you can start by checking if you can upload picture on the Users/Employees module, this way you avoid any problems with your custom module and focus your test on the images.
Then don’t be so sure your permissions on the upload folder are correct. There are many factors to consider:
permissions on the folder
ownsership on the folder
sticky bit on the folder so newly created files get the same permissions
permissions settings in config.php
possible .htaccess file restricting access
so you might need to give more information and look closer…