Finance Trust Bank, has asked its staff to refund a portion of their salaries received during the Covid-19 lockdown when government restrictions prevented them from getting to work.
According to a memo sent to all staff on June 12th by Annet Nakawunde Mulindwa the bank’s CEO, staff who were not able to get to work because of the government restrictions were asked to convert the unworked days into annual paid leave.
However the bank only allows for 24 days of paid leave in a year, yet government lockdown lasted for a combined 49 days, including weekends. Now the bank wants staff to refund the salary earned during the time they were on lock down, that exceeds the 24 working days.
“Reference is made to the Government of Uganda directive following the outbreak of COCID 19 to lockdown the economy in a series of weeks i.e. 14 days, 21days and 14 days. The lockdown prompted suspension of public and private transport which prevented the majority of you from accessing the offices. The Bank therefore granted Annual leave to all staff who could not be able to make it to the office, given the limited means,” Mrs Mulindwa told staff in the memo.
“As you are all aware, staff are entitled to 24 days of annual leave in a year and those days were to be utilized for the period of 2020. However, we noted that the extended lockdown fully utilized the entitlement of the 24 days, allowing extra days for some staff. Given that background, the Bank considered the days over and above the 24 days entitled in 2020 as unpaid leave. Since the Bank already paid salary for those days, the affected staff will be allowed to pay back the funds for those days within a period of six months i.e. six installments,” she further says.
“For those whose deductions are already above the statutory deductions, they will be given a waiver to pay in an agreed extended period beyond six months. The HR department will share with all the concerned staff the deductions to be made with effect from June 2020. Please understand that this measure is being taken to maintain you at work and we expect your full cooperation,” the memo adds.
“I also wish to use this opportunity to appreciate all staff who worked throughout the crisis of the lockdown. Also important to extend a vote of thanks to our Board of Directors and Shareholders for allowing to pay our salaries in full, and on time. In appreciation, let us refocus our energies towards growing the business to sustain the Bank,” concludes Nakawunde.
“The decision is to protect jobs”, bank responds
In a phone interview with this reporter, Percy Lubega, the bank’s Head of Marketing and Communication’s says the decision is to be able to allow the bank to remain afloat given the shocks it has suffered due to Covid-19.
Bob Okodi, Amref Health Africa Uganda CFO, On Purpose-Driven Finance and Measuring Impact in Lives, Not Margins“This decision has been taken in the interest of all stakeholders,” he said on the phone, adding that the bank is trying to preserve itself against shocks it has suffered during Covid-19.
Asked if the decision had been reached with consent from staff, Mr. Lubega said: “This is an administrative aspect. Of course we looked at all the options and we have an information system that obtains opinions from staff but we didn’t call a town hall to agree. But we are certain that with all the options available this was the best for the staff and the bank.”
Last year, Finance Trust Bank made UGX6.1 billion in profit and UGX5.8 billion in 2018.
Mr Milton Turyareeba, the chairman of the Confederation of Free Trade Unions (COFTU) said the bank should follow the law.
“Where deductions are involved, they must follow what the law says; the employment act especially,” he said on phone.
“This letter seems to indicate that everybody was expected to continue working,” he said adding that the decision is illegal, “because employees did not bring Covid-19 and neither did they announce the lock down. The bank should have made a provision for staff to come to work. My view is that the bank should enter negotiations with the affected staff and their union.”
Section 41, Clause (6-7) of The Employment Act 2006 forbid such deductions. Clause 6 (a) says that an employer cannot deduct an employee’s wages for “absence attributable to the occurrence of exceptional events preventing the employee from reaching his or her place of work or from working.”
Clause 7 further says that an employee who has completed at least three months’ continuous service and is prevented from getting for work for the above exceptional reasons is “entitled to receive wages as though he or she had not been absent from work and had fully performed his or her duties under his or her contract of service throughout the absence, and his or her wages shall not, by reason of his or her absence, be subject to any deduction.”
