TERMINATION OF CONTRACTS OF EMPLOYMENT AND THE APPLICABILITY OF INTERNATIONAL LABOUR ORGANISATION STANDARDS ON UNFAIR DISMISSAL IN NIGERIA

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ABSTRACT

Industrial and labour relations occupy an important and  enviable place in the socio-economic development of any nation in particular and the world at large. The conditions under which an employee works as well as the security of his employment has great bearing on his output which in turn affects the socio-economic development of the nation wherein the employee performs his work. The desire to ensure maximum performance and protection of the employees in their mostly ‘begger has no choice’ situation has constantly motivated and enhanced the efforts of the International Labour Organization, an agency of the United Nations towards setting acceptable standards for the protection of  interest of employees. Issues bordering on determination of contract of employment take dominant position in industrial and labour relations. Unfair dismissal is one of the problems plaguing employees in developing countries like Nigeria. The International Labour Organisation set a standard which an employer wishing to terminate employment of his employee must comply with. The attribute of international law under which the standards of the International labour organisation falls   make the  application of these standards dependent on the state of the municipal laws of member states of the International Labour Organisation. The provision of the Constitution of  the Federal Republic of Nigeria 1999 as amended, subjects these standards to the Legislative Acts of the federal law makers. However, the Third Alteration Act and the National Industrial Court Act have brought what seems to be a statutory intervention on the application of these standards. The researchers undertake the study of the International Labour Organisation’s standards on unfair dismissal of an employee vis-a-viz the practice in Nigeria, the attitude of Nigerian Laws to these standards as well as the applicability of these standards in Nigeria and selected countries. The researchers employ analytical comparison of Nigeria laws and practice on determination of contract of employment as well as laws of the selected countries as they relate to the International Labour Organisation standards on unfair dismissal. Also, the researchers adopt construction of statutes and case law as part of their methodology. At the end, the researchers found that dismissal and termination situations in Nigeria amount to unfair dismissal when tested against ILO standards on unfair dismissal. The researchers then recommend that Nigeria needs to adopt ILO standards on unfair dismissal with modifications where necessary. Also, that every legal and institutional impediments that hinder the application of ILO Convention on unfair dismissal should be removed by the concerted efforts of the three arms of Government of Nigeria  for purposes of achieving the policy of fair dismissal in Nigeria.

CHAPTER ONE

INTRODUCTION

A discussion on the applicability of ILO standards on unfair dismissal cannot be appreciated without an understanding of the background, problems, scope, objective and significance the study as well as meaning of contract of employment as unfair dismissal is a phenomenon in contract of employment.

1.1 Background of the Study

The law and practice of determination of contracts of employment in Nigeria is employer friendly. The employer is free to determine the contract of employment of his employee for bad reasons or for no reason at all. This is in contradistinction with the law and practice across the world. This shows that the law and practice of determination of contracts of employment differ with those of other countries. This difference is occasioned by the fact that some countries across the world have moved away from the common law position that permits an employer to determine the contract of employment of his employee for bad or for no reason at all. The move away from this common law position started with the International Labour organisation which adopted ILO Termination of Employment Recommendation and ILO Termination of Employment Convention 158 of 1982. About 36 countries of the world have ratified the Convention while about fifty five countries both those who have ratified the Convention and those who have not ratified the Convention have embraced the provisions of the Articles of the Convention which contains ILO standards on unfair dismissal. Despite this effort by the International Labour Organisation towards ensuring a policy of fair dismissal, Nigeria is still in full practice of the common law termination at the will of the employer.

            The factors accounting for Nigeria’s failure to embrace this well-meaning convention containing ILO standards on unfair dismissal are the provisions of the Constitution of Federal Republic of Nigeria 1999 as amended requiring ratification and domestication of treaties and conventions before they can be enforced in Nigeria. None application of the convention containing ILO standards on unfair dismissal leaves Nigeria with practices which are unfair in the global perspective. This research work appraises the law and practice in Nigeria on determination of contracts of employment. It analyze termination and dismissal situations in Nigeria to see their status when tested against ILO standards on unfair dismissal, appraises the roles of the three Arms of Government of Nigeria in ensuring the application of this Convention containing ILO standards on unfair dismissal. The work also shows the extent of conformity with ILO standards on unfair dismissal by some countries.

1.2 Statement of Problem

 Issues bordering on determination of contract of employment take domination position in labour and industrial relations. Unfair dismissal is one of the problems plaguing employees in developing countries like Nigeria. Unfair dismissal practices have put employees in Nigeria in a bagger has no choice situation. Nigeria has remained under the common law determination at the will of employer.

Nigeria as a dualist state is under constitutional impediments which hinder Nigeria from embracing the International Labour Organisation standards on unfair dismissal. The attitude of the Nigerian Constitution on the application of International Labour Organisation standards on unfair dismissal in Nigeria is another major problem hindering from implementing the ILO standards on unfair dismissal. The role of the three arms of government on the application of ILO standards on unfair dismissal in Nigeria also leaves much to be desired. The step taken by the Legislature in Nigeria towards ensuring that international treaties and conventions are applied in Nigeria as provided in the Constitution of Federal Republic of Nigeria (Third Alteration) Act, 2010 is surrounded with controversy. These factors have made it difficult for Nigeria to apply the ILO Convention containing the ILO standards on unfair dismissal. None application of this ILO Convention containing the ILO standards on unfair dismissal accounts for Nigeria’s failure to achieve a policy of fair dismissal.

1.3 Objective of Study

The researchers set out to showcase the sources of ILO standards on unfair dismissal, the bases of determination of contracts of employment in Nigeria. The work is to make a conceptual clarification of the law on termination and dismissal, wrongful and unlawful termination and dismissal, classification of contracts of employment. Study the International Labour Organisation standards on unfair dismissal of an employee viz-a-viz the practice of termination and dismissal of an employee at the will of the employer. Undertake an appraisal of ILO standards as well as unfair dismissal situations in Nigeria. Showcase solutions to the common law and constitutional impediments to the applicability of ILO standards on unfair dismissal in Nigeria.  And finally to find out ways through which Nigeria can bring down the ILO Convention on termination of Employment No 158 of 1982 wherein the ILO standards on unfair dismissal are provided.

1.4 Significant of the Study

The importance of this research work is in the fact that the research is an informed agitation through an academic work for Nigeria to embrace the modern of law and practice of policy of fair dismissal. It shows by way of an appendix the extent of conformity of about 55 countries that have embraced the Convention containing the ILO standards on unfair dismissal.

            The work also undertakes a conceptual clarification of the terms ‘Termination and dismissal’ and the attendant consequences that attach to them. It clarifies the meaning of wrongful termination, unlawful termination, wrongful dismissal and unlawful dismissal and the remedies available to a victim of any of them. The researchers undertake an analysis of the ways through which the three Arms of Government of Nigeria saddled with the responsibility of ensuring that the Convention containing ILO standards on unfair dismissal becomes applicable in Nigeria without any impediments. The researchers made far-reaching recommendations that will enable Nigeria actualize the policy of fair dismissal.

1.5 Methodology

The researchers adopt analytical comparison using statute books, case law, text books, journal articles (local and international), Internal materials, unpublished works, international instruments. The work is broken into six chapters with three appendixes.

1.6 Literature Review

Determination of contracts of employment is a term encompassing termination and dismissal. A lot of literatures have been done on determination of contracts of employments locally[1] and internationally[2]. However, on the concept of unfair dismissal, there is a dearth of literature as the concept is novel in the Nigeria labour and employment jurisprudence.[3]

An attempt was made by Abagu[4] to appraise ILO standards on unfair dismissal. However, the work did not go to extent of untying the impediments in the constitution and the three Arms of Government of Nigeria on the application of the Convention containing ILO standards on unfair dismissal. This work therefore covers up that gap as it tries to analyze the factors inhibiting a hitch-free application of the Convention containing ILO standards on unfair dismissal and recommending possible way out of the predicament. The work also shows the extent of conformity with the ILO standards on unfair dismissal by about 55 countries across the world.

1.7       Meaning of Contract of Employment             

The term ‘contract of employment’ is made up of two key words: ‘contract and employment’. Apart from the definitions of the term in various labour law legislation and judicial definitions one can still derive the meaning of the term contract of employment by looking at the meaning of these two words that make up the term. A contract is defined as an agreement which the law will enforce or recognise as affecting the legal rights and duties of the parties.[5]

            A contract is an agreement whereby a person undertakes for rewards (consideration) to perform an act for another.[6] From the above definitions, it is clear that in a contract, there must be two or more parties who will undertake to perform an act for another for  purposes of receiving a reward called consideration and the agreement to do this must be such that is sanctioned by law. Where this agreement is recognised by law, one can safely say that the agreement with other elements in place has metamorphosed into a contract. That is while every contract must be an agreement but not all agreements are contracts.[7]

Also Garner[8]defines a contract as an agreement between two or more parties creating obligations that are enforceable or otherwise recognizable at law. The underlying principle in this definition is that any agreement which does not create obligations recognizable at law is not a contract. It is also pertinent to ascertain the meaning of the rest of the key word which is employment. Employment is defined as a relationship between a master and a servant.[9]

            From the foregoing therefore, contact of employment can then be defined as a relationship which exists between an employer and an employee which the law recognizes as giving rise to a legal obligation between the employer and the employee which said obligation is enforceable at law. The Labour Act[10] defines contract of employment to mean any agreement whether oral, or written, express or implied whereby one person agrees to employ another as a worker and that other person agrees to serve the employer as a worker. Implicit in this definition by the Labour Act[11] is that a contract of employment may be entered orally without the necessity of writing. This is however subject to some statutory exceptions such as the requirements of writing in a contract of apprenticeship.[12] This exception as provided in section 50 of Labour Act[13] provides that:

Every contract of apprenticeship and every assignment thereof shall be in writing; and no such writings shall be valid unless attested by and made with the approval of an authorized labour officer certified in writing under his hand on the contract or assignment.

What the section of the Act[14] depicts is that notwithstanding the general definition of contract of employment in the section of the Labour Act,[15] the Act itself provides a statutory exception to the effect that a contract of apprenticeship cannot be oral but in writing. It is also worthy to point out here that a contract of employment may also be by implication of law, without parties agreeing on the terms and conditions of the contract but because they have acted overtime on an employment relationship exchanging the necessary indices of employment, the law will imply employment relationship between them. The court has also defined contract of employment thus:

The Labour Act Cap 198 laws of the Federation of Nigeria (now cap L1 LFN 2004) which applies to workers, strictly to the exclusion of the management staff, defines a contract of employment as any agreement, whether oral or written, express or implied, whereby one person agrees to employ another as a worker and that other person agrees to serve the employer as a worker.[16]  

Save the addition of the fact that the Labour Act that gives the above definition applies to workers strictly to the exclusion of management staff; the above definition is merely a judicial restatement of section 91 of Labour Act.[17] On the form of contract of employment and whether it can be inferred, the Court of Appeal per Orji Abadua stated that:

Contract of employment may be in any form and it may be inferred from the conduct of the parties, it can be shown that such a contract was intended although not expressed. Contract of employment may arise out of agreement which is not enforceable in the law Courts because it lacks consideration.[18]

Notwithstanding the advantage the employer has over the employee and the predicament which the employee is put into in such situations, the common law recognises the interest of the employee amidst his ‘beggar-has-no choice situation’ immediately the employee agrees to enter into such relationship with the employer. A Contract of employment is built around two parties or better still it is created by two parties called the employer and the employee. It is now pertinent to ascertain who qualifies as an employer as well as an employee.

1.8       Definition of Employer and Employee

The terms ‘employer’ and ‘employee’ are normally used interchangeably with ‘master’ and ‘servant’ respectively. Employee is also sometimes referred to as a worker or a workman. What this means is that different people, and different laws use any of the above words to describe one of the parties in a contract of employment who agrees to work for another as a worker. This also explain why different statutes define the terms ‘employer and employee’ in accordance with the circumstances of the legislation in question.

            However, labour laws prefer employer and employee or worker.[19] Who then is an employer and worker or employee? The answer to this poser can be rightly gleaned from the various labour laws. By section 91 of Labour Act,[20] An employer means any person who has entered into a contract of employment to employ any other person as a worker either for himself or for the service of any other person and includes the agent, manager or factor of that first – mentioned person and the personal representatives of a deceased employer. The Employee’sCompensation Act[21]defines employer to include any individual, body corporate, federal, state or local government or any of the government agencies who has entered into a contract of employment to employ any other person as an employee or apprentice. The above definitions, it must be noted are for the purposes of the application of their respective Acts. The definition of employer in the Employee’s Compensation Act, appears to be more comprehensive as it lists the persons who are qualified as employers to include governments at all levels, departments and agencies of governments at all levels and by the opening word of the section, it means that so many persons and institutions not mentioned are also qualified to be employers once they enter into a contract of employment in any form. The labour Act[22] defines a worker to mean:

Any person who has entered into or works under a contract with an employer whether the contract is for manual labour or clerical work, or is expressed or implied, or oral or written, and whether it is a contract of service or a contract to personally execute any work or labour.

The Employee’s Compensation Act[23] prefers the word employee and defines employee thus:

Employee means a person employed by an employer under oral or written contract of employment whether on a continues, part-time, temporal, apprenticeship or casual basis and includes a domestic servant who is not a member of the family of the employer including any person employed in the federal, state and local Governments, and any of the government agencies and in the formal sectors of the economy.

This definition as all encompassing as it may look is meant for the purposes of the Employee’s Compensation Act which can be gleaned from the objective of the Act.[24] Section 1 of the Act[25]provides thus:

The objectives of the Act are to:

(a) Provide for an open and fair system of guaranteed and adequate compensation for all employees or their dependents for any death, injury, disease or disability arising out or in the course of employment;

(b). Provide rehabilitation to employees with work related disabilities as provided in the Act;

(c). establish and maintain a solvent compensation fund managed in the interest of employees and employers;

(d). provide for a fair and adequate assessment for employers;

(e) Provide an appeal procedure that is simple, fair and accessible, with minimal delays, and

(f) combined efforts and resources of relevant stakeholders for the prevention of workplace disabilities including the enforcement of occupational safety and health standards.

A careful look at these objectives of the Employee’s Compensation Act will show why the Act gave an all encompassing definition of who falls under the definition of an employee to be entitled to the benefits of the Act. The judicial sanction of the opinion of the researchers is made manifest by the fact that the definition of the word employer or employee or worker in judicial authorities are merely judicial restatements of the provisions of  the relevant labour law legislation in the light of facts and circumstances of a case at hand. In Shena Security Co. Ltd v Afropak (Nig.) Ltd[26]  the Supreme Court of Nigeria stated as follows on the meaning of a worker:

‘A worker is defined by the labour Act, Cap 198 Laws of the Federation of Nigeria 1990 impari material with Cap L1 LFN 2004 as any person who has entered into or works under a contract with an employer whether the contract is for manual labour or clerical work, or is expressed or implied, or oral or written and whether it is a contract of service or a contract personally to execute any worker labour. Such a contract is commonly referred to as a contract of service.’

There is a prevalent difficulty inherent in attaching a precise meaning to the terms. This is why different statutes try to obviate the problems by defining the terms for purposes of their provisions. It then means that the meaning of worker in the labour Act[27] is purely for the purpose of the Act. Implicit in this, is that all rights and liabilities in the provisions of any Act can only accrue to a person who has qualified as a worker or employee in accordance with the provisions of the Act in question. It is pertinent at this juncture to note that, certain categories of employees are statutorily under the provisions of the labour Act as against other labour legislation. A careful insight into the provisions of labour Act aforesaid seems expedient. Section 91 (a-f) of labour Act[28]  provides that:

Worker means any person who has entered into… but does not include-

(a) any person employed otherwise than for the purposes of the employer’s business, or

(b) persons exercising administrative, executive, technical or professional functions as public officers or otherwise; or

(c) members of the employer’s family; or

(d) representatives, agents and commercial travelers in so far as their work is carried on outside the permanent work place of the employer’s establishment; or

(e) any person to whom articles or materials are given out to be made up, cleaned, washed, altered, ornamented, finished, repaired or adapted for sale in his own home or on other premises not under the control or management of the person who gave out the articles or the material; or

(f) Any person employed in a vessel or aircraft to which the law regulating merchant and shipping or civil aviation applies.     

By the tenor of the above provision, certain persons are excluded from the operation of the Labour Act. Paragraph (a) of the section excludes domestic services which are necessarily incidental to effective performance of the work of an employee. The wisdom behind paragraph (b) of the section can be ascertained from the fact that these administrative, executive and technical officers in the public service may have different statutes regulating their employment while civil servants in the strict sense of the words have their employment regulated by civil service Rules.[29]

            One important point that is clear in the statutory exclusions is that those mentioned are outside the ambit of the provisions of the Labour Act. It is imperative here to point out that the Act cited above[30] dispenses with the terms master and servant which have the privilege of being the only recognized and used terms that refer precisely to the employment relationship of contract of service as against contract for service where the servant is actually not a servant but the so called independent contractor. However, the Act still leaves untouched the scope of master and servant relationship and as well widens the scope.

1.9       Contract of Service Distinguished from Independent Contractor

Employment may give rise to a number of relationships. A person may be employed as an employee or an independent contractor or as an agent.[31] There are different consequences attached to each relationship which makes a distinction of the relationships expedient. The essence of the distinction between an employee and an independent contractor in a contractor of employment are as follows:

(a) To know when the common law implied duties inherent in a contract of employment will become applicable.[32] 

(b) Secondly, the common law doctrine of vicarious liability is confined to the relationship of employer and employee. An employer may be held liable for a tortuous act committed by his employee in the cause of employment.[33]

(c) Thirdly the various labour statutes do not apply generally to those who are not employees at common law[34] and those who are not covered by a statute cannot in any circumstance claim under that particular labour statute as employee. In other words, there must of necessity exist between the employer and the employee or worker a master servant relationship.[35] Despite the existence of master and servant relationship between the employer and the employee, a worker claiming under the labour Act must show that he is covered by the Act.[36]

            Having ascertained the importance of the distinction between contract of service and contract for service otherwise called independent contractor, and that an employee in the former is regarded as a servant while an employee in the latter is regarded as an independent contractor, the task now is the difficulty in arriving at a proper status of an employee. This difficulty has been prevalent over the years leading the courts to evolve certain criteria for distinguishing an employee in contract of service and one who merely enters into a contract to personally execute work or service. These criteria or rules are referred to as the test for ascertaining a servant. They include the:

  1. Control test.
  2. Organisation test
  3. Multiple tests
  4. The modern approach.

A cursory glance at these tests is of necessity and they shall consequently be taken seriatim:

1.9.1    Control Test

The control test is the original or traditional test. It is also referred to as the superintendent test. Under this test, an employee is a servant if he is subject to the control of the employer as to the manner of doing his work.[37] However, the control factor can be overshadowed by other non-employment factors such as the non-employment factors introduced in Ready mixed Concrete (South East) Ltd v Minister of Pension and National Insurance.[38] Examples of non-employment factors include situations where an employee is paid by way of fees, where an employee is allowed to delegate his duties, where an employee is to invest and provide capital for the work to progress and where no office accommodation and secretary is provided by employer. This means that whether or not an employer controls the manner the employee does his work, there must exist factors showing the existence of contract of employment.

1.9.2    Organisation Test

This is also known as integration test. It was propounded by Lord Denning L.J. (as he then was) in Cassidy v Minister of Health.[39] This test arose out the inadequacies of the control test in view of the sophistication of modern industrial establishments as well as high level of professionalism and skill of modern day employees. Modern day employees have acquired high level of technological knowhow that the employer may not be in a position to control the manner in which the employee does his work. The organization test even though did not destroy the control test, allows the employee some level of freedom from control, yet the employee remains the employee of the employer irrespective of the fact that the employer has no control over him as to the manner he shall do his work. Under this test, it becomes less difficult to assign a status to a professional or an expert employee because a professional or an expert employee is required to use his initiatives to perform his work assigned to him.

            Yet this type of employee is still regarded and considered as a servant according to Lord Denning because he is employed as part and parcel of an establishment and his work is done as an internal part of the business.[40] According to Lord Denning:

One feature which seems to run through the instances is that under a contract of service, a man is employed as part of a business and his work done as an integral part of the business, whereas under a contract for service, his work, although done for the business is not integrated into it but is only accessory.[41]

It must be noted that the reason employers are still liable for any tort of their employees in such cases is not because the employer controls the manner in which the work is done, for they have no sufficient knowledge to do so but because they employ the staff and have chosen them for the task and have in their hands the ultimate sanction for good conduct and the power of dismissal.[42] The organization test did not in any way or manner displace the control test; rather it merely improved the control test to cover perceived difficulties in cases of experts and professionals. To arrive at a conclusion that one is a servant of a master the two tests must be considered.[43]

1.9.3    The Multiple Tests

There exists a glaring difference between the organisation test discussed above and the multiple tests. Organization test merely widened the scope of the control test to accommodate professionals and experts without actually destroying the control test. Multiple tests posit that the organization inherent in employment is shown by multiple factors apart from control. Such factors include time of work, provision of working tools, holiday and gratuity or pension benefits. The multiple tests envisage that in any particular circumstance where two or more elements of employment point consistently to one direction or another such may determine whether there exists a contract of service or contract for service.[44] It is important to state here that parties cannot by simply attaching a different label to their contract, alter the true nature of their contractual relationship under the common law.[45] However, where the nature of the relationship is ambiguous and there exist an agreement whether oral or written showing intention of the parties, the agreement will be decisive on what the nature of the contract is.[46]The application  of the multiple tests occurred in the Supreme Court case of Shena Security Co. Ltd v Afropak (Nig) Ltd[47] where the appellant supplied the respondent with security personnel for a fee on monthly bases and there existed agreement as to period of notice for each party to terminate the agreement. The respondent terminated the relationship contrary to the parties’ agreement and the Court held that, where there is a dispute as to what kind of contract of employment parties entered into, there are factors which will usually guide the Court of law in arriving at a right conclusion. For instance:

(a) if payments are made by way of ‘wages’ or ‘salaries’, this is indicative that the contract is one of service. If it is a contract for service, the independent contractor gets his payment by way of ‘fees’. In a like manner, where payment is by way of commission only or on the completion of job that indicates that the contract is one for service.

(b) where the employer supplied the tools and other capital equipment, there is strong likelihood that, the contract is that of service. But where the person engaged has to invest and provide capital for the work to progress that indicates that it is a contract for service.

(c) In a contract of service/employment, it is inconsistent for an employee to delegate his duties under the contract. Thus where a contract allows a person to delegate his duties there under, it becomes a contract for service;

(d) where the hours of work are not fixed, it is not contract of service;

(e) It is not fatal to the existence of a contract of service/employment that the work is not carried out on the premises of the employer. However, a contract which allows the work to be carried on outside the employer’s premises is more likely to be contract for services;

(f) where an office accommodation and a secretary are provided by the employer, it is a contract of service/employment’

The modern approach to this issue renders intention of the parties not as paramount as  the common law may seem to make it. This is because the modern approach is concerned with the elements in existence in the parties’ contractual relationship as against what they intended. The modern approach finds support from the case of Ready Mixed Concrete (South East) Ltd v Minister of Pension and National Insurance[48] wherein Mackenna Jeshethen suggested that a contract of service exists if the following conditions are fulfilled:

a) The servant agrees that in consideration of a wage or other remuneration he will provide his own work and skill in the performance of some services for his master;

b) He agrees, expressly or impliedly, that in the performance of the service he will be subject to the other’s control in a sufficient degree to make that other his master; and

c) The other provisions of the contract are consistent with its being a contract of service.

            In addendum to the criteria for ascertaining the appropriate status of a worker or servant Corker J. held in the case of Market Investigation Ltd v Minister of Social Society[49]that:

The fundamental test to be applied is this: ‘is the person who has engaged himself to perform these services performing them as a person in business of his own account? If the answer is ‘yes’, then the contract is a contract for service. If the answer is ‘no’ then the contract is contract of service. No exhaustive list has been compiled and perhaps no exhaustive list can be compiled of consideration which are relevant in determining that question, nor contract rules be laid down as to the relative weight which the various considerations should carry in a particular case.

The most that can be said is that, control will no doubt always have to be considered, although it can no longer be regarded as the sole determining factor and factors which may be of importance, are such matters as to whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk he takes, what degree of responsibility for investment and management he has and whether and how far he has an opportunity of profiting from sound management in the performance of his task.[50]  

The importance of the above is that the two above stated factors or test of control and organisation are mere guides and cannot be decisive as the modern approach is the consideration of all the facts and circumstance of a particular case to see whether sufficient employment factors present are consistent and point to one direction, that is, the direction of a contract of service, otherwise the employee becomes or is deemed an independent contractor. This is the current legal position on the issue of ascertainment of the requisite legal status of an employee as against an independent contractor. It must be borne in mind that the essence of this jurisprudential insight into the factors for ascertaining the requisite legal status of a worker or employee is to know who will be covered by this work in the event of cases of determination of employment and dismissal.  Who can claim that his dismissal or termination of employment was unfair and may want to make recourse to ILO standards on unfair dismissal. Better still to ascertain those covered by the contractual relationship sought to be protected by ILO standards on unfair dismissal.

1.10     Classes of Employees

Employment relationship between an employer and an employee is based on contract. It is a relationship which assumes equality between the parties[51] and thus does not create any superior right beyond what the contract of employment provides.[52] It is important to note that under Nigeria labour law jurisprudence, contract of employment does not in any way create collective interest or right. This point was made clearly in the case Bosah v Julius Berger Plc[53] wherein the Court held that:

In the realm of master and servant relationship, even though ten or more persons are given employment the same day under the same condition of service, the contract of employment is personal or domestic to each. In the event of breach, the persons do not have a collective right, to sue or be represented in the suit.

This however, does not reflect the position in the public sector[54] It is also important to note that the position aforesaid does not accord with the current trend of the law to do justice to parties. The current position of the law permits the bringing of action in a collective capacity.[55] It is also my submission that despite the position in the cases of Bosah v Julius Berger Plc[56] and Co-operative & Commercial Bank (Nig) Plc v Rose[57] fundamental rights actions emanating from labour and employment relationship can be brought collectively by virtue of the jurisdiction now conferred on the National Industrial Court.[58] The discourse under this subchapter is important for purposes of knowing the categories of employees in Nigeria to whom the international labour organisation standards on unfair dismissal apply.

1.10.1  Domestic Servant

The Labour Act[59] defines a domestic servant as any house, stable or garden servant employed in or in connection with the domestic services of any private dwelling house, and includes a servant employed as a driver of a privately owned or used motor car. This definition does not or rather the Act does not give the definition of domestic service thereby allowing the meaning to be derived in accordance with the facts and circumstances of individual cases in the light of the common law rules. Domestic servants are mainly engaged to be about their employer’s persons for purposes of ministering to their needs, including the needs of those who are members of their employers’ family or their guests. They are engaged under contract of personal service.

            In Olaniyan v Unilag[60]  Oputa J.S.C. (of blessed memory) noted that in this type of contract personal pride, personal feelings, personal confidences and confidentiality may all be involved. The consequence of this class of employment is that the employee is only entitled to reasonable notice to enable the employee terminate the contract of employment. The employer can terminate at will with reasonable notice or salary in lieu of notice. In Todd v Kerrick,[61] it was held that a governess could not be treated as a domestic servant entitling her only to the customary one month notice of termination of service available to that type of menial employment. Also in Wilson v Uccelli,[62] it was held that a private tutor is not a domestic servant. A domestic servant is not also entitled to fair-hearing. However, the position under the common law cannot override the agreement of the parties irrespective of the nature of the work the employee is employed to do particularly where the relevant employment factors present as was decided in the Supreme Court case of Shena Security Co. Ltd v Afropak (Nig) Ltd[63]  are present.

1.10.2  Office Holder

At common law, persons who do not fit into the definition of servants but nevertheless enjoy the inherent advantages in the consequences of employment are referred to as office holders. The rationale for this, is that a holder of an office is usually not under a contract to personally execute any work for any person and his employment is not necessarily one of contract of service, rather holding office, he is entitled to a hearing before termination of his appointment and if he is wrongly removed from office, the court will order his reinstatement upon his application.

In Great Western Railway v Bater,[64] Rowlatt J. defined an office as follows:

A subsisting, permanent, substantive position which had an existence independently from a person who filled it, which went on and was filled in succession by successive holders.[65]

According to Emiola, a residual office holder may be defined as:

A holder of an office of emolument attached to an institution or institutional office, the appointment of which is vested in a person or body of persons who or which does not come within the legal definition of ‘master’ at common law or ‘employer’ under any statute.[66]

An office holder ordinarily does not qualify to be an employee as there is no employer who engaged him in that relationship. Rather he is occupying an office but enjoys the consequences inherent in an employment. The position according to Emiola is that the appointment of a resident office holder can be made or determined only in accordance with the custom of the office or the established procedure laid down specifically for that purpose.[67] The importance of office holding lies in the remedy available at common law to a holder who is wrongfully removed from office.[68] Two consequences however attach to the tenure of employment of an office-holder.

            Firstly, the power to remove an office holder is generally subject to the rules of natural justice.[69] This presupposes that an office-holder must be given adequate time and facilitates to make his representation in reaction to the allegation against him before he will be removed and he must also be given an opportunity to be heard. A holder of an office is not under any contract to personally execute any work for another and his employment is not necessarily one of contract of service but by virtue of holding an office, he has certain rights which entitles him to a hearing before dismissal and if he is wrongfully removed from office, the Court will on the application of the aggrieved employee make an order of reinstatement.

 1.10.3 Private Sector Employee

This category of employees hitherto applies to employer-employee relationship regulated purely by the contract agreement of the parties without more. This operates mostly in private sector employment under Nigeria labour law jurisprudence where an employer who is referred to as the master is competent to “hire and fire” at will or without motive.[70]  This is the ordinary master-servant relationship and upon wrongful dismissal, an employee will be entitled to damages only and not order of specific performance.

1.10.4  Public Sector Employees

This is also another category of employees whose true status and nature had been erroneously perceived. These categories of employees are those employed either by the Federal, State or Local government or by statutory corporation or companies wholly owned or substantially owned and financed by any of the above tiers of government. Employees under this category are called public servants as defined in the Constitution.[71] Generally, the employment of employees in the public sector has statutory force.[72] It has been erroneously perceived that once a person is employed in the public service as defined by the Constitution, the person’s employment will acquire statutory protection. This is erroneous as public servants do not have the same contract of employment just because the constitution or statute classifies them as public servants. [73]

1.10.5  Employment with Statutory Flavour

These are employees whose contract of employment is regulated, either by the Constitution, statutes or civil service rules whether of the Federal Civil service or state civil service. An employee here is usually employed by an employer who is a creation of statute.[74] The implication of this class of employment is that the statute creating the employer protects the tenure of the employment of its employees by making statutory prescriptions which must be followed before any employee of that undertaken can be removed from his employment. The fact that an employer is a creation of statute does not ipso facto make his employee’s employment one with statutory flavour.[75] It is also instructive to note that the fact that an employee is in public office does not also automatically qualify his employment as one with statutory flavour.[76]

The Court had held that conditions of service which will give statutory flavour to a contract of employment cannot be a matter of inference. There must be conditions which are set out in a statute or regulation made pursuant to the statute.[77]Also on the meaning and nature of contract with statutory flavour, the Court in the case of Oluseye v Lawma[78] held that an employment with statutory flavour arises where the body employing the man is under some statutory restriction as to the kind of contract which it makes with its servants and the grounds upon which it can dismiss the employee. Where an appointment is regulated by statutory provision such an appointment is said to enjoy statutory flavour or protection.[79] Any other contract other than the ones regulated by statute or regulation made pursuant to a power derived from a statute is governed by the contract of employment of the parties.[80] From what has been said so far on contract with statutory flavour, one can decipher certain salient points such as the fact that for an employment to be regulated by statute or a regulation, it must be made pursuant to a power granted by a statute or a regulation made pursuant to a power derived from the statute. It is also important to note here that if the employment is regulated by a regulation made pursuant to a power derived from a statute, the said regulation will have the same force of law as the enabling statute under which it was made provided it does not conflict with the provisions of the enabling statute.[81]

1.11     Judicial Attitude to the Nature of Contract of Employment

Over the years, there have been persistent efforts by jurists to ascertain the precise criteria for determining who are actually employees and their exact status as well as the requisite legal classification of contract of employment. This is caused by the prevarication of the nature and status of employees vides judicial authorities based on statutory interventions.

            From the common law position on the criteria for ascertaining who a servant or worker is, one can see that the common law position placed emphasis on the ‘control factor’ which we have earlier discussed. From the control factor to the development of the organization test by Lord Denning (Master of Rolls), down to the multiple test which in tandem with the present modern approach which posits that once there are two or more employment factors pointing consistently to one direction, that is the direction of employment, the employee will be deemed a servant and such contract will be one of service and not for service. This modern approach was espoused in the case of Ready Mixed Concrete, (South East) Ltd v Minister of Pension and National Insurance.[82] The Supreme Court of Nigeria also lent credence to this development of the common law test of ascertaining a servant in the case of Shena Security Co Ltd v Afro Pak (Nig) Ltd.[83] The Supreme Court in this case enumerated a lot of factors which will guide a court in the determination of whether there exist a contract of service between parties or not. Such factors include provision of equipment, office accommodation, office secretary and where payment is salary and wages. The Court’s enumeration is indicative of the fact that the list is not exhaustive and there is no hard and fast rule for determining the existence of master-servant relationship. It also shows that each case will be decided based on its facts and circumstances. Therefore, the current attitude of Nigerian courts on the test of ascertaining whether an employee is a servant or an independent contractor is that the Court faced with such question will determine that question by searching for the existence of the employment factors and where two or more of the factors point consistently to the direction of contract of employment/service, the court will so hold.[84] As regards classification of contract of employment, judges have in the past classified contract of employment into domestic servant, master-servant relationship, office-holders and contract with statutory flavour.[85]

This classification which has been developed by judicial authorities particularly that of the Honourable Justice Oputa J.S.C. (of blessed memory) can be found in the case of Olaniyan v University of Lagos.[86] At this stage in the development of the classification of contract of employment, the Court’s attitude is to the effect that there exists a contract of employment wherein personal pride, personal feelings, personal confidence and confidentialities may be involved and such employee is termed domestic servant.[87]   Also there is another category wherein a person occupies a subsisting, permanent, substantive position which had an existence independent of the person who occupies the office and which went on and was filled by successive holders, the occupier here is termed office-holder while another category places emphasis on whether an employee is employed in a government owned establishment whether wholly or substantially owned or whether the employee is employed in a privately owned establishment. Before this time it was not certain whether employees at the state (i.e. government) were employed under a contract of employment.[88] The better view then was that servants of the state (Crown) were employed under contract but the crown could put an end to the contract at any time and for no reason and without any compensation for loss of job.[89] In the English Court of Appeal case of Dunn v Queen,[90] the Court stated that:

There must be imported into the contract for the employment of the petitioners the term which is applicable to civil servants generally, namely that the crown may put an end to the employment of its employees at its pleasure.[91]

This common law position was later given statutory support by the provisions of the then Pensions Act[92] which provided that nothing in the Act shall affect the right of the crown to dismiss any officer at any time without compensation.[93] This shows that at common law what was termed public employment was at the pleasure of the government. That is to say that public employees were servants in the strictest sense of the word. However, even at common law, the right of the crown to dismiss its employees at pleasure could still be negatived by law.[94] The position of public officers has however changed by virtue of section 6(6) b of theConstitution.[95] By virtue of the above section of the Constitution public officers can now sue the government for wrongful dismissal. This was followed in the case of Shitta-Bey v F.P. S.C[96] wherein the Supreme Court held that the employment of public servants[97] are regulated by Civil Service Rules and also statutes for those employed in government establishments other than government ministries and departments stricto sensu. In Oguche v Kano State Public Service Commission[98] Wheeler J. stated that:

It is now common ground, in the present case, that the public service regulations made under the now repealed (constitution) Order in Council 1954, originally published as NRLN 80 of 1960 and now published in vol. iv of the laws of Northern Nigeria, still regulates the procedure of the public service commission of Kano state… Reading these regulations, I am satisfied that they fetter the right of the state to dismiss its servants at will.[99]

This shows that the law has developed to the extent of the Constitution negativing the inhibition on the rights of the individual employee to sue the state as placed by the Petition of Rights Act.[100] It is also instructive to note that the development of the law as regards classification into public and private is of no moment by the current judicial attitude. This is because whether private or public, the current judicial attitude is to sec whether the particular contract of employment is protected by statute otherwise it will fall to the realm of ordinary master-servant relation.[101] In Registered Trustees, P.P. L.N. v  Shogbola,[102] the Court of Appeal Lagos Division held thus on types of contract of employment:

Contract of employment are of two types viz: simple contract of master and servant relationship under common Law and contract of employment with statutory flavour. In simple contractual relationship of master and servant, actions in damages lie for its repudiation or breach by wrongful dismisses, so that if an employer wrongfully dismissed the employee either summarily or by giving insufficient notice, employment is all the same effectively terminated. On the other hand, employment with statutory flavour is where the appointment and dismissal of an employee are regulated by a statute in which case some rights and obligations are given and imposed respectively, usually beyond the ordinary contract of employment. A declaratory relief coupled with damages could be granted if the requirement of the statute is not complied with.[103]

            But for the absence of office holders, I agree with the categorization above by the Court. However, in Ujam v I.M.T,[104] the Court stated that:

There are three types of employer/employee relationships with different consequences viz:

(a) under the common law where; in the absence of a written contract, each party could abrogate the contract on a week’s or one month’s notice or whatever the agreed period for payment of wages.

(b) where there is a written contract of employment between employer and employee, in such a case, the Court has a duty to determine the rights of the parties under the written contract.

(c)(i) public servants-where their employment is provided for in a statute and/or conditions of service or agreement.

(ii) Public servants as in the civil service.

The foregoing analysis of the judicial attitude to classification of contract of employment shows that judicial opinion on what a particular contract of employment is prevaricates and is devoid of exactitude. This is seen from the opinions of the justices of the superior courts who will at one time say that there are only two classes of contract of employment which are ordinary master servant relationship and contract with statutory flavour and at another time classify contract of employment into three which include public employee as a class divided into public employee whose employment are regulated by statute and public employee in civil service. I cannot but stand on the existing classification given by his Lordship Oputa J.S.C (of blessed memory) in Olaniyan v University of Lagos[105]  which is to the effect that a contract of employment is classified into domestic servants, office-holders, master-servant relationship and contract with statutory flavour.

            This concurrence of mine is influenced by the fact that what ought to determine a particular class of contract of employment is the procedure involved in the event of termination of the employment or dismissal of the employee as well as the remedies available in the event that an employee is wrongfully or unlawfully removed from his employment. What determines each class is also dependent on the contract of employment or the statute regulating the employment. The judicial attitude to the exact nature of a contract of employment has moved away from the class of employment hitherto referred to as private or public employment to now show that such classification of contract of employment is now of no moment. This is because the opinion of the Court at present is that contract of employment hitherto called private sector employment can either be an ordinary master-servant relationship or contract with statutory flavour. This is because where a statute regulates the appointment and removal of an employee in a private establishment such employee is said to have a contract with statutory flavour the fact of being in a private establishment notwithstanding. The Supreme Court decision in the case of Longe v FBN Plc,[106] made it clear that once there is a statute or regulation made pursuant to a statute which regulates employment of an employee, the employee’s contract of employment is deemed to be with statutory flavour.

         The point made above is that the fact that an employer is a creation of statute does not by that very fact make a contract of employment one with statutory flavour rather it must be shown that a statute regulates the particular employee either expressly or by necessary implication.[107] In the same vein, where an employee in a private sector has his employment backed by statute or regulations made pursuant to a statute, the employee’s employment is said to be with statutory flavour.[108] This class of employees in the private establishment whose employment is with statutory flavour is majorly seen in employment created pursuant to the provisions of Companies and Allied Matters Act.[109]

This is made manifest in the case of a director of a company incorporated under the Companies and Allied matters Act.[110]The removal of a director is regulated by section 262(1)[111] which provides that a company may by ordinary resolution remove a director before the expiration of his office notwithstanding anything contained in the articles or in the agreement between the company and the director. The effect of this provision is that even a person appointed as a director for life or as a permanent director by the articles or by agreement may nevertheless be removed by the general meeting, subject of course to his right to compensation if any.[112] The procedure statutorily prescribed by Companies and Allied Matters Act[113] is provided in section 262(2) of CAMA.[114] Where a director is removed in contravention of the provision of the Act, the purported removal is null and void and will be set aside. It is not an answer to plead the master’s common law right to dismiss an employee since there is a statutory provision for the removal.[115]

            From the above analysis, it is obvious that an employee director of a company registered under the Companies and Allied Matters Act can only be removed as provided in section 262 of CAMA.[116] This means that such employee director’s employment has statutory flavour since the director employee cannot be removed except as allowed by the Companies and Allied Matters Act and consequently any purported removal other than as permitted by CAMA will be null and void. When an act is void, it is in law a nullity and it is deemed not to have happened. This informed the reasoning of the Court in the case Longe v First Bank of Nigeria[117] wherein the Court held that a director whose contract of employment is terminated in contravention of the provision of the Companies and Allied Matters Act regulating the procedure for removal of a director is entitled to an order of reinstatement.

In effect, such a contract though in a private establishment is deemed to be with statutory flavour. What this then means is that where an employee in a private sector has his employment protected by statute or regulations made pursuant to a statute, such as the cases of director of a company,[118] secretary of a public company[119] and auditor of public company,[120] by prescribing statutory procedure which must be followed before such employee is removed the employee cannot be removed without compliance with the laid down procedure.[121] It is important to point out here that under the Banks and other Financial Institutions Act,[122] the Governor of the Central Bank of Nigeria is vested with the power to remove directors of banks without regard to the procedure laid down in CAMA.

In Longe v First Bank of Nigeria Plc[123], the appellant was elevated to the office of a managing director from the office of an executive director of the Respondent bank granted an unauthorized loan to a customer of the respondent. The respondent sought to remove the appellant for granting unauthorised loan contrary to the respondent’s banking policy. The respondent first suspended the appellant and thereafter convened a meeting where the appellant was removed by a resolution of the respondent. Notice of the meeting where the appellant was removed was not given to the appellant and the provisions of section 262 (1-3) of CAMA regulating the procedure for removal of a director of a company was not complied with. The appellant sued and pursued his suit to the Supreme Court and the Supreme Court held that:

By virtue of the combined effect of Sections 266 (1) and 262 of the Companies and Allied Matters Act, a director to be removed must be given a notice of the meeting where he is sought to be removed and the procedure prescribed in Section 262 of CAMA must be complied with otherwise the removal will be null and void and the director who is unlawfully removed will be entitled to Order of reinstatement.

The Court therefore ordered the reinstatement of Mr. Bernard Longe to his office in First Bank of Nigeria Plc which is a private sector employment. This is the most recent judicial attitude to private sector employment to the grant of order of reinstatement which was before now taken to be in the realm of mere master-servant relationship.

1.12     Formation of Contract of Employment

Contract of employment is a species of contract and governed by the general principles of contract.[124] These general principles of contract will be appraised in this subchapter. For a contract of employment to be validly formed, all the essential elements of a valid contract must be present. They include offer and acceptance, consideration, intention of parties to create legal relation, capacity of the contracting parties and legality of the contract.

There must be offer and acceptance which are in effect the contract between the employer and the employee in a contract of employment.[125] There must also be consideration which is the exchange of promises or actual performance of work on the part of the employee and payment of wages and salaries on the part of the employer. In offering and accepting a contract of employment, there must be consideration, unless the contract is made under seal. It is therefore, the law that consideration in a contract of employment is the salary and other fringe benefits which an employee earns on the one part and the services which an employer receives on the other part. This is why a contract of employment which is bereft of consideration is not enforceable in Law.[126]

Parties must also possess the requisite legal intention to enter into a contract of employment. One common category of contract of employment that has consistently been taken to lack intention to create legal relationship between employer and employee is a contract of employment which arose from a collective agreement.[127] Another essential element which must be present for a contract of employment to be said to have been validly formed is the requisite capacity of the contracting parties. Except in a contract of apprenticeship, no person under the age of sixteen years shall be capable of entering into a contract of employment as provided in section 9 (3) of Labour Act.[128] What this provision means is that a person under the age of sixteen years can validly enter into a contract of apprenticeship. It also shows that such contract of employment which the section prohibits a person under the age of sixteen years from entering into must be a contract of employment regulated by the Act.[129]

Another special class of employees with protection is women employees. Section 91 which is the definition section of the Labour Act[130] defines a woman to mean any member of the female sex, whatever her age or status at work. The protection granted to women employees under the Labour Act includes maternity protection, night work and underground work. With respect to maternity protection, working pregnant women enjoy protection in relation to maternity leave, maintenance benefits and security of employment. Apart from these elements, a contract of employment must not be tainted with illegality just like the principles of formation of contract generally. What this means, is that contract of employment is formed like any other contract and the basic principles of formation of contract apply to a contract of employment.

1.13     Formation of Electronic Contract of Employment

A discussion on the formation of contract of employment by electronic means is no longer an academic exercise; it is of so much importance for commercial consideration as electronic transactions are fast growing. People now enter into contracts including contracts of employment electronically. Employers of labour now find the Internet as a viable means of advertising vacancies which exists in their establishments and receive applications online as well as employ people without the necessity of the parties meeting physically.

E-contract of employment are usually concluded electronically by means of e-mail, telephone, telex and fax machines. There is no reason to suppose that the development of e-mail or the World Wide Web will affect the application of the current principles of law of contract though the internet raises unique technological issues when examining the formation of e-contract of employment.127 It is these technological issues that often times cloud our analysis of e-contract of employment.

1.14     Extant Laws on E-Contracts

The first question to be addressed with regard to e-contract is whether such virtual contracts are permissible by the current state of our Laws. If the question is resolved in the affirmative, we can then move on to complex issues of when is a contract of employment concluded electronically, its terms and regulatory laws. In Nigeria today, there is no law which specifically provides for electronic contracts including electronic contract of employment. Contracts concluded electronically are guided by the general laws on contracts simpliciter and the common law principles deducible from case law. It is also interesting to note that Nigerian Courts are yet to be faced with the issue of validity of an electronic contract of whatever class including electronic contract of employment.

Many contracts today are devoid of formalities, and as such may be concluded in writing, orally or electronically. Where contracts are required to be in writing or have some other form of formal requirement such as the attachment of a physical signature or attestation by witnesses to be effective, certain practices have been accepted as meeting such requirements especially for purposes of e-contracts. These formal requirements can no longer cause problems when the principles of e-contract are applied. Reference will usually be made to the Interpretation Act128 which defines writing as including typing, printing, lithography, photography and other modes of representing or reproducing word in a visible form.

The United Kingdom Department of Trade and Industry having recognized the place of e-contract and communication in the growth of the United Kingdom economy, recommended equivalence for electronic documents and for digital signatures as part of Electronic Communication Bill. This bill was later enacted as the Electronic Communication Act 2000. Equivalence is a commonly used method of integrating new systems or technologies into a developed legal system; this is a replacement of the function of a specific document or rule with a replacement which is deemed to be functionally equivalent to it. E.g. a written document may communicate information, provide a formal record and be used as evidence of the parties’ intentions. All the rules of the written document may be equally well met by the use of electronic documents particularly in the light of the new Evidence Act.129 Therefore, in such cases, an electronic contract may be the functional equivalent of a written document, and simply replacing the one with the other has no wider impact on the specific contractual/evidential rules of the system in question.

The United Kingdom Act130, unlike many of its counterparts, does not simply provide blanket equivalence for electronic communication. It instead empowers ministers to give full legal effect to electronic communication by sub-ordinate legislation.

1.15     Legal Status of Electronic Contract of Employment

An analysis of the legal status of a thing is a determination of whether the thing in question satisfies the legal requirements for its validity. In analyzing the legal status of e-contracts, we must bear in mind that electronic contract of employment is like any other contract, the only difference being that e-contract is negotiated and concluded electronically and in many cases the employee earns his or her salary without the necessity of the employer knowing him or her and vice versa.

E-contract of employment is a contract and for it to be valid, it must have embedded in it the elements of a valid contract which are offer, acceptance, consideration, intention to create legal relation, requisite legal capacity of the parties and legality of the contract. In actual reality, parties to a contract of employment see each other while negotiating and at the conclusion of the negotiation, if the parties are agreed to the terms, a contract is consequently formed, but in e-contract of employment though parties do not see each other, they negotiate online and agree on terms and a contract results from their agreement. Once there is an offer and acceptance and other conditions or constituents are present, the validity of an e-contract of employment cannot be questioned.

At present in Nigeria, there is no known legal regime regulating e-contract of employment. Nigerian courts will definitely fall back to the well known principles of law of contract to determine the rights and liabilities of parties to an e-contract of employment.


[1] E E, Uvieghara, ‘Labour law in Nigeria’ (Lagos: Malthouse Press Limited, 2001) ; C K, Agomo, National Justice and Individual Employment Law in Nigeria’s in Current themes in Nigeria Law,  Adegbe and  Akande (eds: 1997) ; A, Emiola, Nigerian Labour Law (4th edn, Ogbomoso: Emiola Publishers Limited, 2008) ; C, Nwagbara, Determination of Contract Employment and Remedies for Wrongful Dismissal, (Nigeria: Tait Publishers, 2000). S, Erugo, ‘Security of Employment in Nigeria: A Case for Statutory Intervention’, NJLIR Vol. 1 No. 1 (2007) p.60; F, Ojo, ‘Legal Redress for Unlawful Termination of Employment: It is Time to call A Spade A Spade’, NJLIR, Vol. 1 No. 3 (2007) P. 3; A O, Elias, ‘Summary Dismissal Upon Allegation of Crime-An Overview’, MRJFIL Vol. 3 No. 3 (2000) p. 134;

C K, Agomo, Nigeria Employment and Labour  Relation, Law and Practice,(Lagos: Concept Publications Ltd,2011); R K Salman ‘Concept of Dismissal and Natural Justice: An Essential Correlation’Vol. 2 No 2, UILJ, Vol. 2 No. 2 (2005); O, Ogunniyi, Nigeria Labour and Employment Law in perspective, (Ikeja: Folio Associates Limited, 1991); O K, Edu, ‘Dismissal upon Allegation of Crime in Nigeria: Need to comply with constitutional provision’. MRJFIL, Vol.10 Nos 3-4 (2006); E,  Chianu, Employment Law (Akure: Bemicov, Publishers Nigeria Ltd, 2004) ; O D, Amucheazi and E A, Oji, ‘Reinstatement of a Dismissed Employee in a contract of Employment; A case Review of  Longe v First Bank of Nigeria Plc’, NJLIR Vol. 4 No. 2 (2010).

[2]. M R, Fredland, The Contract of Employment (Oxford: Oxford University Press, 1976) ;  G, Janner, Janner’s Compendium of Employment Law, (London: Business Books Ltd, 1997) ; Gould, ‘The Idea of The Job as property in Contemporary America: The Legal and Collective Bargaining Framework’, Brigham Young University Law Review, p. 885

[3]  O, Animashaun, ‘Unfair Dismissal: A Novel Idea in Nigerian Employment Law’, NJLIR, Vol. 2 No. 1 (2008) p. 1.

[4]  E O,  Abugu, ‘ILO standards and The Nigeria Law of Unfair Dismissal’, AJICL Vol. 17 (2009) p. 181 – 212;  J E O, Abugu, Treatise on the Application of ILO Convention in Nigeria, (Lagos: University of Lagos Press, 2009.

[5]  I E, Sagay, Nigerian Law of Contract (2nd edn Ibadan: Spectrum Books Limited 2000)P. 1

[6]  C  E, Ibe, The Law of Contract in M N, Umenweke, et al, Commercial Law and Practice in

Nigeria, ( Enugu: Nolix Educational Publications Nig, 2009)

[7] I E, Sagay,  Nigerian Law of Contract, op cit; C E, Ibe, The Law of Contract in M N, Umenweke, et al, Commercial Law and Practice in Nigeria,, Ibid.

[8]  B A. Garner, Black’s Law Dictionary (8th Edn, St. Paul Minn: West Pub. CO; 2004) p. 341.

[9]  Ibid, p. 566.

[10]  Cap LI LFN, 2004 S. 91.

[11]  Ibid S. 91. 

[12]  Ibid S. 49.

[13]  Ibid.

[14]  Ibid.

[15]  Ibid.

[16]  Shena Security Co Ltd v Afrapak (Nig) [2008] 18 NWLR (pt 1118)  77 at p.84.

[17]  Op cit.

[18]  Johnson v Mobil  Prod. (Nig) Unltd [2010] 7NWLR (pt 1194)  471.

[19]  Labour Act, op cit S. 91, Trade Unions Act Cap T14 LFN, 2004, S. 54, Employee Compensation Act, 2010  S. 72; Trade Dispute Act Cap T8 LFN 2004.

[20]  Ibid.

[21]  Op cit S. 72

[22]  Op cit S. 91

[23]  Op cit. .Note that before the enactment of the Employees Compensation Act, the Workmen Compensation Act used the term workman instead of employee.

[24]  Ibid. S. 1

[25]  Ibid.

[26]  Supra  p. 82.

[27]  Op cit.

[28]  Ibid.

[29]  Ibid S. 91.

[30]  Ibid.

[31]  E E, Uvieghara, ‘Labour law in Nigeriaop cit  p.3.

[32]  At Common law the employer has duties and as well, the employee has his own duties which the parties owe to each in a contract of employment.

[33]   Iyere v B.F.M. [2003]18NWLR (pt 1119)  300.

[34]   Iyere v B.F.M, Supra

 [35] Atedoghu v Alade (1957) WNLR 84.

[36]  Olaja v Kaduna Textiles Ltd (1972) 2WLRI 1; Shena Security Co. Ltd v Afropack (Nig.) Ltd, Supra.

[37]  Jordan and Harrison Ltd v Macdonald & Evens (1952) 1LR 101. Yewens v Noakes (1886) 6 QBD530, 532-533; United Bank Ltd v Ajagu [1990]1NWLR (pt 328) 343.

[38]  (1960) 2 QB 497.

[39]  ( 1951) KB 343.

[40]  Jordan & Harrison Ltd v Macdonald & Evans Ltd Supra.

[41]  Cassidy v Minister of Healt,h Supra.

 [42] Cassidy v Minister of Health, Supra.

[43]  Westell Richardson Ltd v Roalson (1954) 2 All ER 440.

[44]  Murren v  Swinton and Panddlebury Borough  Council (1965) ALL ER 349; Ready Mixed concrete (South East) Ltd v Minister of Pension and National Insurance, Supra.

[45]  Farguson v John Dawson & Partners (Contractors) Ltd (1978) 1NLR 1213.

[46]  Murren v Swinton Supra

 [47] Supra

[48]  Supra.

[49]  (1963) 3 All ER 732 Supra.

[50]  Market Investment ltd v Minister of Social Society, Supra.         

[51]  C K, Agomo, National Justice and Individual Employment Law in Nigeria’s in Current themes in Nigeria Law,  Art. cit  p.95.

[52]  Chukwuma v  S.P.D.C. (Nig.) [1993]4 NWLR (pt. 289 ) 512; Daniels v  Shell B.P. Petroleum Development Co.  (1962) 1 ALL NLR 19. Abaruonye v  University College Hospital, Ibadan (1959) WNLR 232; Obo v Commissioner of Education, Bendel State (2001) 9WRN 1.

[53]   [2005]15 NWLR (pt. 948)  414; See also Co-operative & Commercial Bank (Nig.) Plc v Rose [1998] 4NWLR (pt 544) .37 C.A.

[54]  C K, Agomo, Nigerian Employment and Labour Relations Law and Practice (Lagos: Concept Publications  Ltd,2011)  59.

[55]  See the preamble to the Fundamental Human Rights (Enforcement Procedure) Rules 2009 which now allows actions for enforcement of fundamental Rights to be brought in a representative capacity.

[56]  Supra

[57]  Supra.

[58]  Constitution of Federal Republic of Nigeria (3rd Alteration Act) 2010 S. 254 (C) and Preamble to the Fundamental Rights (Enforcement Proceeding) Rules, op cit.

[59]  Op cit S. 91.

[60]  [1985]2NWLR (pt. 9)  98.

[61]  (1852) 8 Exch. 152.

[62]  (1929) 45 TLR, 395.

[63]  Supra.

[64]  (1923) KB 266 at p. 274.

[65]  Ridge v Baldwin (1964) A.C. 40, at pp. 65-66.

[66]  A, Emiola, Nigerian Labour Law (4th edn, Ogbomoso: Emiola Publishers Limited, 2008) p. 28.

[67]  Igbe v  Governor Bendel State & Anor (1983)3NCLR 273.

[68]  Ridge v Baldwin Supra.

[69]  Natural Justice consists of two essential principles audi alterm parten and nemo Judex in causa sua.

[70]  Okomo oil palm Plc v Iserhienrhieh [2001] 6NWLR (pt. 710) 660; Adeniji v Governing Council Yabatech [1993] 6NWLR (pt. 300)  426; Steyer (Nig). Ltd v Gadzama [1995]7NWLR (pt 407)  305.

[71]  CFRN op cit S. 318(1); see also the Interpretation Act Cap I23 LFN 2004, S. 18(1); Shittta-Bay v F.P.S.C (1981) SC 46; Iderima v R.S.C.SC [2005)16NWLR (pt 951) 378;F.C.S.C. v Laoye [1989] 2 NWLR (pt. 106)  652.

[72]  CFRN, op cit S. 318(1).                       

[73]  Iyase v University of Benin Teaching Hospital Mgt. Board [2000]2NWLR (pt 643)  45 at 58; Isioviore v NEPA [2002]7NWLR (pt. 784) 417

[74]  For instance employees of educational institution in Nigeria.

[75]  Ujam v I.M.T. [2007]2NWLR (pt. 1019)  476 at p.477

[76]  Fakuade v OAUTH [199]5NWLR (pt. 291)  47 at p.490. Haruna v  Uniagric, Makurdi [2005] 3NWLR (pt. 912) 233 at p.246.

[77]  Ujam v U.M.T. Supra; Idoniboye – Obu v  NNPC [2003]2NWLR (pt. 805)  589; U.M.THMB v Dawa [2001]16 NWLR (pt. 739)  424; Power Holding Company of Nigeria v Offoelo[2014]3 ACELR 1-39

[78]  [2003] 17NWLR (pt. 849)  309-310.

[79]  Oluseye v Lawma Supra.

[80]  C.B.N. v Igwilo [2007]14 NWLR (pt. 1054) 396. See also Evans Bros (Nig) Pub. Ltd v Falaiye [2003] 13NWLR (pt.  838)  570; Salami v New Nigerian Newspapers Ltd [1999]13NWLR (pt. 634)  315.

[81]  Osadebay v A.-G., Bendel State [1991] NWLR (pt 169)  525.

[82]  Supra, see also Market Investigations Ltd v  Minister of Social Society Supra.

[83]  Supra.

[84]  Shena Security Co Ltd v Afro Pak (Nig) Ltd, Supra.

[85]  Oputa (J.S.C of blessed memory) in Olaniyan v University of Lagos. Supra  

[86]  Olaniyan v University of Lagos, Supra

[87]  Great western Railway v Bater Supra.

[88]  Railly v The King (1934) AC 176; Okonkwo v P.S.C Anambra State (1981) 2 PLR 359.

[89]  E E,  Uvieghara, ‘Labour Law in Nigeriaop cit p. 17.

[90]  (1896) 1 QB 116.

[91]  Dunn v Queen, Supra

[92]  Cap 147 LFN 1958.

[93]  Ibid S. 6(1).

[94]  E E, Uvieghara, ‘Labour law in Nigeriaop cit p. 17.

[95]  1979, and 1999 as amended.

[96]  Supra.

[97]  Which includes civil servants

[98]  (1974) 1 NMLR 128.

[99]  . Oguche v Kano State Public Service Commission, Supra p 135.

[100]  Cap 149 LFN, 1958.

[101]  A-G, Kwara State v  Ojulari [2007]1NWLR (pt 1061)  551 Daodu v  UBA Plc [2004] 9 NWLR (pt 878) 276 at p.278.

[102]  [2004]11NWLR (pt 883) 3.

[103]  Registered Trustees, P.P. L.N. v  Shogbola Supra; see also UBN Ltd v Ogboh [1995]5NWLR (pt 380) 647  Isioeveore v NEPA, Supra

[104]  Supra 476.

[105] Supra

[106]  [2010] 6 NWLR (pt 1189)  1                                                                                                                                                      

[107]  UMTHMB v  Dawa, Supra, p 424; Azenabor v  Bayero University Kano [2009]17NWLR   (pt. 1169)  100; (UNTHMB v  Nnoli [1994] 8 NWLR (pt 362) 374.

[108]  Longe v First Bank of Nig. Plc, Supra.

[109]  Cap C 20 LFN 2004.

 [110]  CAMA Ibid.

[111]  CAMA Ibid.

[112] J O, Orojo, Company Law and Practice in Nigeria (5th edn, Royet & Day Publications Ltd, 2008) p. 254; N C S, Ogbuanya, Essentials of Corporate Law Practice in Nigeria. (Ikoyi: Novena Publishers Ltd, 2010) p. 379; CAMA op cit S. 262(6).     

[113]  Op cit.

[114]   Ibid.

[115]  J O, Orojo, Company Law and Practice in Nigeria, op cit p. 255; See also Iwuchukwu v Nwizu [1994] 7 NWLR (pt. 251)  379

[116]  Op cit.

[117]  Supra.

[118]  CAMA op cit S. 262 (1-6).

[119]  Ibid s. 296 (1-4).

[120]  Ibid S. 357.

[121]  Longe v  First Bank Plc Supra.

[122]  Cap B3 LFN, 2004 S. 35 (182)

[123] Supra

[124]  Nwobosi v ACB [1995] 6 NWLR (pt. 404) p. 655

[125]  Appleby v Johnson (1874) 9 L.R 158; Agomo v Guiness (nig) Ltd [1995] 2 NWLR (pt. 38) 672 to the effect that there must be offer and valid acceptance to the offer before a contract of employment can be validly formed. See also Ajayi Oba v Executive Secretary, F.P.C.N. (1975) 3 SC  1

[126]  Ajayi v R.T. Briscoe (Nig) Ltd (1962) ALL NLR 673

[127]  Ford Motors Co. Ltd v Amalgamated Union of Engineering and Foundry Workers (1962) 2 GB 303; A.C.B. v Nwodika [1996] 4 NWLR (pt. 404)  658; Shauibu v Union Bank of (Nig) Plc [1995] 4 NWLR (pt. 338)  173

[128]  Op cit

[129]  Ibid, section 9(3)

[130]  Ibid

127  Entering into Contracts Electronically: The Real W.W.W. Andrew D. Murray, accessed 28/8/2012.

128  Op cit

129  Evidence Act, 2011 (Nigeria) Sections 258 and Section 84.

130   Electronic Communication Act, 2003(UK) Section 8

A discussion on the applicability of ILO standards on unfair dismissal cannot be appreciated without an understanding of the background, problems, scope, objective and significance the study as well as meaning of contract of employment as unfair dismissal is a phenomenon in contract of employment.

1.1 Background of the Study

The law and practice of determination of contracts of employment in Nigeria is employer friendly. The employer is free to determine the contract of employment of his employee for bad reasons or for no reason at all. This is in contradistinction with the law and practice across the world. This shows that the law and practice of determination of contracts of employment differ with those of other countries. This difference is occasioned by the fact that some countries across the world have moved away from the common law position that permits an employer to determine the contract of employment of his employee for bad or for no reason at all. The move away from this common law position started with the International Labour organisation which adopted ILO Termination of Employment Recommendation and ILO Termination of Employment Convention 158 of 1982. About 36 countries of the world have ratified the Convention while about fifty five countries both those who have ratified the Convention and those who have not ratified the Convention have embraced the provisions of the Articles of the Convention which contains ILO standards on unfair dismissal. Despite this effort by the International Labour Organisation towards ensuring a policy of fair dismissal, Nigeria is still in full practice of the common law termination at the will of the employer.

            The factors accounting for Nigeria’s failure to embrace this well-meaning convention containing ILO standards on unfair dismissal are the provisions of the Constitution of Federal Republic of Nigeria 1999 as amended requiring ratification and domestication of treaties and conventions before they can be enforced in Nigeria. None application of the convention containing ILO standards on unfair dismissal leaves Nigeria with practices which are unfair in the global perspective. This research work appraises the law and practice in Nigeria on determination of contracts of employment. It analyze termination and dismissal situations in Nigeria to see their status when tested against ILO standards on unfair dismissal, appraises the roles of the three Arms of Government of Nigeria in ensuring the application of this Convention containing ILO standards on unfair dismissal. The work also shows the extent of conformity with ILO standards on unfair dismissal by some countries.

1.2 Statement of Problem

 Issues bordering on determination of contract of employment take domination position in labour and industrial relations. Unfair dismissal is one of the problems plaguing employees in developing countries like Nigeria. Unfair dismissal practices have put employees in Nigeria in a bagger has no choice situation. Nigeria has remained under the common law determination at the will of employer.

Nigeria as a dualist state is under constitutional impediments which hinder Nigeria from embracing the International Labour Organisation standards on unfair dismissal. The attitude of the Nigerian Constitution on the application of International Labour Organisation standards on unfair dismissal in Nigeria is another major problem hindering from implementing the ILO standards on unfair dismissal. The role of the three arms of government on the application of ILO standards on unfair dismissal in Nigeria also leaves much to be desired. The step taken by the Legislature in Nigeria towards ensuring that international treaties and conventions are applied in Nigeria as provided in the Constitution of Federal Republic of Nigeria (Third Alteration) Act, 2010 is surrounded with controversy. These factors have made it difficult for Nigeria to apply the ILO Convention containing the ILO standards on unfair dismissal. None application of this ILO Convention containing the ILO standards on unfair dismissal accounts for Nigeria’s failure to achieve a policy of fair dismissal.

1.3 Objective of Study

The researchers set out to showcase the sources of ILO standards on unfair dismissal, the bases of determination of contracts of employment in Nigeria. The work is to make a conceptual clarification of the law on termination and dismissal, wrongful and unlawful termination and dismissal, classification of contracts of employment. Study the International Labour Organisation standards on unfair dismissal of an employee viz-a-viz the practice of termination and dismissal of an employee at the will of the employer. Undertake an appraisal of ILO standards as well as unfair dismissal situations in Nigeria. Showcase solutions to the common law and constitutional impediments to the applicability of ILO standards on unfair dismissal in Nigeria.  And finally to find out ways through which Nigeria can bring down the ILO Convention on termination of Employment No 158 of 1982 wherein the ILO standards on unfair dismissal are provided.

1.4 Significant of the Study

The importance of this research work is in the fact that the research is an informed agitation through an academic work for Nigeria to embrace the modern of law and practice of policy of fair dismissal. It shows by way of an appendix the extent of conformity of about 55 countries that have embraced the Convention containing the ILO standards on unfair dismissal.

            The work also undertakes a conceptual clarification of the terms ‘Termination and dismissal’ and the attendant consequences that attach to them. It clarifies the meaning of wrongful termination, unlawful termination, wrongful dismissal and unlawful dismissal and the remedies available to a victim of any of them. The researchers undertake an analysis of the ways through which the three Arms of Government of Nigeria saddled with the responsibility of ensuring that the Convention containing ILO standards on unfair dismissal becomes applicable in Nigeria without any impediments. The researchers made far-reaching recommendations that will enable Nigeria actualize the policy of fair dismissal.

1.5 Methodology

The researchers adopt analytical comparison using statute books, case law, text books, journal articles (local and international), Internal materials, unpublished works, international instruments. The work is broken into six chapters with three appendixes.

1.6 Literature Review

Determination of contracts of employment is a term encompassing termination and dismissal. A lot of literatures have been done on determination of contracts of employments locally[1] and internationally[2]. However, on the concept of unfair dismissal, there is a dearth of literature as the concept is novel in the Nigeria labour and employment jurisprudence.[3]

An attempt was made by Abagu[4] to appraise ILO standards on unfair dismissal. However, the work did not go to extent of untying the impediments in the constitution and the three Arms of Government of Nigeria on the application of the Convention containing ILO standards on unfair dismissal. This work therefore covers up that gap as it tries to analyze the factors inhibiting a hitch-free application of the Convention containing ILO standards on unfair dismissal and recommending possible way out of the predicament. The work also shows the extent of conformity with the ILO standards on unfair dismissal by about 55 countries across the world.

1.7       Meaning of Contract of Employment             

The term ‘contract of employment’ is made up of two key words: ‘contract and employment’. Apart from the definitions of the term in various labour law legislation and judicial definitions one can still derive the meaning of the term contract of employment by looking at the meaning of these two words that make up the term. A contract is defined as an agreement which the law will enforce or recognise as affecting the legal rights and duties of the parties.[5]

            A contract is an agreement whereby a person undertakes for rewards (consideration) to perform an act for another.[6] From the above definitions, it is clear that in a contract, there must be two or more parties who will undertake to perform an act for another for  purposes of receiving a reward called consideration and the agreement to do this must be such that is sanctioned by law. Where this agreement is recognised by law, one can safely say that the agreement with other elements in place has metamorphosed into a contract. That is while every contract must be an agreement but not all agreements are contracts.[7]

Also Garner[8]defines a contract as an agreement between two or more parties creating obligations that are enforceable or otherwise recognizable at law. The underlying principle in this definition is that any agreement which does not create obligations recognizable at law is not a contract. It is also pertinent to ascertain the meaning of the rest of the key word which is employment. Employment is defined as a relationship between a master and a servant.[9]

            From the foregoing therefore, contact of employment can then be defined as a relationship which exists between an employer and an employee which the law recognizes as giving rise to a legal obligation between the employer and the employee which said obligation is enforceable at law. The Labour Act[10] defines contract of employment to mean any agreement whether oral, or written, express or implied whereby one person agrees to employ another as a worker and that other person agrees to serve the employer as a worker. Implicit in this definition by the Labour Act[11] is that a contract of employment may be entered orally without the necessity of writing. This is however subject to some statutory exceptions such as the requirements of writing in a contract of apprenticeship.[12] This exception as provided in section 50 of Labour Act[13] provides that:

Every contract of apprenticeship and every assignment thereof shall be in writing; and no such writings shall be valid unless attested by and made with the approval of an authorized labour officer certified in writing under his hand on the contract or assignment.

What the section of the Act[14] depicts is that notwithstanding the general definition of contract of employment in the section of the Labour Act,[15] the Act itself provides a statutory exception to the effect that a contract of apprenticeship cannot be oral but in writing. It is also worthy to point out here that a contract of employment may also be by implication of law, without parties agreeing on the terms and conditions of the contract but because they have acted overtime on an employment relationship exchanging the necessary indices of employment, the law will imply employment relationship between them. The court has also defined contract of employment thus:

The Labour Act Cap 198 laws of the Federation of Nigeria (now cap L1 LFN 2004) which applies to workers, strictly to the exclusion of the management staff, defines a contract of employment as any agreement, whether oral or written, express or implied, whereby one person agrees to employ another as a worker and that other person agrees to serve the employer as a worker.[16]  

Save the addition of the fact that the Labour Act that gives the above definition applies to workers strictly to the exclusion of management staff; the above definition is merely a judicial restatement of section 91 of Labour Act.[17] On the form of contract of employment and whether it can be inferred, the Court of Appeal per Orji Abadua stated that:

Contract of employment may be in any form and it may be inferred from the conduct of the parties, it can be shown that such a contract was intended although not expressed. Contract of employment may arise out of agreement which is not enforceable in the law Courts because it lacks consideration.[18]

Notwithstanding the advantage the employer has over the employee and the predicament which the employee is put into in such situations, the common law recognises the interest of the employee amidst his ‘beggar-has-no choice situation’ immediately the employee agrees to enter into such relationship with the employer. A Contract of employment is built around two parties or better still it is created by two parties called the employer and the employee. It is now pertinent to ascertain who qualifies as an employer as well as an employee.

1.8       Definition of Employer and Employee

The terms ‘employer’ and ‘employee’ are normally used interchangeably with ‘master’ and ‘servant’ respectively. Employee is also sometimes referred to as a worker or a workman. What this means is that different people, and different laws use any of the above words to describe one of the parties in a contract of employment who agrees to work for another as a worker. This also explain why different statutes define the terms ‘employer and employee’ in accordance with the circumstances of the legislation in question.

            However, labour laws prefer employer and employee or worker.[19] Who then is an employer and worker or employee? The answer to this poser can be rightly gleaned from the various labour laws. By section 91 of Labour Act,[20] An employer means any person who has entered into a contract of employment to employ any other person as a worker either for himself or for the service of any other person and includes the agent, manager or factor of that first – mentioned person and the personal representatives of a deceased employer. The Employee’sCompensation Act[21]defines employer to include any individual, body corporate, federal, state or local government or any of the government agencies who has entered into a contract of employment to employ any other person as an employee or apprentice. The above definitions, it must be noted are for the purposes of the application of their respective Acts. The definition of employer in the Employee’s Compensation Act, appears to be more comprehensive as it lists the persons who are qualified as employers to include governments at all levels, departments and agencies of governments at all levels and by the opening word of the section, it means that so many persons and institutions not mentioned are also qualified to be employers once they enter into a contract of employment in any form. The labour Act[22] defines a worker to mean:

Any person who has entered into or works under a contract with an employer whether the contract is for manual labour or clerical work, or is expressed or implied, or oral or written, and whether it is a contract of service or a contract to personally execute any work or labour.

The Employee’s Compensation Act[23] prefers the word employee and defines employee thus:

Employee means a person employed by an employer under oral or written contract of employment whether on a continues, part-time, temporal, apprenticeship or casual basis and includes a domestic servant who is not a member of the family of the employer including any person employed in the federal, state and local Governments, and any of the government agencies and in the formal sectors of the economy.

This definition as all encompassing as it may look is meant for the purposes of the Employee’s Compensation Act which can be gleaned from the objective of the Act.[24] Section 1 of the Act[25]provides thus:

The objectives of the Act are to:

(a) Provide for an open and fair system of guaranteed and adequate compensation for all employees or their dependents for any death, injury, disease or disability arising out or in the course of employment;

(b). Provide rehabilitation to employees with work related disabilities as provided in the Act;

(c). establish and maintain a solvent compensation fund managed in the interest of employees and employers;

(d). provide for a fair and adequate assessment for employers;

(e) Provide an appeal procedure that is simple, fair and accessible, with minimal delays, and

(f) combined efforts and resources of relevant stakeholders for the prevention of workplace disabilities including the enforcement of occupational safety and health standards.

A careful look at these objectives of the Employee’s Compensation Act will show why the Act gave an all encompassing definition of who falls under the definition of an employee to be entitled to the benefits of the Act. The judicial sanction of the opinion of the researchers is made manifest by the fact that the definition of the word employer or employee or worker in judicial authorities are merely judicial restatements of the provisions of  the relevant labour law legislation in the light of facts and circumstances of a case at hand. In Shena Security Co. Ltd v Afropak (Nig.) Ltd[26]  the Supreme Court of Nigeria stated as follows on the meaning of a worker:

‘A worker is defined by the labour Act, Cap 198 Laws of the Federation of Nigeria 1990 impari material with Cap L1 LFN 2004 as any person who has entered into or works under a contract with an employer whether the contract is for manual labour or clerical work, or is expressed or implied, or oral or written and whether it is a contract of service or a contract personally to execute any worker labour. Such a contract is commonly referred to as a contract of service.’

There is a prevalent difficulty inherent in attaching a precise meaning to the terms. This is why different statutes try to obviate the problems by defining the terms for purposes of their provisions. It then means that the meaning of worker in the labour Act[27] is purely for the purpose of the Act. Implicit in this, is that all rights and liabilities in the provisions of any Act can only accrue to a person who has qualified as a worker or employee in accordance with the provisions of the Act in question. It is pertinent at this juncture to note that, certain categories of employees are statutorily under the provisions of the labour Act as against other labour legislation. A careful insight into the provisions of labour Act aforesaid seems expedient. Section 91 (a-f) of labour Act[28]  provides that:

Worker means any person who has entered into… but does not include-

(a) any person employed otherwise than for the purposes of the employer’s business, or

(b) persons exercising administrative, executive, technical or professional functions as public officers or otherwise; or

(c) members of the employer’s family; or

(d) representatives, agents and commercial travelers in so far as their work is carried on outside the permanent work place of the employer’s establishment; or

(e) any person to whom articles or materials are given out to be made up, cleaned, washed, altered, ornamented, finished, repaired or adapted for sale in his own home or on other premises not under the control or management of the person who gave out the articles or the material; or

(f) Any person employed in a vessel or aircraft to which the law regulating merchant and shipping or civil aviation applies.     

By the tenor of the above provision, certain persons are excluded from the operation of the Labour Act. Paragraph (a) of the section excludes domestic services which are necessarily incidental to effective performance of the work of an employee. The wisdom behind paragraph (b) of the section can be ascertained from the fact that these administrative, executive and technical officers in the public service may have different statutes regulating their employment while civil servants in the strict sense of the words have their employment regulated by civil service Rules.[29]

            One important point that is clear in the statutory exclusions is that those mentioned are outside the ambit of the provisions of the Labour Act. It is imperative here to point out that the Act cited above[30] dispenses with the terms master and servant which have the privilege of being the only recognized and used terms that refer precisely to the employment relationship of contract of service as against contract for service where the servant is actually not a servant but the so called independent contractor. However, the Act still leaves untouched the scope of master and servant relationship and as well widens the scope.

1.9       Contract of Service Distinguished from Independent Contractor

Employment may give rise to a number of relationships. A person may be employed as an employee or an independent contractor or as an agent.[31] There are different consequences attached to each relationship which makes a distinction of the relationships expedient. The essence of the distinction between an employee and an independent contractor in a contractor of employment are as follows:

(a) To know when the common law implied duties inherent in a contract of employment will become applicable.[32] 

(b) Secondly, the common law doctrine of vicarious liability is confined to the relationship of employer and employee. An employer may be held liable for a tortuous act committed by his employee in the cause of employment.[33]

(c) Thirdly the various labour statutes do not apply generally to those who are not employees at common law[34] and those who are not covered by a statute cannot in any circumstance claim under that particular labour statute as employee. In other words, there must of necessity exist between the employer and the employee or worker a master servant relationship.[35] Despite the existence of master and servant relationship between the employer and the employee, a worker claiming under the labour Act must show that he is covered by the Act.[36]

            Having ascertained the importance of the distinction between contract of service and contract for service otherwise called independent contractor, and that an employee in the former is regarded as a servant while an employee in the latter is regarded as an independent contractor, the task now is the difficulty in arriving at a proper status of an employee. This difficulty has been prevalent over the years leading the courts to evolve certain criteria for distinguishing an employee in contract of service and one who merely enters into a contract to personally execute work or service. These criteria or rules are referred to as the test for ascertaining a servant. They include the:

  1. Control test.
  2. Organisation test
  3. Multiple tests
  4. The modern approach.

A cursory glance at these tests is of necessity and they shall consequently be taken seriatim:

1.9.1    Control Test

The control test is the original or traditional test. It is also referred to as the superintendent test. Under this test, an employee is a servant if he is subject to the control of the employer as to the manner of doing his work.[37] However, the control factor can be overshadowed by other non-employment factors such as the non-employment factors introduced in Ready mixed Concrete (South East) Ltd v Minister of Pension and National Insurance.[38] Examples of non-employment factors include situations where an employee is paid by way of fees, where an employee is allowed to delegate his duties, where an employee is to invest and provide capital for the work to progress and where no office accommodation and secretary is provided by employer. This means that whether or not an employer controls the manner the employee does his work, there must exist factors showing the existence of contract of employment.

1.9.2    Organisation Test

This is also known as integration test. It was propounded by Lord Denning L.J. (as he then was) in Cassidy v Minister of Health.[39] This test arose out the inadequacies of the control test in view of the sophistication of modern industrial establishments as well as high level of professionalism and skill of modern day employees. Modern day employees have acquired high level of technological knowhow that the employer may not be in a position to control the manner in which the employee does his work. The organization test even though did not destroy the control test, allows the employee some level of freedom from control, yet the employee remains the employee of the employer irrespective of the fact that the employer has no control over him as to the manner he shall do his work. Under this test, it becomes less difficult to assign a status to a professional or an expert employee because a professional or an expert employee is required to use his initiatives to perform his work assigned to him.

            Yet this type of employee is still regarded and considered as a servant according to Lord Denning because he is employed as part and parcel of an establishment and his work is done as an internal part of the business.[40] According to Lord Denning:

One feature which seems to run through the instances is that under a contract of service, a man is employed as part of a business and his work done as an integral part of the business, whereas under a contract for service, his work, although done for the business is not integrated into it but is only accessory.[41]

It must be noted that the reason employers are still liable for any tort of their employees in such cases is not because the employer controls the manner in which the work is done, for they have no sufficient knowledge to do so but because they employ the staff and have chosen them for the task and have in their hands the ultimate sanction for good conduct and the power of dismissal.[42] The organization test did not in any way or manner displace the control test; rather it merely improved the control test to cover perceived difficulties in cases of experts and professionals. To arrive at a conclusion that one is a servant of a master the two tests must be considered.[43]

1.9.3    The Multiple Tests

There exists a glaring difference between the organisation test discussed above and the multiple tests. Organization test merely widened the scope of the control test to accommodate professionals and experts without actually destroying the control test. Multiple tests posit that the organization inherent in employment is shown by multiple factors apart from control. Such factors include time of work, provision of working tools, holiday and gratuity or pension benefits. The multiple tests envisage that in any particular circumstance where two or more elements of employment point consistently to one direction or another such may determine whether there exists a contract of service or contract for service.[44] It is important to state here that parties cannot by simply attaching a different label to their contract, alter the true nature of their contractual relationship under the common law.[45] However, where the nature of the relationship is ambiguous and there exist an agreement whether oral or written showing intention of the parties, the agreement will be decisive on what the nature of the contract is.[46]The application  of the multiple tests occurred in the Supreme Court case of Shena Security Co. Ltd v Afropak (Nig) Ltd[47] where the appellant supplied the respondent with security personnel for a fee on monthly bases and there existed agreement as to period of notice for each party to terminate the agreement. The respondent terminated the relationship contrary to the parties’ agreement and the Court held that, where there is a dispute as to what kind of contract of employment parties entered into, there are factors which will usually guide the Court of law in arriving at a right conclusion. For instance:

(a) if payments are made by way of ‘wages’ or ‘salaries’, this is indicative that the contract is one of service. If it is a contract for service, the independent contractor gets his payment by way of ‘fees’. In a like manner, where payment is by way of commission only or on the completion of job that indicates that the contract is one for service.

(b) where the employer supplied the tools and other capital equipment, there is strong likelihood that, the contract is that of service. But where the person engaged has to invest and provide capital for the work to progress that indicates that it is a contract for service.

(c) In a contract of service/employment, it is inconsistent for an employee to delegate his duties under the contract. Thus where a contract allows a person to delegate his duties there under, it becomes a contract for service;

(d) where the hours of work are not fixed, it is not contract of service;

(e) It is not fatal to the existence of a contract of service/employment that the work is not carried out on the premises of the employer. However, a contract which allows the work to be carried on outside the employer’s premises is more likely to be contract for services;

(f) where an office accommodation and a secretary are provided by the employer, it is a contract of service/employment’

The modern approach to this issue renders intention of the parties not as paramount as  the common law may seem to make it. This is because the modern approach is concerned with the elements in existence in the parties’ contractual relationship as against what they intended. The modern approach finds support from the case of Ready Mixed Concrete (South East) Ltd v Minister of Pension and National Insurance[48] wherein Mackenna Jeshethen suggested that a contract of service exists if the following conditions are fulfilled:

a) The servant agrees that in consideration of a wage or other remuneration he will provide his own work and skill in the performance of some services for his master;

b) He agrees, expressly or impliedly, that in the performance of the service he will be subject to the other’s control in a sufficient degree to make that other his master; and

c) The other provisions of the contract are consistent with its being a contract of service.

            In addendum to the criteria for ascertaining the appropriate status of a worker or servant Corker J. held in the case of Market Investigation Ltd v Minister of Social Society[49]that:

The fundamental test to be applied is this: ‘is the person who has engaged himself to perform these services performing them as a person in business of his own account? If the answer is ‘yes’, then the contract is a contract for service. If the answer is ‘no’ then the contract is contract of service. No exhaustive list has been compiled and perhaps no exhaustive list can be compiled of consideration which are relevant in determining that question, nor contract rules be laid down as to the relative weight which the various considerations should carry in a particular case.

The most that can be said is that, control will no doubt always have to be considered, although it can no longer be regarded as the sole determining factor and factors which may be of importance, are such matters as to whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk he takes, what degree of responsibility for investment and management he has and whether and how far he has an opportunity of profiting from sound management in the performance of his task.[50]  

The importance of the above is that the two above stated factors or test of control and organisation are mere guides and cannot be decisive as the modern approach is the consideration of all the facts and circumstance of a particular case to see whether sufficient employment factors present are consistent and point to one direction, that is, the direction of a contract of service, otherwise the employee becomes or is deemed an independent contractor. This is the current legal position on the issue of ascertainment of the requisite legal status of an employee as against an independent contractor. It must be borne in mind that the essence of this jurisprudential insight into the factors for ascertaining the requisite legal status of a worker or employee is to know who will be covered by this work in the event of cases of determination of employment and dismissal.  Who can claim that his dismissal or termination of employment was unfair and may want to make recourse to ILO standards on unfair dismissal. Better still to ascertain those covered by the contractual relationship sought to be protected by ILO standards on unfair dismissal.

1.10     Classes of Employees

Employment relationship between an employer and an employee is based on contract. It is a relationship which assumes equality between the parties[51] and thus does not create any superior right beyond what the contract of employment provides.[52] It is important to note that under Nigeria labour law jurisprudence, contract of employment does not in any way create collective interest or right. This point was made clearly in the case Bosah v Julius Berger Plc[53] wherein the Court held that:

In the realm of master and servant relationship, even though ten or more persons are given employment the same day under the same condition of service, the contract of employment is personal or domestic to each. In the event of breach, the persons do not have a collective right, to sue or be represented in the suit.

This however, does not reflect the position in the public sector[54] It is also important to note that the position aforesaid does not accord with the current trend of the law to do justice to parties. The current position of the law permits the bringing of action in a collective capacity.[55] It is also my submission that despite the position in the cases of Bosah v Julius Berger Plc[56] and Co-operative & Commercial Bank (Nig) Plc v Rose[57] fundamental rights actions emanating from labour and employment relationship can be brought collectively by virtue of the jurisdiction now conferred on the National Industrial Court.[58] The discourse under this subchapter is important for purposes of knowing the categories of employees in Nigeria to whom the international labour organisation standards on unfair dismissal apply.

1.10.1  Domestic Servant

The Labour Act[59] defines a domestic servant as any house, stable or garden servant employed in or in connection with the domestic services of any private dwelling house, and includes a servant employed as a driver of a privately owned or used motor car. This definition does not or rather the Act does not give the definition of domestic service thereby allowing the meaning to be derived in accordance with the facts and circumstances of individual cases in the light of the common law rules. Domestic servants are mainly engaged to be about their employer’s persons for purposes of ministering to their needs, including the needs of those who are members of their employers’ family or their guests. They are engaged under contract of personal service.

            In Olaniyan v Unilag[60]  Oputa J.S.C. (of blessed memory) noted that in this type of contract personal pride, personal feelings, personal confidences and confidentiality may all be involved. The consequence of this class of employment is that the employee is only entitled to reasonable notice to enable the employee terminate the contract of employment. The employer can terminate at will with reasonable notice or salary in lieu of notice. In Todd v Kerrick,[61] it was held that a governess could not be treated as a domestic servant entitling her only to the customary one month notice of termination of service available to that type of menial employment. Also in Wilson v Uccelli,[62] it was held that a private tutor is not a domestic servant. A domestic servant is not also entitled to fair-hearing. However, the position under the common law cannot override the agreement of the parties irrespective of the nature of the work the employee is employed to do particularly where the relevant employment factors present as was decided in the Supreme Court case of Shena Security Co. Ltd v Afropak (Nig) Ltd[63]  are present.

1.10.2  Office Holder

At common law, persons who do not fit into the definition of servants but nevertheless enjoy the inherent advantages in the consequences of employment are referred to as office holders. The rationale for this, is that a holder of an office is usually not under a contract to personally execute any work for any person and his employment is not necessarily one of contract of service, rather holding office, he is entitled to a hearing before termination of his appointment and if he is wrongly removed from office, the court will order his reinstatement upon his application.

In Great Western Railway v Bater,[64] Rowlatt J. defined an office as follows:

A subsisting, permanent, substantive position which had an existence independently from a person who filled it, which went on and was filled in succession by successive holders.[65]

According to Emiola, a residual office holder may be defined as:

A holder of an office of emolument attached to an institution or institutional office, the appointment of which is vested in a person or body of persons who or which does not come within the legal definition of ‘master’ at common law or ‘employer’ under any statute.[66]

An office holder ordinarily does not qualify to be an employee as there is no employer who engaged him in that relationship. Rather he is occupying an office but enjoys the consequences inherent in an employment. The position according to Emiola is that the appointment of a resident office holder can be made or determined only in accordance with the custom of the office or the established procedure laid down specifically for that purpose.[67] The importance of office holding lies in the remedy available at common law to a holder who is wrongfully removed from office.[68] Two consequences however attach to the tenure of employment of an office-holder.

            Firstly, the power to remove an office holder is generally subject to the rules of natural justice.[69] This presupposes that an office-holder must be given adequate time and facilitates to make his representation in reaction to the allegation against him before he will be removed and he must also be given an opportunity to be heard. A holder of an office is not under any contract to personally execute any work for another and his employment is not necessarily one of contract of service but by virtue of holding an office, he has certain rights which entitles him to a hearing before dismissal and if he is wrongfully removed from office, the Court will on the application of the aggrieved employee make an order of reinstatement.

 1.10.3 Private Sector Employee

This category of employees hitherto applies to employer-employee relationship regulated purely by the contract agreement of the parties without more. This operates mostly in private sector employment under Nigeria labour law jurisprudence where an employer who is referred to as the master is competent to “hire and fire” at will or without motive.[70]  This is the ordinary master-servant relationship and upon wrongful dismissal, an employee will be entitled to damages only and not order of specific performance.

1.10.4  Public Sector Employees

This is also another category of employees whose true status and nature had been erroneously perceived. These categories of employees are those employed either by the Federal, State or Local government or by statutory corporation or companies wholly owned or substantially owned and financed by any of the above tiers of government. Employees under this category are called public servants as defined in the Constitution.[71] Generally, the employment of employees in the public sector has statutory force.[72] It has been erroneously perceived that once a person is employed in the public service as defined by the Constitution, the person’s employment will acquire statutory protection. This is erroneous as public servants do not have the same contract of employment just because the constitution or statute classifies them as public servants. [73]

1.10.5  Employment with Statutory Flavour

These are employees whose contract of employment is regulated, either by the Constitution, statutes or civil service rules whether of the Federal Civil service or state civil service. An employee here is usually employed by an employer who is a creation of statute.[74] The implication of this class of employment is that the statute creating the employer protects the tenure of the employment of its employees by making statutory prescriptions which must be followed before any employee of that undertaken can be removed from his employment. The fact that an employer is a creation of statute does not ipso facto make his employee’s employment one with statutory flavour.[75] It is also instructive to note that the fact that an employee is in public office does not also automatically qualify his employment as one with statutory flavour.[76]

The Court had held that conditions of service which will give statutory flavour to a contract of employment cannot be a matter of inference. There must be conditions which are set out in a statute or regulation made pursuant to the statute.[77]Also on the meaning and nature of contract with statutory flavour, the Court in the case of Oluseye v Lawma[78] held that an employment with statutory flavour arises where the body employing the man is under some statutory restriction as to the kind of contract which it makes with its servants and the grounds upon which it can dismiss the employee. Where an appointment is regulated by statutory provision such an appointment is said to enjoy statutory flavour or protection.[79] Any other contract other than the ones regulated by statute or regulation made pursuant to a power derived from a statute is governed by the contract of employment of the parties.[80] From what has been said so far on contract with statutory flavour, one can decipher certain salient points such as the fact that for an employment to be regulated by statute or a regulation, it must be made pursuant to a power granted by a statute or a regulation made pursuant to a power derived from the statute. It is also important to note here that if the employment is regulated by a regulation made pursuant to a power derived from a statute, the said regulation will have the same force of law as the enabling statute under which it was made provided it does not conflict with the provisions of the enabling statute.[81]

1.11     Judicial Attitude to the Nature of Contract of Employment

Over the years, there have been persistent efforts by jurists to ascertain the precise criteria for determining who are actually employees and their exact status as well as the requisite legal classification of contract of employment. This is caused by the prevarication of the nature and status of employees vides judicial authorities based on statutory interventions.

            From the common law position on the criteria for ascertaining who a servant or worker is, one can see that the common law position placed emphasis on the ‘control factor’ which we have earlier discussed. From the control factor to the development of the organization test by Lord Denning (Master of Rolls), down to the multiple test which in tandem with the present modern approach which posits that once there are two or more employment factors pointing consistently to one direction, that is the direction of employment, the employee will be deemed a servant and such contract will be one of service and not for service. This modern approach was espoused in the case of Ready Mixed Concrete, (South East) Ltd v Minister of Pension and National Insurance.[82] The Supreme Court of Nigeria also lent credence to this development of the common law test of ascertaining a servant in the case of Shena Security Co Ltd v Afro Pak (Nig) Ltd.[83] The Supreme Court in this case enumerated a lot of factors which will guide a court in the determination of whether there exist a contract of service between parties or not. Such factors include provision of equipment, office accommodation, office secretary and where payment is salary and wages. The Court’s enumeration is indicative of the fact that the list is not exhaustive and there is no hard and fast rule for determining the existence of master-servant relationship. It also shows that each case will be decided based on its facts and circumstances. Therefore, the current attitude of Nigerian courts on the test of ascertaining whether an employee is a servant or an independent contractor is that the Court faced with such question will determine that question by searching for the existence of the employment factors and where two or more of the factors point consistently to the direction of contract of employment/service, the court will so hold.[84] As regards classification of contract of employment, judges have in the past classified contract of employment into domestic servant, master-servant relationship, office-holders and contract with statutory flavour.[85]

This classification which has been developed by judicial authorities particularly that of the Honourable Justice Oputa J.S.C. (of blessed memory) can be found in the case of Olaniyan v University of Lagos.[86] At this stage in the development of the classification of contract of employment, the Court’s attitude is to the effect that there exists a contract of employment wherein personal pride, personal feelings, personal confidence and confidentialities may be involved and such employee is termed domestic servant.[87]   Also there is another category wherein a person occupies a subsisting, permanent, substantive position which had an existence independent of the person who occupies the office and which went on and was filled by successive holders, the occupier here is termed office-holder while another category places emphasis on whether an employee is employed in a government owned establishment whether wholly or substantially owned or whether the employee is employed in a privately owned establishment. Before this time it was not certain whether employees at the state (i.e. government) were employed under a contract of employment.[88] The better view then was that servants of the state (Crown) were employed under contract but the crown could put an end to the contract at any time and for no reason and without any compensation for loss of job.[89] In the English Court of Appeal case of Dunn v Queen,[90] the Court stated that:

There must be imported into the contract for the employment of the petitioners the term which is applicable to civil servants generally, namely that the crown may put an end to the employment of its employees at its pleasure.[91]

This common law position was later given statutory support by the provisions of the then Pensions Act[92] which provided that nothing in the Act shall affect the right of the crown to dismiss any officer at any time without compensation.[93] This shows that at common law what was termed public employment was at the pleasure of the government. That is to say that public employees were servants in the strictest sense of the word. However, even at common law, the right of the crown to dismiss its employees at pleasure could still be negatived by law.[94] The position of public officers has however changed by virtue of section 6(6) b of theConstitution.[95] By virtue of the above section of the Constitution public officers can now sue the government for wrongful dismissal. This was followed in the case of Shitta-Bey v F.P. S.C[96] wherein the Supreme Court held that the employment of public servants[97] are regulated by Civil Service Rules and also statutes for those employed in government establishments other than government ministries and departments stricto sensu. In Oguche v Kano State Public Service Commission[98] Wheeler J. stated that:

It is now common ground, in the present case, that the public service regulations made under the now repealed (constitution) Order in Council 1954, originally published as NRLN 80 of 1960 and now published in vol. iv of the laws of Northern Nigeria, still regulates the procedure of the public service commission of Kano state… Reading these regulations, I am satisfied that they fetter the right of the state to dismiss its servants at will.[99]

This shows that the law has developed to the extent of the Constitution negativing the inhibition on the rights of the individual employee to sue the state as placed by the Petition of Rights Act.[100] It is also instructive to note that the development of the law as regards classification into public and private is of no moment by the current judicial attitude. This is because whether private or public, the current judicial attitude is to sec whether the particular contract of employment is protected by statute otherwise it will fall to the realm of ordinary master-servant relation.[101] In Registered Trustees, P.P. L.N. v  Shogbola,[102] the Court of Appeal Lagos Division held thus on types of contract of employment:

Contract of employment are of two types viz: simple contract of master and servant relationship under common Law and contract of employment with statutory flavour. In simple contractual relationship of master and servant, actions in damages lie for its repudiation or breach by wrongful dismisses, so that if an employer wrongfully dismissed the employee either summarily or by giving insufficient notice, employment is all the same effectively terminated. On the other hand, employment with statutory flavour is where the appointment and dismissal of an employee are regulated by a statute in which case some rights and obligations are given and imposed respectively, usually beyond the ordinary contract of employment. A declaratory relief coupled with damages could be granted if the requirement of the statute is not complied with.[103]

            But for the absence of office holders, I agree with the categorization above by the Court. However, in Ujam v I.M.T,[104] the Court stated that:

There are three types of employer/employee relationships with different consequences viz:

(a) under the common law where; in the absence of a written contract, each party could abrogate the contract on a week’s or one month’s notice or whatever the agreed period for payment of wages.

(b) where there is a written contract of employment between employer and employee, in such a case, the Court has a duty to determine the rights of the parties under the written contract.

(c)(i) public servants-where their employment is provided for in a statute and/or conditions of service or agreement.

(ii) Public servants as in the civil service.

The foregoing analysis of the judicial attitude to classification of contract of employment shows that judicial opinion on what a particular contract of employment is prevaricates and is devoid of exactitude. This is seen from the opinions of the justices of the superior courts who will at one time say that there are only two classes of contract of employment which are ordinary master servant relationship and contract with statutory flavour and at another time classify contract of employment into three which include public employee as a class divided into public employee whose employment are regulated by statute and public employee in civil service. I cannot but stand on the existing classification given by his Lordship Oputa J.S.C (of blessed memory) in Olaniyan v University of Lagos[105]  which is to the effect that a contract of employment is classified into domestic servants, office-holders, master-servant relationship and contract with statutory flavour.

            This concurrence of mine is influenced by the fact that what ought to determine a particular class of contract of employment is the procedure involved in the event of termination of the employment or dismissal of the employee as well as the remedies available in the event that an employee is wrongfully or unlawfully removed from his employment. What determines each class is also dependent on the contract of employment or the statute regulating the employment. The judicial attitude to the exact nature of a contract of employment has moved away from the class of employment hitherto referred to as private or public employment to now show that such classification of contract of employment is now of no moment. This is because the opinion of the Court at present is that contract of employment hitherto called private sector employment can either be an ordinary master-servant relationship or contract with statutory flavour. This is because where a statute regulates the appointment and removal of an employee in a private establishment such employee is said to have a contract with statutory flavour the fact of being in a private establishment notwithstanding. The Supreme Court decision in the case of Longe v FBN Plc,[106] made it clear that once there is a statute or regulation made pursuant to a statute which regulates employment of an employee, the employee’s contract of employment is deemed to be with statutory flavour.

         The point made above is that the fact that an employer is a creation of statute does not by that very fact make a contract of employment one with statutory flavour rather it must be shown that a statute regulates the particular employee either expressly or by necessary implication.[107] In the same vein, where an employee in a private sector has his employment backed by statute or regulations made pursuant to a statute, the employee’s employment is said to be with statutory flavour.[108] This class of employees in the private establishment whose employment is with statutory flavour is majorly seen in employment created pursuant to the provisions of Companies and Allied Matters Act.[109]

This is made manifest in the case of a director of a company incorporated under the Companies and Allied matters Act.[110]The removal of a director is regulated by section 262(1)[111] which provides that a company may by ordinary resolution remove a director before the expiration of his office notwithstanding anything contained in the articles or in the agreement between the company and the director. The effect of this provision is that even a person appointed as a director for life or as a permanent director by the articles or by agreement may nevertheless be removed by the general meeting, subject of course to his right to compensation if any.[112] The procedure statutorily prescribed by Companies and Allied Matters Act[113] is provided in section 262(2) of CAMA.[114] Where a director is removed in contravention of the provision of the Act, the purported removal is null and void and will be set aside. It is not an answer to plead the master’s common law right to dismiss an employee since there is a statutory provision for the removal.[115]

            From the above analysis, it is obvious that an employee director of a company registered under the Companies and Allied Matters Act can only be removed as provided in section 262 of CAMA.[116] This means that such employee director’s employment has statutory flavour since the director employee cannot be removed except as allowed by the Companies and Allied Matters Act and consequently any purported removal other than as permitted by CAMA will be null and void. When an act is void, it is in law a nullity and it is deemed not to have happened. This informed the reasoning of the Court in the case Longe v First Bank of Nigeria[117] wherein the Court held that a director whose contract of employment is terminated in contravention of the provision of the Companies and Allied Matters Act regulating the procedure for removal of a director is entitled to an order of reinstatement.

In effect, such a contract though in a private establishment is deemed to be with statutory flavour. What this then means is that where an employee in a private sector has his employment protected by statute or regulations made pursuant to a statute, such as the cases of director of a company,[118] secretary of a public company[119] and auditor of public company,[120] by prescribing statutory procedure which must be followed before such employee is removed the employee cannot be removed without compliance with the laid down procedure.[121] It is important to point out here that under the Banks and other Financial Institutions Act,[122] the Governor of the Central Bank of Nigeria is vested with the power to remove directors of banks without regard to the procedure laid down in CAMA.

In Longe v First Bank of Nigeria Plc[123], the appellant was elevated to the office of a managing director from the office of an executive director of the Respondent bank granted an unauthorized loan to a customer of the respondent. The respondent sought to remove the appellant for granting unauthorised loan contrary to the respondent’s banking policy. The respondent first suspended the appellant and thereafter convened a meeting where the appellant was removed by a resolution of the respondent. Notice of the meeting where the appellant was removed was not given to the appellant and the provisions of section 262 (1-3) of CAMA regulating the procedure for removal of a director of a company was not complied with. The appellant sued and pursued his suit to the Supreme Court and the Supreme Court held that:

By virtue of the combined effect of Sections 266 (1) and 262 of the Companies and Allied Matters Act, a director to be removed must be given a notice of the meeting where he is sought to be removed and the procedure prescribed in Section 262 of CAMA must be complied with otherwise the removal will be null and void and the director who is unlawfully removed will be entitled to Order of reinstatement.

The Court therefore ordered the reinstatement of Mr. Bernard Longe to his office in First Bank of Nigeria Plc which is a private sector employment. This is the most recent judicial attitude to private sector employment to the grant of order of reinstatement which was before now taken to be in the realm of mere master-servant relationship.

1.12     Formation of Contract of Employment

Contract of employment is a species of contract and governed by the general principles of contract.[124] These general principles of contract will be appraised in this subchapter. For a contract of employment to be validly formed, all the essential elements of a valid contract must be present. They include offer and acceptance, consideration, intention of parties to create legal relation, capacity of the contracting parties and legality of the contract.

There must be offer and acceptance which are in effect the contract between the employer and the employee in a contract of employment.[125] There must also be consideration which is the exchange of promises or actual performance of work on the part of the employee and payment of wages and salaries on the part of the employer. In offering and accepting a contract of employment, there must be consideration, unless the contract is made under seal. It is therefore, the law that consideration in a contract of employment is the salary and other fringe benefits which an employee earns on the one part and the services which an employer receives on the other part. This is why a contract of employment which is bereft of consideration is not enforceable in Law.[126]

Parties must also possess the requisite legal intention to enter into a contract of employment. One common category of contract of employment that has consistently been taken to lack intention to create legal relationship between employer and employee is a contract of employment which arose from a collective agreement.[127] Another essential element which must be present for a contract of employment to be said to have been validly formed is the requisite capacity of the contracting parties. Except in a contract of apprenticeship, no person under the age of sixteen years shall be capable of entering into a contract of employment as provided in section 9 (3) of Labour Act.[128] What this provision means is that a person under the age of sixteen years can validly enter into a contract of apprenticeship. It also shows that such contract of employment which the section prohibits a person under the age of sixteen years from entering into must be a contract of employment regulated by the Act.[129]

Another special class of employees with protection is women employees. Section 91 which is the definition section of the Labour Act[130] defines a woman to mean any member of the female sex, whatever her age or status at work. The protection granted to women employees under the Labour Act includes maternity protection, night work and underground work. With respect to maternity protection, working pregnant women enjoy protection in relation to maternity leave, maintenance benefits and security of employment. Apart from these elements, a contract of employment must not be tainted with illegality just like the principles of formation of contract generally. What this means, is that contract of employment is formed like any other contract and the basic principles of formation of contract apply to a contract of employment.

1.13     Formation of Electronic Contract of Employment

A discussion on the formation of contract of employment by electronic means is no longer an academic exercise; it is of so much importance for commercial consideration as electronic transactions are fast growing. People now enter into contracts including contracts of employment electronically. Employers of labour now find the Internet as a viable means of advertising vacancies which exists in their establishments and receive applications online as well as employ people without the necessity of the parties meeting physically.

E-contract of employment are usually concluded electronically by means of e-mail, telephone, telex and fax machines. There is no reason to suppose that the development of e-mail or the World Wide Web will affect the application of the current principles of law of contract though the internet raises unique technological issues when examining the formation of e-contract of employment.127 It is these technological issues that often times cloud our analysis of e-contract of employment.

1.14     Extant Laws on E-Contracts

The first question to be addressed with regard to e-contract is whether such virtual contracts are permissible by the current state of our Laws. If the question is resolved in the affirmative, we can then move on to complex issues of when is a contract of employment concluded electronically, its terms and regulatory laws. In Nigeria today, there is no law which specifically provides for electronic contracts including electronic contract of employment. Contracts concluded electronically are guided by the general laws on contracts simpliciter and the common law principles deducible from case law. It is also interesting to note that Nigerian Courts are yet to be faced with the issue of validity of an electronic contract of whatever class including electronic contract of employment.

Many contracts today are devoid of formalities, and as such may be concluded in writing, orally or electronically. Where contracts are required to be in writing or have some other form of formal requirement such as the attachment of a physical signature or attestation by witnesses to be effective, certain practices have been accepted as meeting such requirements especially for purposes of e-contracts. These formal requirements can no longer cause problems when the principles of e-contract are applied. Reference will usually be made to the Interpretation Act128 which defines writing as including typing, printing, lithography, photography and other modes of representing or reproducing word in a visible form.

The United Kingdom Department of Trade and Industry having recognized the place of e-contract and communication in the growth of the United Kingdom economy, recommended equivalence for electronic documents and for digital signatures as part of Electronic Communication Bill. This bill was later enacted as the Electronic Communication Act 2000. Equivalence is a commonly used method of integrating new systems or technologies into a developed legal system; this is a replacement of the function of a specific document or rule with a replacement which is deemed to be functionally equivalent to it. E.g. a written document may communicate information, provide a formal record and be used as evidence of the parties’ intentions. All the rules of the written document may be equally well met by the use of electronic documents particularly in the light of the new Evidence Act.129 Therefore, in such cases, an electronic contract may be the functional equivalent of a written document, and simply replacing the one with the other has no wider impact on the specific contractual/evidential rules of the system in question.

The United Kingdom Act130, unlike many of its counterparts, does not simply provide blanket equivalence for electronic communication. It instead empowers ministers to give full legal effect to electronic communication by sub-ordinate legislation.

1.15     Legal Status of Electronic Contract of Employment

An analysis of the legal status of a thing is a determination of whether the thing in question satisfies the legal requirements for its validity. In analyzing the legal status of e-contracts, we must bear in mind that electronic contract of employment is like any other contract, the only difference being that e-contract is negotiated and concluded electronically and in many cases the employee earns his or her salary without the necessity of the employer knowing him or her and vice versa.

E-contract of employment is a contract and for it to be valid, it must have embedded in it the elements of a valid contract which are offer, acceptance, consideration, intention to create legal relation, requisite legal capacity of the parties and legality of the contract. In actual reality, parties to a contract of employment see each other while negotiating and at the conclusion of the negotiation, if the parties are agreed to the terms, a contract is consequently formed, but in e-contract of employment though parties do not see each other, they negotiate online and agree on terms and a contract results from their agreement. Once there is an offer and acceptance and other conditions or constituents are present, the validity of an e-contract of employment cannot be questioned.

At present in Nigeria, there is no known legal regime regulating e-contract of employment. Nigerian courts will definitely fall back to the well known principles of law of contract to determine the rights and liabilities of parties to an e-contract of employment.


[1] E E, Uvieghara, ‘Labour law in Nigeria’ (Lagos: Malthouse Press Limited, 2001) ; C K, Agomo, National Justice and Individual Employment Law in Nigeria’s in Current themes in Nigeria Law,  Adegbe and  Akande (eds: 1997) ; A, Emiola, Nigerian Labour Law (4th edn, Ogbomoso: Emiola Publishers Limited, 2008) ; C, Nwagbara, Determination of Contract Employment and Remedies for Wrongful Dismissal, (Nigeria: Tait Publishers, 2000). S, Erugo, ‘Security of Employment in Nigeria: A Case for Statutory Intervention’, NJLIR Vol. 1 No. 1 (2007) p.60; F, Ojo, ‘Legal Redress for Unlawful Termination of Employment: It is Time to call A Spade A Spade’, NJLIR, Vol. 1 No. 3 (2007) P. 3; A O, Elias, ‘Summary Dismissal Upon Allegation of Crime-An Overview’, MRJFIL Vol. 3 No. 3 (2000) p. 134;

C K, Agomo, Nigeria Employment and Labour  Relation, Law and Practice,(Lagos: Concept Publications Ltd,2011); R K Salman ‘Concept of Dismissal and Natural Justice: An Essential Correlation’Vol. 2 No 2, UILJ, Vol. 2 No. 2 (2005); O, Ogunniyi, Nigeria Labour and Employment Law in perspective, (Ikeja: Folio Associates Limited, 1991); O K, Edu, ‘Dismissal upon Allegation of Crime in Nigeria: Need to comply with constitutional provision’. MRJFIL, Vol.10 Nos 3-4 (2006); E,  Chianu, Employment Law (Akure: Bemicov, Publishers Nigeria Ltd, 2004) ; O D, Amucheazi and E A, Oji, ‘Reinstatement of a Dismissed Employee in a contract of Employment; A case Review of  Longe v First Bank of Nigeria Plc’, NJLIR Vol. 4 No. 2 (2010).

[2]. M R, Fredland, The Contract of Employment (Oxford: Oxford University Press, 1976) ;  G, Janner, Janner’s Compendium of Employment Law, (London: Business Books Ltd, 1997) ; Gould, ‘The Idea of The Job as property in Contemporary America: The Legal and Collective Bargaining Framework’, Brigham Young University Law Review, p. 885

[3]  O, Animashaun, ‘Unfair Dismissal: A Novel Idea in Nigerian Employment Law’, NJLIR, Vol. 2 No. 1 (2008) p. 1.

[4]  E O,  Abugu, ‘ILO standards and The Nigeria Law of Unfair Dismissal’, AJICL Vol. 17 (2009) p. 181 – 212;  J E O, Abugu, Treatise on the Application of ILO Convention in Nigeria, (Lagos: University of Lagos Press, 2009.

[5]  I E, Sagay, Nigerian Law of Contract (2nd edn Ibadan: Spectrum Books Limited 2000)P. 1

[6]  C  E, Ibe, The Law of Contract in M N, Umenweke, et al, Commercial Law and Practice in

Nigeria, ( Enugu: Nolix Educational Publications Nig, 2009)

[7] I E, Sagay,  Nigerian Law of Contract, op cit; C E, Ibe, The Law of Contract in M N, Umenweke, et al, Commercial Law and Practice in Nigeria,, Ibid.

[8]  B A. Garner, Black’s Law Dictionary (8th Edn, St. Paul Minn: West Pub. CO; 2004) p. 341.

[9]  Ibid, p. 566.

[10]  Cap LI LFN, 2004 S. 91.

[11]  Ibid S. 91. 

[12]  Ibid S. 49.

[13]  Ibid.

[14]  Ibid.

[15]  Ibid.

[16]  Shena Security Co Ltd v Afrapak (Nig) [2008] 18 NWLR (pt 1118)  77 at p.84.

[17]  Op cit.

[18]  Johnson v Mobil  Prod. (Nig) Unltd [2010] 7NWLR (pt 1194)  471.

[19]  Labour Act, op cit S. 91, Trade Unions Act Cap T14 LFN, 2004, S. 54, Employee Compensation Act, 2010  S. 72; Trade Dispute Act Cap T8 LFN 2004.

[20]  Ibid.

[21]  Op cit S. 72

[22]  Op cit S. 91

[23]  Op cit. .Note that before the enactment of the Employees Compensation Act, the Workmen Compensation Act used the term workman instead of employee.

[24]  Ibid. S. 1

[25]  Ibid.

[26]  Supra  p. 82.

[27]  Op cit.

[28]  Ibid.

[29]  Ibid S. 91.

[30]  Ibid.

[31]  E E, Uvieghara, ‘Labour law in Nigeriaop cit  p.3.

[32]  At Common law the employer has duties and as well, the employee has his own duties which the parties owe to each in a contract of employment.

[33]   Iyere v B.F.M. [2003]18NWLR (pt 1119)  300.

[34]   Iyere v B.F.M, Supra

 [35] Atedoghu v Alade (1957) WNLR 84.

[36]  Olaja v Kaduna Textiles Ltd (1972) 2WLRI 1; Shena Security Co. Ltd v Afropack (Nig.) Ltd, Supra.

[37]  Jordan and Harrison Ltd v Macdonald & Evens (1952) 1LR 101. Yewens v Noakes (1886) 6 QBD530, 532-533; United Bank Ltd v Ajagu [1990]1NWLR (pt 328) 343.

[38]  (1960) 2 QB 497.

[39]  ( 1951) KB 343.

[40]  Jordan & Harrison Ltd v Macdonald & Evans Ltd Supra.

[41]  Cassidy v Minister of Healt,h Supra.

 [42] Cassidy v Minister of Health, Supra.

[43]  Westell Richardson Ltd v Roalson (1954) 2 All ER 440.

[44]  Murren v  Swinton and Panddlebury Borough  Council (1965) ALL ER 349; Ready Mixed concrete (South East) Ltd v Minister of Pension and National Insurance, Supra.

[45]  Farguson v John Dawson & Partners (Contractors) Ltd (1978) 1NLR 1213.

[46]  Murren v Swinton Supra

 [47] Supra

[48]  Supra.

[49]  (1963) 3 All ER 732 Supra.

[50]  Market Investment ltd v Minister of Social Society, Supra.         

[51]  C K, Agomo, National Justice and Individual Employment Law in Nigeria’s in Current themes in Nigeria Law,  Art. cit  p.95.

[52]  Chukwuma v  S.P.D.C. (Nig.) [1993]4 NWLR (pt. 289 ) 512; Daniels v  Shell B.P. Petroleum Development Co.  (1962) 1 ALL NLR 19. Abaruonye v  University College Hospital, Ibadan (1959) WNLR 232; Obo v Commissioner of Education, Bendel State (2001) 9WRN 1.

[53]   [2005]15 NWLR (pt. 948)  414; See also Co-operative & Commercial Bank (Nig.) Plc v Rose [1998] 4NWLR (pt 544) .37 C.A.

[54]  C K, Agomo, Nigerian Employment and Labour Relations Law and Practice (Lagos: Concept Publications  Ltd,2011)  59.

[55]  See the preamble to the Fundamental Human Rights (Enforcement Procedure) Rules 2009 which now allows actions for enforcement of fundamental Rights to be brought in a representative capacity.

[56]  Supra

[57]  Supra.

[58]  Constitution of Federal Republic of Nigeria (3rd Alteration Act) 2010 S. 254 (C) and Preamble to the Fundamental Rights (Enforcement Proceeding) Rules, op cit.

[59]  Op cit S. 91.

[60]  [1985]2NWLR (pt. 9)  98.

[61]  (1852) 8 Exch. 152.

[62]  (1929) 45 TLR, 395.

[63]  Supra.

[64]  (1923) KB 266 at p. 274.

[65]  Ridge v Baldwin (1964) A.C. 40, at pp. 65-66.

[66]  A, Emiola, Nigerian Labour Law (4th edn, Ogbomoso: Emiola Publishers Limited, 2008) p. 28.

[67]  Igbe v  Governor Bendel State & Anor (1983)3NCLR 273.

[68]  Ridge v Baldwin Supra.

[69]  Natural Justice consists of two essential principles audi alterm parten and nemo Judex in causa sua.

[70]  Okomo oil palm Plc v Iserhienrhieh [2001] 6NWLR (pt. 710) 660; Adeniji v Governing Council Yabatech [1993] 6NWLR (pt. 300)  426; Steyer (Nig). Ltd v Gadzama [1995]7NWLR (pt 407)  305.

[71]  CFRN op cit S. 318(1); see also the Interpretation Act Cap I23 LFN 2004, S. 18(1); Shittta-Bay v F.P.S.C (1981) SC 46; Iderima v R.S.C.SC [2005)16NWLR (pt 951) 378;F.C.S.C. v Laoye [1989] 2 NWLR (pt. 106)  652.

[72]  CFRN, op cit S. 318(1).                       

[73]  Iyase v University of Benin Teaching Hospital Mgt. Board [2000]2NWLR (pt 643)  45 at 58; Isioviore v NEPA [2002]7NWLR (pt. 784) 417

[74]  For instance employees of educational institution in Nigeria.

[75]  Ujam v I.M.T. [2007]2NWLR (pt. 1019)  476 at p.477

[76]  Fakuade v OAUTH [199]5NWLR (pt. 291)  47 at p.490. Haruna v  Uniagric, Makurdi [2005] 3NWLR (pt. 912) 233 at p.246.

[77]  Ujam v U.M.T. Supra; Idoniboye – Obu v  NNPC [2003]2NWLR (pt. 805)  589; U.M.THMB v Dawa [2001]16 NWLR (pt. 739)  424; Power Holding Company of Nigeria v Offoelo[2014]3 ACELR 1-39

[78]  [2003] 17NWLR (pt. 849)  309-310.

[79]  Oluseye v Lawma Supra.

[80]  C.B.N. v Igwilo [2007]14 NWLR (pt. 1054) 396. See also Evans Bros (Nig) Pub. Ltd v Falaiye [2003] 13NWLR (pt.  838)  570; Salami v New Nigerian Newspapers Ltd [1999]13NWLR (pt. 634)  315.

[81]  Osadebay v A.-G., Bendel State [1991] NWLR (pt 169)  525.

[82]  Supra, see also Market Investigations Ltd v  Minister of Social Society Supra.

[83]  Supra.

[84]  Shena Security Co Ltd v Afro Pak (Nig) Ltd, Supra.

[85]  Oputa (J.S.C of blessed memory) in Olaniyan v University of Lagos. Supra  

[86]  Olaniyan v University of Lagos, Supra

[87]  Great western Railway v Bater Supra.

[88]  Railly v The King (1934) AC 176; Okonkwo v P.S.C Anambra State (1981) 2 PLR 359.

[89]  E E,  Uvieghara, ‘Labour Law in Nigeriaop cit p. 17.

[90]  (1896) 1 QB 116.

[91]  Dunn v Queen, Supra

[92]  Cap 147 LFN 1958.

[93]  Ibid S. 6(1).

[94]  E E, Uvieghara, ‘Labour law in Nigeriaop cit p. 17.

[95]  1979, and 1999 as amended.

[96]  Supra.

[97]  Which includes civil servants

[98]  (1974) 1 NMLR 128.

[99]  . Oguche v Kano State Public Service Commission, Supra p 135.

[100]  Cap 149 LFN, 1958.

[101]  A-G, Kwara State v  Ojulari [2007]1NWLR (pt 1061)  551 Daodu v  UBA Plc [2004] 9 NWLR (pt 878) 276 at p.278.

[102]  [2004]11NWLR (pt 883) 3.

[103]  Registered Trustees, P.P. L.N. v  Shogbola Supra; see also UBN Ltd v Ogboh [1995]5NWLR (pt 380) 647  Isioeveore v NEPA, Supra

[104]  Supra 476.

[105] Supra

[106]  [2010] 6 NWLR (pt 1189)  1                                                                                                                                                      

[107]  UMTHMB v  Dawa, Supra, p 424; Azenabor v  Bayero University Kano [2009]17NWLR   (pt. 1169)  100; (UNTHMB v  Nnoli [1994] 8 NWLR (pt 362) 374.

[108]  Longe v First Bank of Nig. Plc, Supra.

[109]  Cap C 20 LFN 2004.

 [110]  CAMA Ibid.

[111]  CAMA Ibid.

[112] J O, Orojo, Company Law and Practice in Nigeria (5th edn, Royet & Day Publications Ltd, 2008) p. 254; N C S, Ogbuanya, Essentials of Corporate Law Practice in Nigeria. (Ikoyi: Novena Publishers Ltd, 2010) p. 379; CAMA op cit S. 262(6).     

[113]  Op cit.

[114]   Ibid.

[115]  J O, Orojo, Company Law and Practice in Nigeria, op cit p. 255; See also Iwuchukwu v Nwizu [1994] 7 NWLR (pt. 251)  379

[116]  Op cit.

[117]  Supra.

[118]  CAMA op cit S. 262 (1-6).

[119]  Ibid s. 296 (1-4).

[120]  Ibid S. 357.

[121]  Longe v  First Bank Plc Supra.

[122]  Cap B3 LFN, 2004 S. 35 (182)

[123] Supra

[124]  Nwobosi v ACB [1995] 6 NWLR (pt. 404) p. 655

[125]  Appleby v Johnson (1874) 9 L.R 158; Agomo v Guiness (nig) Ltd [1995] 2 NWLR (pt. 38) 672 to the effect that there must be offer and valid acceptance to the offer before a contract of employment can be validly formed. See also Ajayi Oba v Executive Secretary, F.P.C.N. (1975) 3 SC  1

[126]  Ajayi v R.T. Briscoe (Nig) Ltd (1962) ALL NLR 673

[127]  Ford Motors Co. Ltd v Amalgamated Union of Engineering and Foundry Workers (1962) 2 GB 303; A.C.B. v Nwodika [1996] 4 NWLR (pt. 404)  658; Shauibu v Union Bank of (Nig) Plc [1995] 4 NWLR (pt. 338)  173

[128]  Op cit

[129]  Ibid, section 9(3)

[130]  Ibid

127  Entering into Contracts Electronically: The Real W.W.W. Andrew D. Murray, accessed 28/8/2012.

128  Op cit

129  Evidence Act, 2011 (Nigeria) Sections 258 and Section 84.

130   Electronic Communication Act, 2003(UK) Section 8

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