Compulsory Enrollment of Police Officers into SACCO Is Unconstitutional

The compulsory enrollment of Police officers into the Exodus Co-operative Savings and Credit Society (Exodus SACCO) without their consent is unconstitutional, the High Court has declared in a landmark judgment, affirming that police officers have the right to freely choose whether to join any association.

The ruling also declared unlawful the salary deductions made from officers without their free, informed and documented consent, and found that Exodus SACCO had been operating its financial services without the licence required under the Tier 4 Microfinance Institutions and Money Lenders Act. 

 

The decision stems from a human rights application filed by human rights lawyer Steven Kalali against the Attorney General and Exodus SACCO under Article 50 of the Constitution.

Kalali argued that since the passing out of the 19th intake of police recruits at Kabalye Police Training School in 2015, thousands of newly recruited officers had been automatically enrolled into Exodus SACCO without their free, express or written consent. 

 

He also contended that monthly deductions ranging between Shs20,000 and Shs50,000 had been made directly from their salaries without authorization and that officers were never given a meaningful opportunity to opt out.

He further challenged the legality of the SACCO’s operations, arguing that it had accepted members’ deposits and issued loans for years without obtaining the licence required under the Tier 4 Microfinance Institutions and Money Lenders Act, 2016. 

 

The Attorney General denied responsibility for the salary deductions and maintained that the government had no knowledge of any violation of police officers’ rights. 

 

Exodus SACCO insisted that membership was voluntary, arguing that its by-laws require members to submit formal applications before joining. 


Justice Teko ruled that constitutional rights enforcement proceedings cannot be ousted by ordinary legislation because the case concerned alleged violations of fundamental rights rather than the internal affairs of a cooperative society. 

 

He also found that the Attorney General was a proper party to the suit because the government, as the employer of police officers, has a constitutional duty to respect, protect and promote the rights of its employees.

On the substantive issues, the judge held that Article 29(1)(e) of the Constitution guarantees every Ugandan, including serving police officers, the right to freedom of association, which includes both the freedom to join and the freedom not to join an association. 

 

The court found that Exodus SACCO failed to produce documentary evidence showing that officers recruited from the 2015 intake onwards had voluntarily applied for membership as required by its own by-laws. 

Although the SACCO maintained that members had signed application and salary deduction forms, it failed to produce even a single signed application despite being granted an opportunity to file additional evidence.

 

 

The court concluded that automatically enrolling newly graduated police officers into the SACCO without proof of voluntary applications did not meet the constitutional requirement for free and informed consent.

Justice Teko gave Exodus SACCO six months to regularize the membership of all affected officers by allowing them to choose whether to remain members or exit the cooperative without penalty while retaining access to their accumulated savings and dividends. 

 

The SACCO must also finalize its pending licence application with the Bank of Uganda within the same period or cease accepting new deposits and issuing new loans until licensed, although it may continue servicing existing loans and accounts.