Employment Protection in Nigeria
Employment Protection in Nigeria
ABSTRACT
Employment security is a relatively new concept in labour law. It was developed in the
nineteenth century as an exception to the common law doctrine of employment-at-will which
gave the employer unfettered freedom to hire and fire as a means of achieving flexibility in
adapting his business to economic and technological changes. This paper examines the problem
of employment security in Nigeria in the light of the tension between security and flexibility. It
also examines the common law doctrine of employment-at-will and the various exceptions which
have been developed at both international and national levels for the protection of workers against
arbitrary termination and unjustified dismissal by their employers. It further examines some
major issues in employment security in Nigeria and draws lesions from the United Kingdom and
South Africa. It offers suggestions for solving the problem of employment security in Nigeria.
Employment security may be used interchangeably with job security1 and refers to
protection against arbitrary termination and unjustified dismissal from employment. According
1
The two concepts only differ in the sense that job security relates, at the level of the individual
employees, to the current job and the security of being able to keep it; while employment security relates
at the collective level and, for a large part, deals with the future. See R Dekker, “Employment security:
54
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
to the international Labour Organization, ‘employment security means that workers have
protection against arbitrary and short-notice dismissal from employment as well as having long-
term contracts of employment and having employment relations that avoid actualization.”2 It is
clear from the definition that employment security focuses on those who are employees, that is,
wage and salary workers. It does not cover those who are job seekers or applicants for
employment3. It does not also cover self-employed workers. For this latter category of workers,
employment security depends on availability of and access to credit to continue or e expand
business, marketability of their products or services and access to skill training to diversify to
other work. It also depends on availability of space to carry out their activity. In the absence of
these, there may be exit from self-employment to unemployment.4
In a pure neo-classical economic point of view, labour is seen as a commodity like any
other. Employees sell their competence and their labour force while employers purchase the
amount that they deem necessary. Any hindrance to the smooth workings of the labour market is
considered as an obstacle to the general good. Devices for securing employment against the will
of any of the parties are seen as detrimental to all. The employment-at-will doctrine exemplified
this state of things.5
However, it soon appeared in practice that, indeed, labour is not a commodity like any
other merchandize.6 Firstly, labour has no independent material existence, separate from the
person of the worker and thus cannot be sold like any other commodity. Secondly, the relationship
between employer and employee has a different object for both of them. The employer is
concerned with the product of labour while the employee is concerned with the availability of
work. This inevitably resulted in a tension between the need for employers to adapt to economic
fluctuations on the product markets with the consequent necessity to adapt the workforce to
business volume, and the need for the employee to have a have a continuous gainful income from
his work.7 Thus, the real issue in job security is the need to balance the flexibility required by
employers to hire and fire at will and the need for protection of workers against arbitrary
termination and unjustified dismissal from employment.
The main argument in favour of flexibility is that organizations are usually forced to
change employment practices in the face of increased competition, fluctuations in demand,
technological change and volatile markets. It is argued that easy hiring and firing also favours
new ideas, new skills and new approaches to work. Employment security, on the other hand, is
seen as the main means to income security. It also encourages investment in worker training and
skill development, which in turn increases the commitment and motivation of workers, and the
productivity of the employing organization. It further leads to increase in worker loyalty and
discipline. Loss of employment generally leads to loss of income and loss of livelihood. This may
lead to hunger and misery not only for the person losing his employment but also for his or her
family and dependants as fall back options are few in developing countries that do not have a
a conceptual exploration” Working document for the programme “Employment security: new security
for a changing labour market” January 2010, 6-7
< media.leidnuniv.nl/…/20-20-10paper.ronalddekker-employment-secur> accessed 6 April 2016
2
See International Labour Conference, Protection Against Unjustified Dismissal (82nd Session, 1995;
Report III (Part 4B) (Geneva: ILO 1995) < http://www.oil.org/public/libdoc/ilo/P/09661/09661 (1995-
82-4B). pdf> accessed 5 April, 2016
3
See S Deakin and GS Morris, Labour Law (3ed, Butterworths 2001) 383
4
See S Dasgupta, Employment Security: Conceptual and Statistical Issue (Geneva: International Labour
Organization 2001) 3-4
< http://www.oil.org/public/English/protection/ses/download/does/employ.pdf> accessed 4 April 2016
5
See J Rojot, “Security of Employment and Employability” in R Blanpain, Comparative Labour Law
and Industrial Relations in Industrialized Market Economies (The Netherlands: Kluwer International
BV 2010) 460
6
See paragraph 1(a) of the ILO Declaration of Philadelphia of 9th May 1944 which declared that “labour
is not a commodity”
7
Ibid 460-461
55
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
system of unemployment benefits.8 The search for equilibrium between flexibility and security
has led to the emergence of the concept of “flexicurity” in industrial jurisprudence. This concept
was coined by Wilthagen and others to posit a mutual relationship or interplay between flexibility
and security9. It maintains that flexibility and security are not necessarily contradictory goals and
that they can even strengthen each other.10 In modern time, this equilibrium is achieved through
employment protection laws, both at the international and national levels, which prescribe rules
for hiring and firing.
The common law viewed the relationship between employer and employee as being on
equal footing in terms of bargaining power. Thus, the employment-at-will doctrine reflected the
belief that people should be free to enter into employment contracts of a specified duration, but
that no obligations attached to either employer or employee if a person was hired without such a
contract. Because employees were able to resign from positions they no longer cared to occupy,
employers also were permitted to dismiss employees at their whim11.
An employment described as permanent or pensionable does not mean an employment
for life; such employment is still terminable by notice12. This position was reflected in Elderton
v Emmens13 where it was stated that once a contract of employment was terminated, whether
rightly or wrongfully, “the servant or employee is in such a case effectively dismissed.” The
argument was that “no one, individual or company, can be compelled against his or her will to
employ a man.”14 Thus, the employer could terminate the contract lawfully by giving appropriate
notice of termination. There was no requirement placed on the employer to give reasons and no
one can question the motives of an employer for giving notice in England15. Even if the employer
dismissed the employee wrongfully because of inadequate notice or other form of non-
compliance with the contract of employment, the employee could bring a claim for wrongful
dismissal, but the remedy was limited solely to damages for the loss of pay for the period of
notice required under the contract16. The modern common law position was aptly stated in Vine
v. National Dock Labour Board17 where Lord Keith said:
It is clear that common law recognized some exceptions to the right of the employer to
hire and fire at will. In the first place, the power of arbitrary dismissal is now to some extent
restrained by statute. Thus, if rights are conferred by statute, the courts would intervene to protect
8
Dasgupta (n 4) 7
9
See RJA Muffels and RCJM Withagen, “Flexicurity: A New Paradigm for Analyzing Labour Markets
and Policies Challenging the Trade-off between Flexibility and Security” (2013) 7(2) Sociology
Compass 111
10
Dekker (n 1) 13
11
See CJ Muhi, “The Employment-at-will Doctrine: Three Major Exceptions” (2001) 1 Monthly Labour
Review, 1
12
See McClelland v Northern Ireland Health Board (1957)2 All ER 129 at pp. 133
13
(1848)6 CB 160
14
See Southern Foundries Ltd v Shirlaw (1940) AC 701
15
See G Ganz, “Public Law Principles Applicable to Dismissal from Employment” (1967) 30 MLR 288,
295
16
See SD Anderman, Labour Law: Management Decisions and Workers’ Rights (London: Butterworths,
1998) 139-140
17
(1958) AC 488
18
Ibid 507
56
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
the rights19. In the second place, where the right to terminate by notice is excluded by the contract,
the courts will enforce the terms of the contract. Thus, in McClelland v. Northern Ireland Health
Board (supra) the contract made provision for dismissal on grounds of gross misconduct or
inefficiency. The Board later sought to terminate the appellant’s employment by six months
notice on ground of redundancy. It was held that aside the express powers of termination
contained in the contract of employment, there was no room for anything else.
It has come to be accepted that civil servants enjoy a higher security of tenure than other
forms of employment. It has generally been held that civil servants hold their office at the pleasure
of the Crown.20 But this has been said to be mere convention. In practice, a civil servant’s tenure
is very much more secure than most other forms of employment.21 It is, in reality, the most
secure.22 This proposition has the support of the House of Lords in McClelland where Lord
Goddard stated that “the board offered and the appellant accepted employment on terms as secure
as is, in fact, enjoyed by civil servants.”23
Aside these exceptions recognized under the common law, the unfettered freedom of
contract which held sway underwent changes during the nineteenth century. The changes in
political and economic thought, the growth of trade unionism, the birth of ILO as the agency
charged with the responsibility for setting down global minimum labour standards, the evolution
of the concept of socio-economic justice and the increasing role played by the state in regulating
employer-employee relations, amongst others, are some of the factors that facilitated changes in
employers’ attitudes and management practices.24
19
See HWR Wade, Administrative Law (6ed, Oxford: Oxford University Press 1988) 66
20
See Dunn v The Queen (1896) 1 QB 116
21
See ECS Wade and GG Philips, Constitutional and Administrative Law (9ed, London: Longman 1979)
261
22
Wade (n 19) 65
23
Supra 134
24
See EM Rao, Industrial Jurisprudence: A Critical Review (Haryana: LexisNexis 2008) 173
25
See Article 23(1) of the United Nations Universal Declaration of Human Right, 1948; see also Article
6(1) of the United Nations International Covenant on Economic, Social and Cultural Rights, 1966;
Article 1 of the European Social Charter, 1961; and Article 15 of the African Charter of Human and
Peoples’ Rights 1981.
26
Blanpain (n 5) 462
27
ILO Convention 158 of 1982 replaced ILO Recommendation 119 of 1963.
28
ILO Recommendation 166 of 1982
57
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
Article 7 of the Convention embodies the important principle of fair hearing before dismissal or
termination of employment by the employer. It provides as follows: “The employment of a
worker shall not be terminated before he is provided with an opportunity to defend himself against
the allegation made, unless the employer cannot reasonably be expected to provide the
opportunity.” As a general rule, any worker who considers that his employment has been
unjustifiably terminated is entitled to appeal against the termination to an impartial body such as
a court, labour tribunal or arbitrator. However, a worker may be deemed to have waived his right
29
See ILO Convention 158 of 1982, Article 2(2); see generally, JM Servis, International Labour Law
(The Netherlands: Kluwer Law International BV 2011) 170; N Valticos, International Labour Law
(The Netherlands: Springer Science + Business Media B.V. 1979) 169
30
Under the scheme of the Convention, this is known as individual dismissal.
31
Under the scheme of the Convention, this is known as collective dismissal; see generally ILO,
Termination of Employment Digest: A Legislative Review (Geneva: ILO, 2000)pp. 28-29; Sims, E.
“Employment Security” in Humblet, M et al (eds) International Labour Standards: A Global Approach
(Geneva: ILO 2001) 227-229.
58
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
to appeal against the termination of the employment if he has not exercised that right within a
reasonable period of time after the termination.32
If the court or labour tribunal finds that the employment of a worker has been
unjustifiably terminated, if it is not empowered or do not find it practicable, in accordance with
national law and practice, to declare the termination invalid and/or order reinstatement of the
worker, it shall order payment of adequate compensation.33 These provisions clearly indicate that
the Convention prefers reinstatement as the primary remedy for unjustified termination of
employment. It is only when the court or labour tribunal is not empowered to order reinstatement
under national laws or when reinstatement is not practicable that the court or labour tribunal is
empowered to order adequate compensation. In the event of an individual dismissal, in addition
to an award for compensation for loss of employment, the Convention34 and Recommendation35
enjoin employers to provides severance allowance or unemployment benefits or a combination
of such allowance or unemployment benefits or a combination of such allowance and benefits for
any worker whose employment has been terminated. This is aimed at reducing poverty and
ensuring income security for the worker whose employment has been terminated. In the event of
collective dismissal for economic, technological, structural or similar reasons, on the other hand,
the employer is enjoined to provide placement of the workers affected in suitable alternative
employment as soon as possible with appropriate training.36
Nigeria has not ratified the ILO Termination of Employment Convention 158 of 1982.37
The law relating to termination of employment is, therefore, essentially based on the common
law position with few exceptions. This can be examined in terms of three major issues in job
security. These are fair hearing before dismissal, motive for termination and reinstatement as the
primary remedy for unjustified dismissal from employment.
The circumstances when the rules of natural justice would apply in a contract of
employment would depend on the type of employment in question. There are now three
categories of contract of employment in Nigeria. These are:
• contract of employment governed by the common law;
• contract of employment governed by written agreement, and
• contract of employment governed by statute or regulations made under statute.38
In Union Bank of Nigeria Plc v. Ogboh,39 while referring to the above classes of contract of
employment, the Supreme Court said: “Learned Justice of Appeal however never adverted to one
clear fact that his first two modes of contract could be terminated against any agreement, such a
dismissal will only be wrongful and could only be compensated in damages.”40 The first two
classes of contract of employment have the same incidents and they are generally described as
32
See ILO Convention 158 of 1982, article 8.
33
Ibid, article 10.
34
Ibid, article 12.
35
See ILO Recommendation 166 of 1982, paragraph 18.
36
Ibid, paragraph 25.
37
See List of Conventions ratified by Nigeria at http://www.iolo.org/normlex
38
See Union Bank of Nigeria Plc v. Ogboh (1991)1 NWLR (Pt. 167) 369, 387-388 [Ogundare JCA]; see
generally, GG Otuturu, “Categories of Contract of Employment: A Note on Union Bank of Nigeria Plc
v. Ogboh” (2005) 9 (1-2) Modern Practice Journal of Finance and Investment Law, 201-213.
39
(1995)1 NWLR (Pt. 380)647
40
Ibid 662 [Belgore JSC]
59
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
ordinary contract of master and servant. Under this class of employment, the master can terminate
the contract with his servant at any time by giving the appropriate notice41 or payment in lieu of
notice.42 Under the Labour Act, either party to a contract of employment may waive his right to
notice or accept payment in lieu of notice.43 Where the contract of employment is terminated in
accordance with the terms of the contract the contract is lawfully terminated and no cause of
action arises. Where the contract is terminated by inadequate notice or without notice or notice
not complying with the terms of the contract, the contract is nevertheless terminated44 and the
only remedy available to the employee is damages, which is limited to the amount which would
have been earned by the plaintiff over the period of notice bearing in mind that it is the duty of
the plaintiff to mitigate the damages which he sustains by the wrongful dismissal.45
In a contract of employment governed by statute or regulations made under statute, the
contract of employment is said to have statutory flavor and the employee enjoys a special status
over and above the ordinary master and servant relationship. In the matter of discipline of such
employee, the procedure laid down by such statute must be fully complied with. If not, any
decision affecting the right or reputation or tenure of office of that employee will be declared null
and void and of no effect whatsoever. A public servant can only be validly removed from service
if the procedure prescribed by law is followed.46
There are three categories of contracts of employment governed by statute or regulations
made under statute. The first category covers civil servants in the pensionable cadre whose
employments are governed by the Civil Service Rules made pursuant to powers conferred on the
Federal Civil Service Commission by virtue of constitutional provisions.47 The Civil Service
Rules invests such civil servants with a legal status beyond the ordinary master and servant
relationship.48 The second category covers public servants whose employments are provided for
in a statute plus service agreements. In such a case, the employer must strictly follow the statutory
procedure for dismissal. Non-compliance with the statutory provisions will render the dismissal
unlawful, null and void.49 The third category covers company secretaries in public companies
whose employments are governed by the Companies and Allied Matters Act.50 In such a case, the
employer must strictly follow the procedure prescribed in the Act. Non-compliance with the
statutory provisions will render the dismissal unlawful, null and void.51
As a general rule, the relationship of employer and employee does not give rise to the
application of the rules of natural justice. A fortiori, there is no principle of law that an employee
must be given fair hearing before his employment can be terminated. National justice can only
be invoked in a contract of employment where the circumstances make the observance of the
rules of natural justice imperative. This position was emphatically stated in Udemah v. Nigerian
Coal Corporation52 where the Court of Appeal said:
41
See Labour Act Cap LI, Laws of the Federation of Nigeria 2004, s. 11(1), which prescribes minimum
notice periods and requires any notice of termination for a period of one week or more to be in writing.
42
See Chukwumah v. SPDC (Nig.) Ltd (1993)1 NWLR (Pt. 289)512, 571 [Olatawura JSC]
43
See Labour Act, s. 11(6)
44
Ifeta v. SPDC (Nig.) Ltd (2001) 11 NWLR (Pt. 724) 472, 490 [Rowland JCA]
45
Evans Brothers (Nig) Pub Ltd v. Falaiye (2003) 13 NWLR (Pt. 838) 564, 591 [per Akintan JCA]
46
Iderima v. Rivers State Civil Service Commission (2005)16 NWLR (Pt. 951)378, 414 [Ogundare JSC]
47
See Constitution of the Federal Republic of Nigeria 1963, s. 160; Constitution of the Federal Republic
of Nigeria 1979, s. 156; Constitution of the Federal of Nigeria 1999; s. 170 respectively.
48
Shitta-Bey v. Federal Civil Service Commission (1981) SC 40
49
Olaniyan v. University of Lagos (1985)2 NWLR (Pt.9) 599
50
See Cap C20, Laws of the Federation of Nigeria 2004, s. 296
51
See Ezekwere v. Golden Guinea Breweries Ltd (2000)8 NWLR (Pt. 670)648, 660 [Ikongbeh JCA]
52
(1991)3 NWLR (Pt. 190) 477
60
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
“When a valid and lawful contract has been entered between two
parties, there can be no room for invoking or inviting natural
justice to intervene if there are no particular rules or regulations
in support of that course; or if there are no special occasions
making a hearing or, indeed, the observance of natural justice
imperative.”53
What this implies is that if a public servant fails to satisfy these four requirements, he
will be placed in the same position as a mere servant in a simple case of master and servant.
Obviously, this is not the intendment of section 36 of the Constitution of the Federal Republic of
Nigeria 1999 (as altered), which enjoins all public authorities to observe the rules of natural
justice in the determination of the civil rights and obligations of every citizen.
In Eche v. State Education Commission59 where teachers in public schools were
summarily dismissed from their respective employment without an opportunity of being heard, it
was held that it offends the rules of natural justice for any public authority to take disciplinary
action against any person without first giving that person an opportunity of being heard. Araka
CJ stated that “when they (the State Education Commission and the Local Government Service
Commission) started to impose punishments on these teachers without giving them any hearing
53
Ibid 490 [Uwaifo JCA]; see generally OVC Okene, “Natural Justice and Contract of Employment”
(2002) 6 (1-2) Modern Practice Journal of Finance and Investment Law 178
54
See Uvieghara, EE Labour Law in Nigeria (Ikeja: Malthouse Press Ltd 2001) 90
55
(2002)1 NWLR (Pt. 947)715
56
Ibid 725 [Ikongbeh JCA]
57
(2003)2 NWLR (Pt. 805) 582
58
Ibid 642 [Uwaifo JSC]
59
(1983)1 FNR 386
61
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
they did in fact infringe the rules of natural justice, and the teachers are entitled to go to Court for
redress.”60 His lordship referred to the English case of Malloch v. Aberdeen Corporation61 where
Lord Wilberforce said:
It is submitted that the right to fair hearing is an elementary right expressly conferred on
every employee of a public authority by section 36 of the Constitution of the Federal Republic of
Nigeria 1999. It is not subject to the agreement of the parties to a contract of employment. On
the contrary, all contractual rights and obligations of public authorities are subject to the
constitutional provision. When the dismissal of a public servant is concerned, therefore, the courts
have two responsibilities to enquire:
• whether the procedural requirements prescribed by any statute have been complied with
• Whether the dismissal or disciplinary action taken against the employee violates the rules of
natural justice?
In ordinary master and servant relationship, where the contract of employment is not
governed by statute or rules or regulations made under statute, an employer can terminate his
employee’s contract of service at any time and he is not obliged to give any reason for so doing.63
In this class of cases, an officer’s appointment can lawfully be terminated without first telling
him what is alleged against him and hearing his defence or explanation. Similarly, an officer in
this class can lawfully be dismissed without observing the principles of natural justice.64
Where the employer gives a specific misconduct as the reason for the dismissal of an
employee, the dismissal cannot be justified in the absence of adequate opportunity afforded to
the employee to explain, justify or else defend the alleged misconduct.65 In other words, the rules
of natural justice would apply in ordinary contracts of service where there is an allegation of
misconduct which may result in some form of punishment, deprivation of some right or loss of
means of livelihood to the employee.66
In practice, however, employers simply inform their employees that their services are no
longer required. Even if the dismissal is motivated by misconduct on the part of the employee,
the employer may choose to be completely silent about the reasons for the dismissal. Thus, in
Olarewaju v. Afribank Plc (supra) the appellant was queried in writing and he answered. He
subsequently appeared before the Senior Staff Disciplinary Committee of the respondent. Based
on the report of the Committee, he was suspended on some allegations of fraud, embezzlement
of money and sundry allegations. He was later dismissed for operational banking malpractices,
dishonest practices and fraud committed by him. However, the letter of dismissal which was
tendered in evidence as Exhibit D did not contain any reason for the dismissal of the appellant.
Accordingly, Katsina-Alu JSC, who read the leading judgment of the Supreme Court, said:
60
Ibid 409 [Parentheses supplied]
61
(1971)2 All ER 1278
62
Ibid 1296 [Parentheses supplied]
63
See Registered Trustees of Planned Parenthood Federation of Nigeria v. Shogbola (2004)11 NWLR
(Pt. 883) 1, 15 [Chukwuma-Eneh JCA]
64
See Olarewaju v. Afribank Nigeria Plc (2001)13 NWLR (Pt. 731)691, 705 [Katsina-Alu JSC]
65
See Yusuf v. Union Bank of Nigeria Ltd (1996) 6 NWLR (Pt. 457) 632, 645 [Wali JSC]; Osagie v. New
Nigeria Bank Plc (2005) 3 NWLR (Pt. 913) 513, 534 [Augie JCA]
66
See Olatunbosun v. NISER (1988) 3 NWLR (Pt. 80) 25, 52 [Oputa JSC]
62
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
It is submitted that the practice whereby an employee without giving any reason to justify
the dismissal falls short of international best practice in labour. It is also a violation of all things
fair and just. This inevitably brings us to the issue of relevance of motive in the determination of
a contract of employment.
It is a well-established principle of the common law, and of Nigerian law, that ordinarily
a master is entitled to dismiss his servant from his employment for good or for bad reasons or for
no reason at all. This is based on the common law principle of sanctity of contract.68 Thus, once
due notice has been given to the employee, the motive which propels the employer to terminate
the employment is generally not relevant.69 In Fakuade v. Obafemi Awolowo University Teaching
Hospital Management Board70 the appellant was employed in 1976. The letter of appointment
stated that the appellant or the respondent may terminate the appointment by a month’s notice in
writing or by payment of one month’s salary in lieu of notice. By a letter dated 25th November
1987, the respondent terminated that appellant’s appointment. The letter did not state any reason
for the termination. It was held that the termination was in accordance with the appellant’s
contract of service. Kutigi, JSC restated the law as follows:
It has been argued that the availability to the employer of the right to terminate the
contract of employment with due notice, regardless of motive, poses the danger of job insecurity
on the art of the employee. This is because the right can freely be used by the employer to reduce
the employee to a mere tool of the trade that could be dispensed with at will.72 However, with the
enhanced jurisdiction of the National Industrial Court to apply international best practices in
labour,73 this is no longer the position. In Petroleum and Natural Gas Senior Staff Association of
Nigeria v Schlumberger Anadrill Nigeria Ltd74 the respondent argued that it has the right to
terminate the employment of any of its employees for any reason or for no reason at all. The
National Industrial Court set the pace for the new stance as follows:
67
Supra 716
68
See above (n 42) 560
69
See above (n 42) 558; see also Taiwo v. Kingsway Stores Ltd (1950) 19 NLR 122, 123 [SC]
70
(1993)5 NWLR (Pt. 291) 47
71
Ibid 58
72
See INE Worugji, Introduction to Individual Employment Law in Nigeria (Calabar: Adorable Press
1999) 654; SI Erugo, Introduction to Nigerian Labour Law (Lagos: Nikky Communication 1998) 86;
INE Worugji, “Termination of Contract of Employment under Nigerian Law” (1993) 3 MILBQ 18, 20.
73
See National Industrial Court Act 2006, s. 7(6).
74
Suit No. NIC/9/2004 decided September 18, 2007.
63
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
While we do not have any problem with this at all, the point may
be made that globally it is no longer fashionable in industrial
relations law and practice to terminate an employment
relationship without adducing any reason for such termination.75
It has been stated, quite correctly, that the National Industrial Court is beginning to do
for the private sector what the Supreme Court did in the 1980s for the public sector, which
changed the face of individual employment law in Nigeria. “It is a welcome development and it
takes us back to 1981 and 1985, the two landmark years in the development of individual
employment law jurisprudence.”78
Under Nigerian law, consistent with the common law, specific performance or
reinstatement is generally not the remedy in respect of a contract of service. Special
circumstances will be required before such a declaration is made and its making will usually be
in the discretion of the court. Several decisions of the Supreme Court dealing with this state of
the law include Olaniyan v. University of Lagos (supra); Shitta-bey v. Federal Public Service
Commission (supra) and Ewarami v. African Continental Bank Ltd.79 Such special circumstances
have been held to arise where the contract of employment has a statutory flavour thus putting it
over and above the ordinary master and servant relationship.80
In Murphy Shipping & commercial Services Ltd v. Maritime Workers Union of Nigeria81
one of the issues for determination was whether the court should set aside the termination of Mr.
Oluwashog Adebisi and reinstate him in the claimant company without loss of salaries and
positions? The Honourable Justice Obaseki-Osaghae said:
75
Quoted in Agomo, CK Nigerian Employment and Labour Relations Law and Practice (Lagos: Concept
Publications Ltd, 2011) pp. 165-166.
76
(2012) 28 NLLR (Pt.81) 441, 479 [Justice Adejumo]
77
Ibid 478-479
78
See Agomo (n 75) 170. The references to 1981 and 1985 are to the decisions of the Supreme Court in
Shitta-Bey v. Federal Civil Service Commission (1981)1 SC 40 (for civil servants) and Olaniyan v.
University of Lagos (1985)2 NWLR (Pt. 9) 599 (for public servants).
79
(1978) 4 SC 99
80
Ifeta v. Shell Petroleum Dev. Co. (Nig) Ltd (2006)8 NWLR (Pt. 983)585, 606-607 [Mohammed JSC]
81
(2012) 26 NNLR (Pt. 75) 385 [NIC]
64
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
The law is it presently stands is that the remedy of reinstatement or specific performance
is possible in a contract of employment in only two instances. These are in cases where the
employment has statutory flavour and where the employment was terminated as a result of trade
union activities. This position was restated by the National Industrial Court in Mix and Bake
Flour Mill Industries Ltd v. NUFBTE83 where Justice Adejumo said:
In the instant case, however, the court did not order reinstatement essentially because of
the time lapse and more importantly because of the alternative prayer of the respondent. In
appropriate cases, the court had ordered reinstatement. Thus, in Rubber Research Institute of
Nigeria v. SSAITHRIANI (supra) where Mr. Eugene Okoduwa, a trade union representative, was
wrongfully dismissed from employment, the National Industrial Court ordered his reinstatement
in the following terms: “We hold that the dismissal of Mr. Okoduwa is wrongful, null and void.
We hereby order that Mr. Okoduwa be reinstated to his employment and his salary arrears be
paid to him right from when he wrongfully dismissed till date without any loss of seniority.”85
In the United Kingdom, the concept of unfair dismissal was introduced as part of the
Industrial Relations Act 1971 as a result of ILO Recommendation 119 of 1963. The relevant
provisions of the Act were re-enacted in the Trade Union and Labour Relations Act 1974 which
was replaced by the Trade Union and Labour Relations (Consolidation) Act 1992. The present
law relating to unfair dismissal is to be found in the Employment Rights Act 1996 as amended by
the Employment Act 2002.86 The Act stipulates that “An employer has the right not to be unfairly
dismissed by his employer.”87 Under the Act, “dismissal” includes termination by the employer
with or without notice, failure by the employer to renew a fixed-term employment and summary
dismissal.88
The Act identifies only six potentially fair reasons for dismissal, which are (a) capability
or qualification; (b) conduct; (c) redundancy; (d) contravention of a statute; (e) retirement; and
82
Ibid 409 A-B
83
(2004) 1 NLLR (Pt.2) 247 [NIC]
84
Ibid 281-282; the Trade Dispute Act 1990, s. 42 is now Trade Disputes Act, Cap T8, Laws of the
Federation of Nigeria, 2004, s. 43
85
Supra 482 [Kanyip JP]
86
The Employment Act 2002 (as amended) s. 98; the Employment Rights Act 1996, s.98A and introduced
a statutory dismissal and disciplinary procedure to ensure procedural fairness.
87
See Employment Rights Act 1996, s. 94.
88
Ibid, s. 95(1).
65
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
(f) some other substantial reason. An employee who considers that he has been unfairly dismissed
can complain about the dismissal to an industrial tribunal which will determine whether the
employer acted reasonably in the circumstances in taking the decision to dismiss.89
If the tribunal finds that an employee has been unfairly dismissed, it may order one of
three remedies: reinstatement, re-engagement or compensation.90 An order of reinstatement is
defined as an order that the employer shall treat the complainant in all respects as if he had not
been dismissed.91 An order of re-engagement is defined as the terms of which the tribunal may
discretionally decide that the complainant be engaged by the employer, or by a successor of the
employer or by associated employer, in employment comparable to that from which he was
dismissed or other suitable employment.92
Reinstatement may be distinguished from re-engagement in two respects. Reinstatement
is retroactive in effect. It involves a revocation of the dismissal and payment of wages for the
intervening period. Re-engagement leaves the dismissal unaffected and an intervening period of
unemployment.93 Again, reinstatement is a return to the same job as if not dismissed, while re-
engagement is a return to a comparable job with the employer or his successor or an associated
employer. The statute gives formal priority to reinstatement and re-engagement. It is where
reinstatement or re-engagement is not possible that the court will order compensation, which is
index linked and is raised annually.94 The compensation is assessed, like redundancy pay,
according to complex provisions, primarily based on the employee’s age, length of employment,
and weekly wage but subject to additional award for expenses and loss incurred and for
discriminatory failure to obey a reinstatement order. An average award for a senior employee
may amount to something between one year and two years’ pay.95
The Transfer of Undertaking (Protection of Employment) Regulations 2006 now give
effect to the Acquired Rights Directives 200196 the aim of which is to ensure that on the transfer
of an undertaking the contractual rights of the employees are maintained. In particular, Regulation
4 states that the “transfer shall not operate as to terminate the contract of employment of any
person employed by the transfer.” Thus the contracts of employment of all employees are
automatically transferred to the transferee on the same terms and conditions as were previously
enjoyed by the employees.
If an employee objects to his contract being transferred he is entitled to refuse, but the
effect of this is to terminate the contract of employment without a dismissal taking place.
Regulation 5 allows the employer to agree to vary such contracts of employment if the sole reason
for such variation is “an economic, technical or organizational reason entailing changes in the
workforce.”
In South Africa, the right not to be unfairly dismissed is recognized as a basic right under
the Labour Relations Act 1995 as amended by the Labour Relations Amendment Act 2002. The
Act protects employees against dismissal without substantive grounds and in a procedurally
arbitrary manner. It provides that “Every employee has the right not to be unfairly dismissed.”97
In NUMSA v. Henred Fruehauf Trailers (Pty) Ltd98 the Appeal Court summed up this principle
in the following terms:
89
Ibid, s. 98.
90
Ibid, s. 111
91
Ibid, s. 114
92
Ibid, s. 115
93
See Morris v. Gestetner Ltd (1973) ICR 587, 592; see generally RW Rideout, Principles of Labour Law
(2ed, London: Sweet & Maxwell 1976) 139-141
94
See Employment Relations Act 1999, ss. 33-34.
95
See Wade (n 19) 72
96
EC Council Directive 2001/123/EC
97
See Labour Relations Act 1995, s. 195.
98
(1994) ILJ 1257
66
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
One major innovation in the Act is the definition of employee as “any person, excluding
an independent contractor, who works for another person” and “any other person who in any
manner assists in carrying on or conducting the business of an employer.”100 This has been held
to include casual employees and temporary employees who are not employed on a permanent
basis or are still on probation.101 The Act prescribes both substantives and procedural fairness for
any dismissal of an employee to be valid. A dismissal is unfair if it is not done for a fair reason
and in accordance with a fair procedure, even if it complies with and notice period in a contract
of employment or in legislation governing employment. The Act recognizes three grounds on
which a termination of employment might be legitimate. These are: the conduct of the employee,
the capacity of the employee, and the operational requirement of the employer’s business.102
Normally, the employer should conduct an investigation to determine whether there are
grounds for dismissal. The employer should notify the employee of the allegations and the
employee should be allowed the opportunity to state a case in response to the allegations. After
the enquiry, the employer should communicate the decision taken to the employee.103
One major challenge facing workers in Nigeria is overdependence on the rules of the
common law by the courts especially in matters of discipline and dismissal of workers. As clearly
illustrated in the case of Idoniboye-Obu v. NNPC (supra), the courts have slavishly followed the
common law doctrine of sanctity of contract to the extent that contractual rights and obligations
are elevated above the clear provisions of section 36 the Constitution of the Federal Republic of
Nigeria 1999 (as altered) requiring all public authorities to observe the rules of natural justice in
the determination of the civil rights and obligations of every citizen. The civil rights and
obligations of a citizen include his contractual rights and obligations.
Another major challenge facing workers in Nigeria is the inadequacy of employment
protection laws. In fact, the provisions according protection to trade unionists under the Labour
Act104 are themselves discriminatory as they seek to protect only a small percentage of workers
at the expense of the generality of workers. The provisions for redundancy under the Labour Act
are also inadequate. It is clear from section 20(1) of the Act that the only right conferred on a
trade union is merely a right to be informed by an employer of a redundancy in his establishment.
No sanction is provided for failure by an employer to do so. The section does not confer a right
to sue in default of an employer notifying the trade union of a redundancy.105
A further challenge facing workers in Nigeria is the non-ratification of ILO Convention
158 of 1982. In view of the provisions of sections 12(1) and 25C (1)(f) of the Constitution of the
Federal Republic of Nigeria 1999 (as altered), it is doubtful whether the jurisdiction of the
National Industrial Court to apply international best practices in labour is of any practical
99
Ibid 1263
100
See Labour Relations Act 1995, s. 213.
101
See Radebe v. Keeley Forwarding (Pty) Ltd (1988) ILJ 505; see generally, SR Jaarsveld and BPS Eck,
Principles of Labour Law (Durban: Butterworths, 1998) p. 282.
102
See Schedule 8 of the Code of Good Practice on Dismissal made in pursuance of section 203 of the
Labour Relations Act 1995, paragraph 2.
103
Ibid paragraph 4.
104
See Cap L1, Laws of the Federation of Nigeria, 2004, s. 7(6).
105
See National Union of Hotels and Personal Services Workers v. Imo Concorde Hotel Ltd (1994)1
NWLR (Pt.320) 306, 322 [Edozie JCA.]
67
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
usefulness. These constitutional provisions are reinforced by the decision of the Supreme Court
in Fawehinmi v. Abacha106 to the effect that in so far as an ILO convention has not been enacted
into law by the National Assembly, it has no force of law in Nigeria and it cannot possibly
apply.107 Will the jurisdiction of the National Industrial Court to apply international best practices
in labour obviate the need for ratification and domestication of international conventions and
treaties in Nigeria?
The common law doctrine of employment-at-will, which gave the employer power to
terminate the employment of his servant at will, has undergone many changes. These changes
have taken place both at the international and national levels through legislations designed
specially to protect workers against arbitrary termination and unjustified dismissal by the
employer. However, Nigeria is not moving with the world. The courts have continued to rely
heavily on the common law doctrine of employment-at-will. Apart from the protection accorded
to civil servants,108 trade union activists109 and university lecturer,110 there is no special
employment protection legislation in Nigeria. This state of affairs is caused largely by Nigeria’s
non-ratification of the ILO Convention 158 of 1982. It is against this backdrop that a number of
recommendations have become imperative for the protection of workers against arbitrary
termination and unjustified dismissal from employment in Nigeria.
Once it is proved that the employer is a public authority established by law, the
employment should be made subject to section 36 of the Constitution (as altered), which enjoins
every public authority to observe the rules of natural justice in the determination of the civil rights
and obligations of those affected by its decisions. This is because, as we have seen, the right to
fair hearing is an elementary right expressly conferred on every employee of a public authority
by section 36 of the Constitution (as altered). Contractual rights and obligations cannot be
elevated above the clear provisions of the Constitution (as altered).
The National Industrial Court should insist on the requirements of substantive and
procedural fairness for termination of employment as part of its jurisdiction to apply the
provisions of Chapter IV of the Constitution of the Federal Republic of Nigeria 1999 (as
altered)111 and international best practices in labour.112 Accordingly, the court should be prepared
to invalidate any termination by an employer which is not done for a fair reason and in accordance
with a fair procedure, even if it complies with any notice period in a contract of employment or
in legislation governing employment.
The National Industrial Court should also be prepared to order injunction and
reinstatement in appropriate circumstances. In this regard, whenever there is breach of procedural
fairness, the employer should be restrained until there is compliance with the requirements of
procedural fairness.113 On the other hand, whenever there is breach of substantive fairness, the
employee should be reinstated.114 After all, the rule that the court will not impose a willing
employee on an unwilling employer was based on the early forms of employer-employee
relationship based on personal pride and feelings. In the modern employer-employee relationship,
106
(2000)6 NWLR (Pt. 660) 228
107
Ibid 228-229 [Ogundare JSC]; see also MHWUN v. Minister of Employment and Productivity (2005)
17 NWLR (Pt. 953) 120, 155-156 [Muntaka-Coomassie JCA]
108
See Iderima v. Rivers State Civil Service Commission (2002) 1 NWLR (Pt.749) 715, 725 [Ikongbeh
JCA]
109
See Mix & Bake Flour Mill Industries Ltd v. NUFBTE (2004) 1 NLLR (Pt. 2) 247, 281-282
110
See Olaniyan v. University of Lagos (1985) 2 NWLR (Pt. 9) 599, 654 [Aniagolu JSC]
111
See Constitution of the Federal Republic of Nigeria 1999 (as altered), s. 254(C)(1)(d).
112
Ibid, s. 254(C)(1)(f); National Industrial Court Act 2006, s. 7(6)
113
See Hill v. C. A. Parsons & Co. Ltd (1971) 3 All ER 1347
114
See McClelland v. Northern Ireland Health Board (1957) 2 All ER 129
68
OTUTURU, Gogo George (LLM) AJLC 7 (1) 2017 pp. 54-69
however, where most of the employers are impersonal organizations such as public companies
and multinational corporations, personal pride and feelings do not have any role to play. These
large corporations and their boards do not have personal contracts with their employees. The rule
is, therefore, no longer suitable for the modern corporation.
Organized labour should put pressure on the Federal Government to ratify ILO
Convention 158 of 1982. In this regard, the Nigerian Labour Congress (NLC) and the Trade
Union Congress of Nigeria (TUC) should set up a Joint Committee on the Implementation of ILO
Conventions and Recommendations. The Committee should be charged with the responsibility
for identifying ILO conventions for the protection of workers, which Nigeria has not ratified or
implemented through legislation; employing acceptable forms of pressure on the Federal
Government to ratify same; allaying the fears of employers by interfacing with the Nigeria
Employers Consultative Association (NECA); and lobbying the National Assembly to initiate a
special legislation on unfair dismissal in line with international labour standards.
In the meantime, trade unions should embody and implement the broad principles of
substantive and procedural faimess in Convention 158 and Recommendation 166 of 1982 in
collective agreements and seek to enforce any breach through the Industrial Arbitration Panel and
the National Industrial Court. This is consistent with the methods of implementation of the ILO
Convention115 and Recommendation116 concerning the termination of employment at the
initiative of the employer. It is also consistent with the interpretative jurisdiction117 and the
appellate jurisdiction118 of the National Industrial Court.
© 2010-2017
Sacha & Diamond Academic Publishers, Meridian Centre,
258 Kingsland Road, Hackney, London E8 4DG, England, United Kingdom.
In Compliance with the Standards Approved by the UK Arts and Humanities Research Council
Abstracting and Indexing in:
GIGA - The Electronic Journals Library of the German Institute of Global and Area
Studies, Information Centre, Hamburg; Google Scholar; Global Development Network
(GDNet); Social Science Research Network (SSRN); Econlit - The American Economic
Association's Index; EBSCO; IndexCopernicus USA; British International Libraries;
Anton’s Weekly Digest;
Econlit (USA); International Abstracts in Operations Research; Environmental Science
and Pollution Management; Research Alert
For the Advancement of Knowledge to the World. www.sachajournals.com
115
See ILO Convention 158 of 1982, article 1.
116
See ILO Recommendation 166 of 1982, paragraph 1.
117
See National Industrial Court Act 2006, s. 7(c)(i); and Constitution of the Federal Republic of Nigeria
1999 (as altered), s. 254(C)(1)(j)(i).
118
Ibid, s. 7(4); Constitution of the Federal Republic of Nigeria 1999 (as altered), s. 254(C)(1)(1)(ii).
69