
According to him, CBS paid him a monthly remuneration that started at UGX 300,000 and later was increased to UGX 500,000.
He argued that these facts demonstrated that he was a long-term employee of the company and that CBS’s failure to give him notice or terminal benefits prior to his termination amounted to unlawful termination under the Employment Act 2006 now Cap 226.
The Response
CBS on the other hand denied any employment relationship and maintained
a. that the Claimant was first engaged as an intern and later a freelance journalist who operated independently and was paid on a per-assignment basis.
b. That he was never placed on the company payroll, no statutory deductions such as NSSF or PAYE were made and he exercised full control over his own work, schedule and broadcast content.
c. that he was at liberty to work for any other media house and CBS only paid him for specific work done not a fixed salary.
This sharp divergence of positions set the stage for the Industrial Court to address a question that has long troubled Uganda’s media and creative industries: when is a freelancer considered an employee?
The Decision:
The Industrial Court concluded that no contract of service existed between the parties.
The Claimant was not an employee but a freelance journalist who received payment for specific services rendered.
Consequently, there could be no claim for unlawful termination since there was no employment relationship to terminate.
Reasons for the decision:
1. Employment Relationship defined
In the absence of a written contract, an employment relationship can still be proven by oral or circumstantial evidence but the burden lies on the Claimant to proof existence of such evidence.
The Court emphasized that the essential elements of an employment relationship are:
• Control by the employer over how, when and where the work is done;
• Integration of the worker into the employer’s organization;
• Remuneration or salary paid at regular intervals; and
• Mutual obligation, meaning both parties owe duties to each other.
• Control exercised by the Employer.
2. The Nature of Payment and Control:
The Court acknowledged that the Claimant received regular allowances and facilitation payments, particularly UGX 100,000 for live commentary and UGX 30,000 for field coverage. However, it held that these were honoraria or per-task payments and not salary under a contract of service.
The Court applied the multiple test to determine the true nature of the relationship. It found that:
• CBS did not exercise control over how the Claimant performed his work. He conceived, produced and presented his own content.
• There was no evidence of CBS’s editorial approach to the Claimant’s work and in Court’s view, it was not estimable to edit and therefore control live broadcasts
• There was no evidence that he was subject to CBS’s internal disciplinary policies, working hours or supervision.
• He bore the economic risk of his own performance
and was not entitled to employment benefits.
3. Employment in the fourth Estate.
The court specifically analysed that the employment sphere is changing and reliance on only control is misleading. The analysis iof the gig economy and fourth estate showed that there must be a critical look at how journalists especially freelance journalists work.
A freelance journalist is one who:
“Acts independently and is free to sell stories or articles to anybody. The employer has no direct control over the tasks to be performed or the manner of their performance.” However not all journalists or employees of the fourth estate are independent contractors. The Court distinguished this case from two Kenyan decisions of Ibrahim Ulalo versus Nation Media Group and Edward Ngarega Gacheru v. Nation Media Group Ltd where journalists were held to be employees because their employers deducted statutory taxes, provided working tools and maintained editorial control.
4. Work without pay for 19 years
The Claimant made demand for his salary arrears for 19 years.
The Court noted that it inconceivable that a person would work for 19 years under an alleged employment relationship without seeking formalization or accountability.
The Claimant never made written demands or complaints about salary over nearly two decades but claimed all salary arrears for the period since he was employed. The court could not see how an employment relationship could be forged in these circumstances.
In the instant case, none of these employment indicators were present.
Lessons and Practical Implications of the decision for Employers
1. Clarity and Documentation:
Organizations should ensure that every engagement is clearly documented whether as a contract of service or a contract for services. Ambiguity can expose employers to legal risk should the employee be able to lead oral or circumstantial evidence to the confirm existence of an employment relationship.
2. An employment relationship maybe established by other circumstances:
Courts will not rely on the title “employee” or “freelancer.” The Courts will consider other circumstances such as whether the employee agreed to work for an employer, whether there is remuneration for that work, whether the employee is under the employer’s control, whether the employee’s tasks are integral to the employer’s business, who controls the work, who provides the tools and whether the worker is economically dependent on the organization.
3. Record keeping is essential:
Employers must maintain records of payments, correspondence and contractual terms. Where freelancers are engaged, companies should issue clear letters of engagement specifying that the individual is an independent contractor.
4. Avoid constructive employment:
Continuous engagement of a freelancer without formalizing their status may result in claims of implied employment. Regular review of freelance relationships is therefore crucial.
Lessons and Practical Implications of the decision for Employees
1. Know your status:
Workers should understand whether they are employees or independent contractors. Employment comes with statutory protections for example leave, NSSF and many others while freelance work offers flexibility but fewer protections.
2. Ensure that you obtain written contracts:
It is an employee’s statutory right to be issued with written particulars of the employment engagement. Without a written contract, it is extremely difficult to prove employment especially if payment is irregular or task-based.
3. Longevity does not necessary amount to an employment relationship:
Working for a company for many years does not automatically make one an employee. Courts will examine other circumstances such as the control, payment structure and integration to confirm an employment relationship.
4. Be vigilant and protect your interests:
Freelancers should negotiate written agreements, retain proof of payments and clarify terms such as copyright, ownership of work and termination procedures.
Conclusion:
The decision provides a landmark clarification on the difference between employment and freelance work in Uganda. It underscores that the substance of the relationship, not its duration or labels, determines whether a worker is an employee.
For the growing creative and gig economy including journalists, artists, media personalities and digital
content creators, this case serves as a wake-up call to define and formalize work relationships. For employers, it offers reassurance that freelance engagements, if properly managed and documented, may translate into employment obligations.
The employment sphere is changing fast. Are you ready for the change?
Disclaimer:
This publication is for general consumption and should not be taken and relied upon without seeking specific legal advice on any of the matters above.