Wrongful Termination Of Contracts Of Employment In Nigeria; A Case For Reinstatement Of Private Employees

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Wrongful Termination Of Contracts Of Employment In Nigeria; A Case For Reinstatement Of Private Employees

Table of Contents

  • Title page
  • Approval page
  • Dedication
  • Acknowledgement
  • Abstract
  • Table of Contents
  • Table of Cases
  • Table of Statutes
  • Abbreviations

Chapter One:

Contracts of Employment: Meaning and Nature

  • 1.1 Introduction
  • 1.2 Meaning and Nature of Contract of Employment
  • 1.2.1 Offer and Acceptance
  • 1.2.2 Consideration
  • 1.2.3 Intention to Create legal relation
  • 1.2.4 Capacity
  • 1.3 Parties to a Contract of Employment
  • 1.3.1 Employer
  • 1.3.2 Employee
  • 1.4 Independent Contractor
  • 1.5 Why an Employee needs Protection
  • 1.6 Conclusion

Chapter Two:

Termination of Contract of Public Employment

  • 2.1 Introduction
  • 2.2 Under Public Employment
  • 2.3 Different methods of Termination of Contract of Employment
  • 2.3.1 Termination by Operation of Law
  • 2.3.2 Termination by Intention of Parties
  • 2.3.3 Summary Dismissal
  • 2.3.4 Conclusion

Chapter Three:

Wrongful Termination of Contract of Private Employment

  • 3.1 Introduction
  • 3.2 Wrongful Termination of Contract of Private Employment
  • 3.2.1 Lack of Just Cause
  • 3.2.2 Wrong Procedure
  • 3.2.3 Lack of Proper Notice
  • 3.2.4 Breach of the Rules of Natural Justice
  • 3.2.5 Conclusion

Chapter Four:


  • 4.1 Introduction
  • 4.2 Reinstatement
  • 4.3 Conclusion

Chapter Five:

Observations, Suggestions and Conclusion

  • 5.1 Introduction
  • 5.2 Observation and suggestions
  • 5.3 Conclusion
  • Bibliography

Chapter One

Contracts Of Employment; Meaning and Nature

1.1 Introduction

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.

1.2 Meaning and Nature

The nature of contract of employment is the relationship between an employer and his employee comes into existence as a result of a contract between them generally referred to a contract of service, which means any agreement whether oral or written, expressed or implied, where by one person agrees to employ another as a worker and that other person agrees to serve the employer as a worker as contained in Labour Act
Generally, the contract of employment is an off-shoot of our general law of contract where the essential ingredients of the contract must be found present before it’s enforceability.

1.2.1 Offer and Acceptance

In every contract of an employment, there is a meeting of the minds of the parties before the enforceability of the contract. That is to say, an offer must be made by one party called (offeror) as in Callil v. Carbolic Smoke Ball Co. and the acceptance of the offer by the other party called (offeree) as in the case of Afolabi v. Polymera Ind. Nig. Ltd. This principle of offer and acceptance entails freedom of both parties to offer and accept unconditionally the terms of employment.

1.2.2 Consideration

In a contract of employment, where there is an offer and acceptance by both parties to the contract of services, there must be a consideration to furnished the contract, describing some rights, interest, profit or benefit occurring to one party or some fore-bearance detriment, loss or responsibility given, suffered or undertaking by the other. The above explanation was illustrated in the case of Currie v. Misa Therefore, consideration in the contract of employment is the salary and other fringe benefits which an employee earns on one part and services which an employer receives on the other part.

1.2.3 Intention to create Legal Relation

The relationship between an employer and employee is established by contract. Where both parties agreed on the terms of the contract of employment, creating a common intention of both parties to enter into a legal obligation that is contained in the employment agreement Rose and Frank v. Crompton

1.2.4 Capacity

The law is settled that parties to a contract of employment must possess the capacity of contract as recognized by law at common law. Certain categories of persons namely; infants, mentally infirm and disordered person and drunkards in certain circumstance are incapable of entering into a contract. This has been specified in our statute Nigeria Labour Act 2004.

In the case of an infant, the law forbids to engage a person (child) below the age of sixteen years from entering into any contract of employment except that of an apprenticeship. But the Act provides in Section 19(1) of the Labour Act 2004 that a child under twelve years of age can be employed only by a member of his family and even then, subject to his rights, agricultural, horticultural or domestic work approved by the Minister of Labour as stated in Section 91(1) (a) Labour Act.

However, Section 59 of the Act is an exception apparently to enable a youth receive his education in a technical school. In respect of working on a ship in general, Section 61 (3) of the Act provides that even when the non-adult is allowed to be so employed, he can work only on a vessel in which only members of the same class are employed.
Under Section 59 of the Act, the Minister of Labour has power to notify an employer in writing that the kind of work in which a young person is employed is injurious to his health, immoral or otherwise unsuitable.

Finally on mentally infirm and disordered person are persons who are insane, unsound minds incapable of being conscious and rational thinking on the obligation of the terms of the contract of employment.

1.3 Parties to a Contract of Employment

A contract of employment or services is entered into and enforceable by the employers and the employees, which automatically forms or constitute the major parties to a contract of employment in Nigeria Labour Law.

A person who is in a contract of employment with another cannot be transferred to another employer without his consent. This is in conformity with the provision Section 10 (1) of the Act which provides as follows “The transfer of any contract from one employer to another shall be subject to the consent of the worker and the endorsement of the transfer upon the contract by an authorised labour officer”.

1.3.1 Employer

An employer is the person by whom the employee is or was employed. Rights can only be acquired against the one employed. See the case of Harold Fielding Ltd. v. Mansi

A person who exercises sufficient control over employee may be regarded as being the employer for some purposes as illustrated in the case of Road Transport Industry Training Board v. Ongaro

1.3.2 Employee

According to Section 55 of the Trade Union Act 1974 defines an employee or worker as “any member of the public service of the federation or of a state or any individual (other than a member of any such public service) who has entered into or works under a contract with an employer.

In N.A.L.G.O. v. Bolton Corporation, the House of Lords decided that an employee or worker includes manual labourers, clerks, apprentices, and persons in a contract personally to execute work or labour.

1.4 Independent Contractor

An independent contractor is an employee, employed by an employer to carry out a specific contract in the contract of employment.

According to Salmond in Nigeria Law Reform Act 1961, Section 7 (4) (b), that the liability of the independent contractor is not vicarious. A person is not generally liable for the tort of his independent contractor or the servant of such a contractor committed in the discharge of the contractual obligations.

1.5 Why an Employee Needs Protection?

A contract of employment like any other contract comes into existence by an agreement between the parties (i.e.) the employer and employee.

The agreement must be free and voluntary neither party compels the other to accept any terms or conditions in the agreement.

The vouched freedom and volunteerness of the agreement raised the inequality of bargaining power between the two parties. The number of people applying for work is too much for the number of jobs the employer have. Because of these factors, there is a brake down in the negotiation and the employer continues to negotiation until he gets what he considers favourable terms and conditions for the employment.

Technically, he agrees to the terms and conditions of the contract but in realization of this situation, Professor Adeogun made the following observation in line with the legal framework of Industrial relations in Nigeria thus:
The resumption of equality between two parties tends to ignore other social and economic consideration which may make this equality and its underlying freedom, fictitious and hollow. Indeed, the so-called bargaining power of the individual worker is important in practice, especially in a country like Nigeria where there are more workmen than the jobs available and where the employer can choose freely whom to employ

1.6 Conclusion

In conclusion of this chapter one, relating to contract of employment involving employers and employees relationship where one party made an offer and the other party accepts the offered, brought no doubt in negotiation where there is inequality bargain.

Though it is a vouched freedom and volunteerness of the agreement that places the employee as a beggar without choice irrespective of the terms or conditions of the employment under which he accepted the offered. This is as a result of insufficient of availabilities of jobs in our society (Nigeria).

The situation in Nigeria today as regard employment is such that it is difficult to get an employment and more difficult for wrongfully dismissed employee to secure an alternative employment. Therefore, since the contracts of employment manifest from volunteers consent, which constitute a contract of service between the parties, the law is then in support of the party that is faithful to its bond under the contract and opposed the other that acts contrary to the provisions or contractual terms of the employment.

Chapter Five

Observations, Suggestions and Conclusion

5.1 Introduction

It has been observed that the foregoing chapters pointed out that wrongful termination of a contract of employment is an unjustifiable repudiation of the contract by the employer. It is worthy to note that the Act of one party to end up contractual relationship (unilateral) afford the other party entitlement of remedies. This is supported by various legal protection afforded by the Nigerian law and judicial practices to the employee’s against wrongful dismissal.

Thus, since volunteers of consent is required to constitute a contract of services between the parties the law is then in support of the party that is faithful to its bond under the contract and opposed the other that acts contrary to the contractual terms of the agreement in the contract of employment.

5.2 Observations, Suggestions and Conclusion

In a contract of services where there is a breach of contract of service based on wrongful dismissal from service, there are various remedies to it. However, a closer look at the various remedies provided by the law will reveal that much still has to be done to alleviate the fear of wrongful dismissal from service which is seriously biting hard in all sectors of human endeavour, particular because although the remedies such as reinstatement, injunction, damages etc are available to employee who has put more years than he had put in the employment pending the determination of his case.

In the light of the above and in relation to the various remedies afforded an employee who alleges wrongful dismissal from employment, it is pertinent to also highlight some suggestions for improved protection of the employee from wrongful dismissal from service.

As stated earlier, the law shelters the worker from wrongful dismissal only when the worker maintains loyalty to the contractual term of agreement with the employer. The workers must be aware of the terms in the agreement if he is to abide by them so that where the contract is not evidenced in writing, the employer should deliver the particular to the employee as soon as the commencement of the employment.

Thus, given the background of the Nigerian employees engaged in services not evidenced in writing, it is difficult with respect to agreeing with the requirements of the provision in Section 7 of the Labour Act which states that:
“The employer in a case of a contract in writing is to deliver to the employee particulars of the contract within three months of the commencement of the employment with an employer”.

Those engaged in such contract in Nigeria are basically illiterates and to keep them in suspense for that length of period without informing them of the nature of the contract of their employment is abnormal and unethical. It is however, suggested that for the protection of the illiterate employees whose contract are not endorsed in writing, the particulars of such employment must be made known to those employees in the languages understood by them on the commencement of the employment.

Moreso, another area of concern is the issue of compensating the employee whose appointment is wrongfully terminated. Obviously, the basis of compensation is on the due notice having been properly given. Thus if an employee would have been entitled to one month notice and his appointment had been wrongfully terminated, he will be entitled to damages to the value of one month salary in the event of wrongful termination of employment.
The question then is, will such a person be able to sort out an alternative employment within the said one month given in Nigeria situation? In this regard, the law works injustice in relation to long time employment. For, it is absolutely difficult to agree to any submission that any amount of compensation paid to a long time employee whose appointment has been wrongfully terminated would be adequate to sustain him and his family for the period (which might even be longer than he already put in), he will have to sort an alternative employment in Nigeria today, something more compensatory than this can be done. Thus, the provision in the Labour Act regarding “Termination of contract by notice” in its Section 2 should be amended. For instance, sub-section 2 (d) of that section which provides “one month, where the contract has continued for five years or more”. In so doing, the desired protection of the employee would advice its noble objective given the fact that in Nigeria today, it is absolutely difficult to sort out an employment within six months.

Furthermore, there is need for parties to a contract of employment to comply strictly with the statutory or contractual agreement before terminating the misconduct on the part of an employee, the disciplinary action to be taken depends on the circumstances including the nature and period of the misconduct. It should not be left entirely to the discretion of the employer to determine what is misconduct in the instance. In this regard, it is difficult with respect to appreciate the decision of the court in the case of Oyedele v. LUTH.

That “misconduct is what the employer considers to be misconduct”. Undoubtedly, this decision confers an employer a very wide and dictatorial power to treat and even dismiss his employee in the way and manner he feels right, thus leaving the employee completely unprotected. It is safe to suggest that where an employee is to be dismissed on grounds of misconduct, such misconduct must not be pre-employment misconduct. According to Okagbue J.C.A. in Gwagoh v. Bendel State Hospital Management Board.

A contract of service is not “uberri maefidel” (where the promisee is bound to communicate to the promisor every fact and circumstance which may influence him in deciding to enter into the contract or not) and accordingly, the fact that the servant did not disclose his criminal record does not ipso facto (by the mere fact) vitiate the contract of employment”. It should only be a misconduct that is in the employment after the employer had made available the disciplinary rule, the type of circumstances which can lead to a misconduct and the agreed procedure in determining whether an employee has or has not committed the particular misconduct alleged that should be considered in determining the fate of the employee. Therefore, the operative procedure should be first, an oral warning, or in the case of more serious misconduct, a written warning setting out the circumstances.

More so, no termination of employment for a breach of discipline expects in the case of gross misconduct, that having been expressly defined in the contract of agreement. Furthermore, an arrangement be set up to monitor at regular intervals, developments in employment relationship between the employer and employee especially as regards to termination of appointments.

It is absolutely necessary that increase efforts by both public and private employers should work towards expansion project, so as to create more job opportunities. This will encourage and determine employees who are wrongfully terminated and those rightly terminated from their employment to seek alternative employment.

There should be need to adhere strictly to the principles of fair hearing as provided for in Section 33 of the 1979 and Section 36 of the 1999 constitution of the Federal Republic of Nigeria. This is, in spite of the right of the employer to appoint and terminate at the same time, the employee should be given adequate time and facilities to present his case and should also be given opportunity adequately to be heard in defence of whatever allegation that is levelled against him.

More importantly, one will suggest that the court system in Nigeria be overhauled as to enable the removal of protracted delay in the administration of justice whenever a case is before the court in respect of wrongful dismissal of an employee’s appointment.

The situation in Nigeria today as regard employment is such that it is difficult to get an employment and more difficult for wrongfully dismissed employee to secure an alternative employment. There should be need to recognise that Nigerians in general and the welfare of person in particular depends upon each other. Thus there is need for both employees and employers to be interested on the welfare of one another for a collective sustenance of the Nation’s economy.

5.3 Conclusion

In conclusion of this project work, it is paramount to adhere to the principles governing employer and employee relationship, the remedies and suggestions stated above automatically serve as protections affordable to wrongfully terminated employees and in Nigeria where mobility of labour is difficult, if not impossible, wrongful dismissal cases should be given urgent attention, and in general, there is need for more judicial divisions to be created over the court proceedings as to enable speedy dispensation of justice. Since “justice delayed is justice denied”. By so doing justice will be expatiated and the oppressed parties to a contract of employment will be justified by the provision of the law governing such contract of employment.

It is pertinent to note that while most of the Nigeria labour legislation strives to alleviate the hardship of the average Nigerian worker, there are still need to modify and amend such laws to improve their lots with a view to achieving priority between the parties subject to the terms of employment and termination of it, such as adequate safety devices.

The employer should be provided an insurance against injury for a worker in the cause of his employment. In most cases, the damages awarded are not adequate to such an injured party. This is manifestation of Mobil Oil Nigeria Limited v. Akinfosile, International Drilling Company (Nigeria) Limited v. Ajijala. Where the court noted that where a contract of employment or service is terminable on notice, and the employee whose employment is terminated has not been served with the requisite notice, what the employee could have earned during the period of notice is the requisite damages that the employee is entitled to.

The court should on their own discretion award more damages taken into cognisance of circumstances of each case as was interpreted in Dr. Babatunde Owolabi Sangunuga v. Akinwu Motor and Anor.

Finally, it is very important to promulgate a legislation that will be generally acceptable in the light of the Nigerian – socio-economic realities and whose fashion must be drastically different from that of common law which has obviously outlined its utility.

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