A group of over 400 former employees of Crane Bank have threatened to sue DFCU and the Central Bank for what they say was unlawful termination of their employment contracts.
They are demanding the terminal benefits owed to them in addition to Shs 120 million each for the losses they have incurred as well as inconvenience since February 2017 when they were sacked.
The former employees in the intended suit whi represent several others include Achan Catherine Kate, Akullo Teddy, Angwema Janet Mector, Arinaitwe Mactose, Bukenya Edward and Kiwumulo Lot Dianah. Others are Mivule Abbey, Muchwa Benjamin, Mwanje Robert and Ngororano Emmanuel.
They are represented by lawyer Isaac Semakade.
The notice of intention to sue stems from the now controversial take over of Crane Bank Ltd, at the time third largest commercial bank in Uganda, by DFCU due to the former’s distress.
In January last year, Bank of Uganda notified the general public that it had transfered and conveyed the assets and liabilities of Crane Bank to DFCU in order to reduce the risk that Crane Bank posed to the financial system.
As a result, DFCU after inheriting assets and liabilities of Crane Bank, wrote a memo to its entire staff on February 24 2018 to the effect that several employees would be collectively terminated.
However, in their notice filed by their lawyers Centre for Legal Aid, the former Crane Bank employees say the termination of their employment contracts was unjustified, unfair, discriminatory, degrading, demeaning and in breach of the law.
They contend that “Bank of Uganda acted in bad faith, negligently, fraudulently and in breach of its duty under the constitution and the law regarding protection of rights/interests of the intending plaintiffs during the [Crane Bank] take over”.
Bank of Uganda is accused of concealing details of the purchase and take over agreement from the ten former staffers yet their rights were directly affected in the take over process.
Their frustrations are also informed, they say, by the recently divulged report of the Auditor General concerning the role of the Central Bank in the forced closure of local banks.
“The intending plaintiffs understand that the Bank of Uganda induced and/or encouraged DFCU Bank to conduct an illegal exercise of collective termination selectively targeting the intending plaintiffs in the wake of the controversial take over of Crane Bank assets and liabilities by DFCU by purporting to exclude statutory duties owned to the intending plaintiffs during the impugned take over,” the notice reads.
The ten say they have suffered great distress, hurt feelings, humiliation, inconvenience and financial loss as a result of “the high handed and unlawful acts of DFCU and Bank of Uganda”.
They now seek general and punitive damages arising from the loss of their employment after they were transfered to DFCU.
Their total compensation claim amounts to Shs 48 billion.
While addressing a press briefing at Hotel Triangle together with the aggrieved former employees, Semakade said: “They [former employees] previously served DFCU with a notice of intention to sue but DFCU replied saying that any responsibility for compensating these workers group in the sum of Shs 48bn, Bank of Uganda should be involved”.