Wrongful termination of employment occurs when either the employer or the employee terminates his employment otherwise than in accordance with the contract or agreement.
In employer and employee relationships just like any other relationship, dispute and differences are bound to arise and where such is not properly managed, this may lead to termination of employment by either party.
CONTRACT OF EMPLOYMENT
A contract of employment is an agreement between two or more persons relationship established by contract, creating an obligation to do a particular thing in a contract of employment. This generally would be regarded as a contract of service, which connotes any agreement whether oral or written, expressed or implied, whereby a party agrees to employ another as an employee and the other party agrees to serve the employer as a worker usually as contained in the LABOUR ACT, CAP L1 LFN (2004).
Going from the above, where there is a contract of employment in place, the court will be guided by such contract particularly the terms and condition of such contract where the issue of wrongful termination or any other right or obligation calls for determination.
However, the position of the law that has been upheld by Nigeria appellate court has always been that an employer can terminate the employment of his employee without giving any reason at all.
By established principles, an employer has the right to terminate an employment without stating any specified reason in so far all laid down procedures are followed in terminating the employment. Where the laid down procedures are not followed especially where there is a contract of employment, such will amount to wrongful termination.
Section 7 of the Labour Act requires that within three (3) month of the engagement of an employee, an employer must give to the employee a written contract of employment which must specify among other things a description of the parties to the contract of employment, the nature of the service(s) to be rendered under the contract, the tenure of the contract, remunerations which must be paid, hours of work, the period of notice to be served before the contract can be terminated, possible grounds for dismissal of the employee etc.
Section 11 of the Act went further to make provision(s) as to termination of contract by notice which includes the time within which to give such notice depending on the duration of the contract. The Section also stipulates that any notice for a period of one week or more shall be in writing. The Section also went further to state that either party to a contract can still waive his right to such notice in any occasion or from accepting a payment in lieu of notice.
LABOUR AND EMPLOYMENT LAW IN NIGERIA
Under the Nigeria legal system, different legislations are responsible for the regulation and administration of employment and labour. The applicable statutes include:
1. The Labour Act
2. Trade Dispute Act
3. Trade Union Act
4. Employee Compensation Act
5. Factories Act
6. Pension Reform Act
7. Housing Act
8. Industrial Training Fund Act
9. National Health Insurance Scheme
10. Immigration Act.
11. National Industrial court Act
12. National Industrial court Rules
The Labour Act however is the principal legislation governing employment relation in Nigeria. Its application extends to employees engaged under a contract of labour or clerical work in both the private and the public sector.
Employees exercising administrative, executive, technical, or professional functions are governed by their respective contract of employment.
The National Industrial Court (NIC) has exclusive jurisdiction in civil and criminal matters relating to or connected with labour, employment, trade unions, industrial relations, the condition of service including health, safety, welfare of labour employee, workers and matters incidental thereto or connected therewith.
The NIC also has jurisdiction to entertain matters connected or relating to Factories Act, Trade Dispute Act, Trade Union Act, Labour Act, Employee Compensation Act, or any other Act or Law relating to labour, employment or industrial relations.
DIFFERENCE BETWEEN TERMINATION AND DISMISSAL
Termination and dismissal have the same effect of bringing a contract of employment to an end. The distinction between the two concepts is discernible from the definition and meaning attached to each. A comparison of the two concepts will depict that:
(i) Termination is a condition attaching to the contract of employment under the law while dismissal is not a condition of contract of employment agreed upon by parties;
(ii) While a contract of employment may be terminated without reason, dismissal usually arises from the employee’s misconduct; reason for dismissal, where it is not stated may be demanded;
(iii) Either party can terminate a contract of employment but only the employer can dismiss;
(iv) A requisite notice must be given before to terminate employment but no notice is required for dismissal;
(v) While laid down procedures and processes must be followed to effect dismissal, no format is required to terminate employment; provided due notice or payment in lieu thereof have been complied with;
(vi) Whereas dismissal may be wrongful on account of breach of procedures, termination could on only be wrongful for failure to give proper notice or payment in lieu of notice;
(vii) Whereas, as in the case of Ajolore v. Kwara state College of Technology and Ors (1996), NMLR, 34, p. 29 and 46, an employer must pay indemnity to his employee for unlawful dismissal, no indemnity is payable for termination
It is evident from the case law that an employee who has been wrongfully dismissed may be entitled to certain reliefs. In Western Development Corporation v. Jimoh Abimbola (1972) ANLR, Pt. 2433 it was held that the measure of damages for wrongful dismissal is prima facie, the amount the plaintiff would have earned had he continue with the employment up till the period of judgement. This is otherwise known as the principle of restitution in integrum.
NIGERIA LABOUR LAW ON RESIGNATION
To terminate the contract by resignation is also one of the means to bring an employment to an end, but at the instance of the employee. In this case the employee is to give one month notice or one month salary in lieu of notice where it is so required. An employee who resigns from his employment cannot bring any action for claims; rather, he may lose some of his entitlements. Rule 020804 (a) of PSR, 2008, specifically provides that an officer who resigns will be liable to:
(i) Forfeit all claims to vacation leave; any vacation leave or all passage privileges granted will be ex-gratia
(ii) Refund to the employer in full any sum of money which he may be owing to the employer or which under any provision or other rules or agreement entered into with the employer, is refundable to the employer for his not discharging the obligation set out in such agreement; provided that any or all of such refunds may be waived by the employer
However, if his resignation is as a result of the employer’s disgusting and unfriendly conduct, he cannot be said to have resigned but rather constructively dismissed. One example of this is where the employee resigned because the employer has treated him unfairly by denying him basic benefits.
REMEDIES FOR WRONGFUL TERMINATION OR DISMISAL IN NIGERIA
Although dismissed officers suffers a lot of handicaps in bringing an action to court to challenge their wrongful termination or dismissal, the court through many decided cases, have proved that a victim who is on the right and firm footing can obtain remedy for wrongful dismissal or termination of employment.
The remedy which an employee that considers that his employment has been wrongfully terminated either, because he was given insufficient notice or by failure to justify his dismissal may seek is any one of the remedies normally available for breach of contract include:
(i) Specific performance
(ii) Fair Hearing
TERMINATION OF PRIVATE EMPLOYMENT
Where the nature of the employment is under a private employment, the remedies available to an employee who has been wrongfully dismissed or terminated from employment include:
Damages: In Western Development Corporation v. Jimoh Abimbola (1972) ANLR, Pt. 2433 it was held that the measure of damages for wrongful dismissal is prima facie, the amount the plaintiff would have earned had he continued with the employment up till the period of judgment.
Damages are awarded to restore the plaintiff as far as money can, to the position he would have been if there had been no breach. In Cameroon Airlines v. Mike E. Otutuizu, the court distinguished two types of damages as follows:
(a) General damages is awarded by the trial court to assuage a loss caused by an act of the adversary; and
(b) Special damage succeeds in a claim where it is specially pleaded, particularized or itemized; it must be claimed specially and proved strictly.
Furthermore, an employee whose employment has been terminated without be given the required and usually 30 days notice that is stipulated in the contract of service may sue to claim for special damages to the extent of the one month salary in lieu of notice.
TERMINATION OF PUBLIC EMPLOYMENT
Specific Performance or Reinstatement: Regarding officer that are wrongfully terminated or dismissed during the course of a public employment or statutory employment, in addition with damages as a remedy that can be claimed for such wrongful dismissal, such officer can still be entitled to specific performance or reinstatement.
The general principle is that specific performance will not be ordered in respect of an obligation to perform personal services. Specific performance in this context will mean restoration or reinstatement of an employee to his former job where the court is persuaded that his employer has wrongly determined the employment. This remedy has normally been granted to persons holding offices in the public service whose employment enjoys statutory backing.
In Olaniyan v. University of Lagos (1985) 2 NWLR (Pt.9) 599 (SC) the court held in its ruling that where the employment of an employee is protected by statute, the employee who is unlawfully dismissed may be reinstated.
An employment which is protected by statute must be terminated in the way and manner prescribed by the relevant statute and any other manner of termination inconsistent with the statute will be null and void and of no effect.
Where the provisions of a statute govern the contract of employment or where the conditions are derived from statutory provisions, it invests the employee with a legal status than the ordinary one of master and servant. See Balogun v. University of Abuja (2002) 13 NWLR (Pt.783) 42 at 53.
Written by Labour and Employment Law Team at Resolution Law Firm, Lagos, Nigeria