Ex Coffee Marketing Board Employees Lose Bid to Increase Terminal Benefits, Ordered to Pay Costs

Terminal benefits for the former employees of the defunct Coffee Marketing Board (CMB) will have to be reduced to pay legal costs incurred by the government in defending the case which sought to increase their benefits.

This follows Court of Appeal has dismissing an appeal in which the ex-employees were claiming aggravated damages and enhanced interest on the agreed terminal benefits.

In the unanimous decision, a panel of three justices, Geoffrey Kiryabwire, Monica Mugyenyi and Remmy Kasule disallowed the appeal citing lack of merit and condemned them to legal costs incurred by the Attorney General (AG) and CMB in liquidation.

Justice Mugyenyi held in the lead judgement that the primary claim for terminal benefits were already determined by the lower court in a 2015 consent judgement.

“…the trial judge exercised his discretion well within the precincts of the legal provisions in awarding interest on terminal benefits from the date of the consent judgement,” Justice Mugyenyi held.

Three people; Basiima Kabonesa, Solome Adumo and James Musoke representing 1568 non-unionised former workers of the defunct CMB had appealed against a July 2015 consent judgment of the High Court. The Appeal was against the AG and CMB in Liquidation.

The court case resulted from continued claims for the outstanding benefits which were verified by the Auditor General at more than Shs10.3billion.

Court documents show that upon verification of the amount, it was presented to the government’s privatisation Unit for payment which declined to effect payment despite the legal opinion recommending for payment of the same.

At High Court

In the High Court, the former workers, AG and their former employers executed a consent judgement in which it was ordered that the complainants be paid UGX10,330, 013,506 as terminal benefits after they were retrenched between 1992 and 1998.

According to the judgement, each of the 1568 people was to be paid Shs10 million as general damages with interest but issues to do with the legal costs incurred, aggravated damages and interest thereon were referred for determination.

The court awarded the former CMB workers a block figure of Shs1 million to be shared equally by the plaintiffs with a 6 percent interest and a 10 percent on the UGX10 billion.

But the complainants, through their lawyers were dissatisfied by the High Court decision and appealed faulting the trial judge for erring in both law and fact while making the awards which were lower considering that circumstances.

The Court of Appeal declined to grant enhanced damages together with interest citing the circumstances surrounding the dispute

Justice Mugyenyi maintained that the complainants did not provide evidence to persuade court to interfere with the 10 percent per annum interest rate awarded on terminal benefits

The judge held the view that justice of the matter would not warrant an award of interest for the period prior to the institution of the suit; “All grounds of the appeal having been disallowed, the appeal would fail.”