By Elton Chizindu Mpi,Esq
What the employer needs to know
In law, an employer has the power to exercise disciplinary action over his employee. Such disciplinary powers include suspension, interdiction, termination or dismissal. The power of an employer to discipline his employee cannot therefore be taken away by the Court. It is therefore trite that, he who hires can also fire. However, in the exercise of such power to discipline such employee, an employer must observe and adhere to the terms and conditions under which he entered into the contract of employment or hired the employee. Where the employer determines the employment of an employee in breach of such terms and conditions, the employer is ipso facto liable for unlawful termination of the services of the employee. It is very common for employees to sue their employers for wrongful termination of employment and claiming damages. This often occurs as a result of the fact that the employers did not comply with legal provisions as to the apt mode of firing an employee. As an employer, whenever you decide to make a company decision to terminate the employment of an employee, you should be aware that the employee may file a claim or attempt to sue you for wrongful termination of employment.
This post is for employers to learn the right way of dismissing or terminating the employment of an employee.
There are various ways an employer can avoid lawsuits on wrongful termination of employment by an employee which would be discussed here under. The following must be taken into consideration before an employer dismisses an employee.
1.Complying with Contracts of employment:
Every employer should provide for contracts of employment as this is in line with the provisions of the Labour Act Cap L1 LFN 2004.
It is trite that where the contract of employment itself provides a procedure for the termination of the employment, the procedure as provided must be complied with to effectively bring the employment to an end. An employer who terminates the contract with his employee in a manner not envisaged by the contract will be liable for damages for the breach of the contract and that is the employee’s only remedy. One of the ways an employer can avoid litigations based on wrongful termination of employment is to adhere to the provisions stipulated in the contract of employment. The employer should review the contract of employment from time to time in other to have an insight on what it provides and the duration of employment of the employee.
Section 7 of the Labour Act expressly provides for contract of employment.
Section 7. (1) provides that “Not later than three months after the beginning of a worker’s period of employment with an employer, the employer shall give to the worker a written statement specifying-
(a) the name of the employer or group of employers, and where appropriate, of the undertaking by which the worker is employed;
(b) the name and address of the worker and the place and date of his engagement;
(c) the nature of the employment;
(d) if the contract is for a fixed term, the date when the contract expires;
(e) the appropriate period of notice to be given by the party wishing to terminate the contract, due regard being had to section 11 of this Act;
(f) the rates of wages and method of calculation thereof and the manner and periodicity of payment of wages;
(g) any terms and conditions relating to-
(i) hours of work, or
(ii) holidays and holiday pay, or
(iii) incapacity for work due to sickness or injury, including any provisions for sick pay; and
(h) any special conditions of the contract.
2.Providing terms and conditions of employment
I emphasize again that he who hires can fire. It nevertheless remains the law that an employer must observe and adhere to the conditions under which the employee is hired before such an employee can be fired otherwise the employer can ipso facto be held liable for unlawful termination of the services of the employee. So many cases have given credence to this principle of law. See Garuba v. Kwara Investment Co. Ltd (2005) 5 NWLR (pt.917) 160; Osisanya v. Afribank (Nig.) Plc (2007) 6 NWLR (pt.1031) 565
As an employer terms and conditions of employment must be taken into consideration. Any action taken by the employer must be in line with the terms of the contract. As an advice, If you make the decision to terminate an employee, it should not be a great surprise for the employee.
3.Draw up disciplinary procedures and fair hearing-
In most cases, employers and employees have the responsibility of drawing up disciplinary procedures which shall ensure that the employee has enjoyed the Constitutional Right to fair hearing before any action which
could lead to the determination of his employment is resorted to by the employer. Where there is a serious allegation against an employee such as a serious misconduct or fraud, such an employee should be given the right to fair hearing to tell his own side of the story. The employer must also ensure that the disciplinary procedures are not against the rule of natural justice, equity and good conscience. Accordingly, it is pertinent to note that where the disciplinary procedure is incorporated into a contract of employment, failure to follow that procedure may give rise to an action for breach of contract against the employer.
4.Adhering to statutory notices
An employee whose employment has been terminated without been given the requisite statutory notice stipulated in the Labour Act or in the contract of service with due regard to the provisions of the Labour Act may sue to claim for special damages to the extent of the one month salary in lieu of notice.
Every employer should make provision for the notice to be given before termination of employment of an employee.
Section 11. (1) of The Act provides that “Either party to a contract of employment may terminate the contract on the expiration of notice given by him to the other party of his intention to do so.
(2) The notice to be given for the purposes of subsection (1) of this section shall be-
(a) one day, where the contract has continued for a period of three months or less;
(b) one week, where the contract has continued for more than three months but less than two years;
(c) two weeks, where the contract has continued for a period of two years but less than five years; and
(d) one month, where the contract has continued for five years or more.
5. Payment of salary in lieu of notice
Payment of salary in lieu of notice is money paid by an employer to an employee to end the employee’s work instead of giving notice.
The general rule is that Nigerian employers are entitled to terminate a contract of employment at any time and without stating the reason or cause for doing so, provided that the appropriate notice of termination is given to the employee or the employee is paid a salary in lieu of such notice.
For example, if an employee has a three month notice period, the employer might decide that they want today to be the last day of your employment – but they will be paying your wages in lieu of this notice for three months, even though you are not physically coming in to work any more.
In Conclusion, as an employer that wishes to avoid floodgates of litigation on wrongful termination of employment, the guidelines above should be followed strictu sensu. It makes more sense to exercise the power to hire and fire without having to go through the hassle of litigation which of course would cost time and money. Therefore, it is expedient to terminate the employment of an employee the right way.
Ace Juris 