Nigeria: Nigeria Employment Law Review

Last Updated: 20 January 2017
Article by Olawale Adebambo, Folabi Kuti and Ifedayo Iroche


Employment law in Nigeria is not founded on the provisions of a single statute. Rather, it is dispersed in different legislation that together provides the framework. While there is an unsettled discussion as to whether the Labour Act (LA) extends beyond unskilled and manual workers, it nonetheless remains the governing law for labour matters.

Nigerian law allows freedom of contract in upholding and binding employers and employees to their agreements. There are also various statutory provisions of which parties must take cognisance when contracting; the laws regulating pensions and tax for instance, are not within the scope of contractual freedom.

Section 20 of the Trade Dispute Act (TDA)1 establishes a specialised court, the National Industrial Court (NICN), with exclusive responsibility for handling employment-related disputes; the Constitution of the Federal Republic of Nigeria 1999, as amended (CFRN)2 further endorses the NICN's authority and jurisdiction. The Industrial Arbitration Panel (IAP) also set up by the TDA is responsible for settling any dispute referred to it by the Minister of Labour and Productivity (the Minister). Any objection to an IAP award is taken before the NICN. Appeals from the NICN lie as of right to the Court of Appeal on questions of fundamental rights contained in Chapter IV of the CFRN in relation to matters under its jurisdiction.3


Sole proprietorship remains attractive to the Nigerian populace in view of the mismatch between the rate of unemployment and availability of paid employment. Statistics reveal that, in terms of the age distribution of owners of such enterprises, 93.3 per cent are aged 36 and above, while the 15–35 age group accounts for 6.67 per cent.4 An analysis of some 5,000 enterprises (4,615 with legal status) in a Report of the Nigerian Social Statistics Report produced by the National Bureau of Statistics in the year to end 2012, show the dominant business structures in Nigeria:5

The 2012 Report also presents a rundown of industrial disputes between 2004 and 2008. In 2004, there were 36 disputes; this increased to 189 in 2006 and almost 300 in 2008. In 2004, 26 of the disputes led to strike actions, compared with 93 in 2008. A total of 127,377 workers were involved in the disputes of 2004 whereas in 2008, 868,907 workers went on strike. Overall, 2.63 million man-days were lost in 2004, compared with 8.97 million in 2008. Community, social and personal services recorded the highest number of disputes at 231,067.6 A number of employment-related disputes relate to trade unions and collective bargaining agreements (CBAs); whether these are a mandatory requirement and their enforcement.


With the mandate given to the NICN to consider and apply best international labour practice when adjudicating on matters within its jurisdictional competence,7 2014 saw a significant number of cases handed down by it highlighting the need for a constant interplay of equity and fair play in the workplace.

i Protection of employees in cases of unfair labour practices

The facts of Mr Shittu Habib v. Coral International Limited8 and Abel Abel v. Trevi Foundation Nigeria Limited9 present interesting examples of the NICN intervening to afford equity to workers injured in the course of their work where the employers, in an apparent bid to avoid liability for compensatory damages, contended that the workers were not under their employment as at the time of the accident. The court, in both cases, noted that even though the claimant did not show any letter of employment, a contract of employment could be properly inferred from the conduct of the parties; in the Abel case, the fact that the claimant had been doing some work for the defendant for which the defendant paid an 'allowance', coupled with the issuance of a work identity card.

The court further invoked its equitable jurisdiction to assist the hapless employee in the Habib case by awarding monetary compensation to enable him obtain surgery to remove metal from his leg.

Also worthy of note is the commendable effort of the NICN at expanding the hitherto seemingly inflexible principles of common law (deeply engrained in the nation's labour jurisprudence) to accommodate far-reaching results for the aggrieved employee. Where it was established that an employer, without just and established cause, impugned the integrity of an employee and based on this impugnment, went ahead to peremptorily terminate his employment,10 the NICN not only condemned the act as an unfair labour practice, but also held that such a detestable practice cannot be adequately compensated by the right to payment of a month's salary in lieu of notice which the wrongfully terminated employee would ordinarily have been entitled. Relying on applicable provisions of the CFRN and the National Industrial Court Act 200611 that enable the Court to award damages as a relief for the unfair labour practice of unfair dismissal and further stating that the Court can take guidance from the more elaborate provisions of foreign statutes as to appropriate remedies when a proof of unfair dismissal is established, the court awarded the claimant five months' salary as general damages, in addition to one month's salary in lieu of notice.

In The Registered Trustees of Union Bank & Anor v. Union Bank Of Nigeria &Ors,12 the court held that as the practice of payment of a 13th month (ex gratia) salary had carried on uninterrupted for 23 years, it had become a custom between the parties, such that a party could seek its enforcement through judicial process.

Giving lucid conceptual clarifications on the power of the employer to suspend or dismiss an employee; the legal consequences of 'suspension'; and when an allegation of conflict of interest can be made against an employee, and the corresponding duty on the employer to establish the allegation of conflict against the dismissed employee, the court in Mr Peter Olasunkanmi Atoki v. Ecobank Nigeria Ltd13 held that the defendant bank failed to establish the conflict of interest and professional misconduct against the claimant to its satisfaction.

Despite the excitement of a new process for settling labour grievances that is arguably pro-employee, it is instructive to mention that the cases of Awodusi Gbenga & Ors v. Total Data Limited14 and Mr Osamota Macaulay Adekunle v. United Bank for Africa Plc15 do not necessarily support this position.

In the former case, the claimants were employed under individual and separable contracts with, inter alia, differing salaries and emoluments and conditions of service. Only the first claimant was called to testify. The court had to invoke its equitable jurisdiction to rely on the documents 'front loaded' but never tendered in evidence16 to avail the fourth claimant of the relief sought on the substantive suit. There was no such document before the court to avail the remaining 142 claimants of any relief. The court held that: 'Failure of the other Claimants except 1st and 4th to lead evidence in proof of their claims has fatally damaged same [...]. The claims of the 1st and 4th Claimants succeed in part while those of the other claimants fail and are dismissed accordingly.'

In the Osamota case, the claimant only sought declaratory reliefs, which by law, cannot be executed, being merely declaratory as to the rights and obligations of parties. But that was not the only pitfall. The specifics were not clearly stated or established. The Court noted disapprovingly that even though the claimant sought a declaration that he was entitled to 'all his entitlements, salaries, allowances, bonuses, emoluments and other perquisites of office' from 17 September 2009, when he was suspended, to the date of the judgment, those were not shown in specific terms: 'I must stress that since the claimant's "entitlements, salaries, allowances, bonuses, emoluments and other perquisites of office" have not been proved before this Court, this Court cannot make any order in their regard.'

ii Jurisdiction

The circumscribed jurisdiction of the NICN as an exclusive labour dispute resolution forum came up for consideration in a few cases in the year under review. In many decisions on this point, the NICN reiterated that its prescribed jurisdiction does not extend to matters with claims dealing with tax, pensions and allied issues that the aggrieved employee often claims as ancillary to his principal claims. In Miss Odiette Hope v. Jopa Energy Ltd,17 the court declined the invitation to exercise jurisdiction over a tax related relief contained in the claim before the court.

In Sir HUC Chukwudire & Ors v. Governor of Imo State & Ors,18 the NICN also had an opportunity to affirm its inelastic jurisdiction as not extending to tenancy-related issues. The NICN has similarly refused to adjudicate over matters involving contractual relationships between an independent contractor and the hirer.19

Non-compliance with a condition precedent to the court exercising jurisdiction on a relief conferred on an employee under the Employee's Compensation Act 2010 was successfully raised and argued in Mr Mashood Ilupeju v. PZ Cussons Nigeria Plc.20

iii The final instance court

A litigant who is not satisfied with the decision of the NICN can only appeal as of right where the decision relates to questions of fundamental rights as contained in Chapter IV of the CFRN or in criminal cases where they relate to matters upon which the NICN has jurisdiction. Appeal in other matters shall only lie from decisions of the NICN to the Court of Appeal as may be prescribed by an act of the National Assembly and with leave of the Court of Appeal.

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1 Chapter T8, LFN 2004.

2 Section 254C (2).

3 Section 243 (2) of the CFRN. 4 National Bureau of Statistics website: Job Creation Survey Report ( pages/download/186).

5 Ibid.

6 National Bureau of Statistics website: Social Statistics Report in 2012 ( ng/pages/download/170).

7 Section 245C (1) (f ) of the CFRN 1999, as amended.

8 Unreported suit No: NIC/PHC/79/2013 delivered on 26 June 2014 (; The NICN held that an employee need not necessarily prove his employment by a written employment letter to maintain a claim against an employer.

9 Unreported suit No: NIC/PHC/55/2013 delivered on 26 June 2014 (

10 Unreported suit No: NICN/AB/03/2012 Godwin Okosi Omoudu v. Prof Aize Obayan & anor, judgment delivered on 10 October 2014 ( php?contC=694).

11 Section 254D [2] of the 1999 Constitution [as altered] and Sections 14 and 19 [d] of the National Industrial Court Act, 2006.

12 Unreported suit No.NICN/LA/555/2012, judgment delivered on 17 October 2014 (http://

13 Unreported suit No. NIC/LA/103/2011, delivered on 12 June 2014 (http://judgment.nicn. 13 Unreported suit No. NIC/LA/103/2011, delivered on 12 June 2014 (

14 Unreported suit No: NICN/LA/490/2013, judgment delivered on 24 August 2014 (http://

15 Unreported suit No: NICN/IB/20/2012 judgment delivered on 21 May 2014 (http://

16 The front-loading system is a requirement under the High Court Rules designed to ensure full research and knowledge of the facts of a case, with processes relating thereto and full preparation of evidence being brought to the attention of the court before the hearing of a suit. Both parties are required to file alongside the pleadings certain supporting items, ensuring full and upfront disclosure of their respective cases.

17 Unreported suit No: NICN/LA/408/2012, judgment delivered on 31 March 2014 (can be accessed at Similar decisions were handed down in Ganiyu Kolapo Rafiu v. Sara Foods Ltd, Unreported suit No: NICN/ LA/388/2012, judgment delivered on 30 September 2014 (; Mr Henry Nwosisi v. Bridgeways Global Projects Ltd, Unreported suit No: NICN/LA/147/2013, judgment delivered on 9 October 2014 (; and Ms Edith Ejiogu v. Mainstreet Bank Estate Company Ltd, Unreported suit No: NICN/LA/48/2013, judgment delivered on 9 June 2014 (

18 Unreported suit No. NIC/OW/07/2013, judgment delivered on 30 June 2014 (

19 Unreported suit No: NIC/LA/294/2012, judgment delivered on 6 May 2014, (http://

20 Unreported suit No: NICN/LA/406/2012, judgment delivered on 29 April 2014 (

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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