Kenyan retailer, Uchumi Supermarkets, has been accused of not informing employees about its exit from Uganda, according to court documents filed in courts in the neighbouring state.
According to the court documents filed by 26 employees of the retail chain at the High Court in Kampala, Uganda, Uchumi management allegedly misinformed them that the branches were temporarily closed for renovation.
The employees are demanding their pay and damage costs owing to the indefinite closure of Uchumi's branches.
The employees through their lawyer, Claire Amanya, told Judge Opesen Thadeus that they were issued with annual leave forms that required them to vacate the supermarket chain premises, only to be left without work.
The 26 employees sued Uchumi's mother company, Uchumi Supermarkets Limited, Industrial and Commercial Development Corporation (Uganda), Creative Consolidated Systems and Uchumi's CEO Julius Kipng'etich. They want these listed entities and persons to be committed to fraud.
"The plaintiffs aver and contend that the defendants are jointly and severally engaging in various gross acts of fraud and deceit, breach of statutory trust and breach of contract for which they should be held liable.
"They are worried that the respondents are misinforming the Ugandan public that their work stations have been temporarily shut down, while using this approach to cover up their intention to remove assets out of reach of the applicants and rearrange the company in a way that will fleece workers. They argue this was detrimental to their interests and those of the landlord, suppliers, creditors and the general Ugandan public," Amanya argued.
The retailer closed its 11 branches in Uganda and Tanzania, citing operation losses over last five years. Mr Kipng'etich disclosed that five shops in Uganda and another six in Tanzania were unable to meet their financial obligations despite Sh200 million being injected on a monthly basis.
He said despite the massive feed, the Uganda business posted a net loss of Sh28 million in the year to June 2014, while the Tanzania arm recorded a net loss of Sh150 million in the same period.
The two arms linked to the Kenyan retailer lost Sh25 million and Sh104 million in 2013, a loss that also forced it to pull out of the two East African countries.
The supermarket laid off 900 employees in Uganda and Tanzania after closing shop.