The Employment Law Year 2022: A Review of Significant Developments in Labour and Employment Law

0

2022 was another active year in the labour and employment law space, defined by industrial actions and threats of industrial action, especially the 8-month strike embarked upon by the Academic Staff Union of Universities (“ASUU”), as predicted in last year’s edition of this publication. We also witnessed the #HorribleBosses trend which exposed toxic workplaces and unfair labour practices, as well as the ingraining of the coinage “Japa” into our labour lexicon to describe the massive emigration of labour, especially the youthful workforce, out of Nigeria.

In terms of regulatory oversight, the Ministry of Labour invoked its powers under the Labour Act to issue guidelines regulating contract employment in the banking and other financial institutions sector. A similar flurry of regulatory activity was witnessed in the pensions industry with the release of several guidelines relating to the investment of pension funds, the use of retirement savings balance for residential mortgages, and the processing of retirement and other terminal benefits. The legal profession was not left out with the release of the Nigerian Bar Association’s (“NBA”) white paper on the remuneration of legal practitioners.

In employment litigation, the National Industrial Court of Nigeria (“NICN”) decision in The Shell Petroleum Development Company of Nigeria Ltd v. The Minister of Petroleum Resources & Ors[1] validating the Guidelines for the Release of Staff in the Nigerian Oil and Gas Industry 2019 has drawn much attention. This decision came barely a year after the decision of the court in Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) & 3 Ors v. Chevron Nigeria Limited[2], which invalidated the same guidelines. We also saw landmark decisions on liability for racial harassment in the workplace and the award of exemplary damages for wrongful termination of employment contracts.

On the global scene, Nigeria ratified the International Labour Organisation’s (“ILO”) Violence and Harassment Convention, 2019 (No. 190) as well as the Promotional Framework for Occupational Safety and Health Convention, 2006 (No. 187), thereby cementing the country’s place as a forward looking jurisdiction in adopting international labour standards. Public and private employees also experienced enhanced benefits from the legislative enactment of a new health insurance legislation.

We present a synopsis of these developments as we look ahead to 2023

INDUSTRIAL DISPUTES

ASUU Industrial Action and the Registration of Congress of Nigerian University Academics

In last year’s edition of this publication, we predicted a strike action by ASUU given the temporary truce between the union and the Federal Government of Nigeria (“FGN”) with regard to the unresolved demands of ASUU over its members’ conditions of service among other issues. What no one could predict was the length of the industrial action or the recognition of a rival union. On 14th February 2022, ASUU embarked on a warning strike which culminated in an eight-month-long strike to press home its demands.[3]

In a plot twist widely perceived to be an attempt to weaken the influence of ASUU, the FGN registered a new academic union – Congress of Nigerian University Academics (“CONUA”) which had previously not been recognised by the government as a trade union. The FGN also filed an action against ASUU at the NICN to bring an end to the strike and obtained an interlocutory injunction restraining ASUU from continuing the strike action. The court order forced ASUU to suspend its eight-month-long strike on 14th October 2022, even though it has appealed the order.

Strike Threats by the Nigerian Police Force, Nigerian Correctional Service and Electricity Sector Workers

There were several threats by workers in occupations statutorily barred from embarking on strike. In March 2022, it was reported that members of the Nigerian Police Force (NPF) threatened to embark on an indefinite strike over the FGN’s non-implementation of the new salary plan and lack of sophisticated weapons to fight crime. Nine personnel of the NPF suspected to be leaders of the planned strike were eventually dismissed from the NPF. At the same time, the Inspector-General of Police promised to implement a new salary structure for the NPF.

In the same March, Nigerian Correctional Service officers threatened to strike over poor wages and working conditions. However, this strike did not commence. Sometime in May, electricity workers under the platform of the National Union of Electricity Employees (NUEE) issued a 14-day strike notice to the management of the Transmission Company of Nigeria (TCN) over unresolved issues relating to the promotion of workers.

EMPLOYMENT LITIGATION

Validity of the Guidelines for the Release of Staff in the Nigerian Oil and Gas Industry 2019 – The Shell Petroleum Development Company of Nigeria (“SPDC”) v. The Minister of Petroleum Resources & 2 Ors[4]

On 28th July 2022, the NICN, considering the application of the Guidelines for the Release of Staff in the Nigerian Oil and Gas Industry 2019 (“Guidelines”), upheld the validity of the Guidelines to employers in the Oil and Gas sector. The position of the law in previous cases like PENGASSAN & 3 ors v. Chevron Nigeria Limited[5] was that the Minister of Petroleum (“the Minister”) did not have the powers to regulate private employment contracts between parties as this is in consonance with the age-old principle of sanctity of contracts. Also, the powers of the Minister, as outlined in the Petroleum Act (“PA”), did not contemplate such regulations as contained in the Guidelines.

However, the NICN in this case upheld the provisions of the Guidelines, relying on the new Petroleum Industry Act, 2021 (“PIA”). The NICN held that there is a marked difference between the powers of the Minister under the PA and the new PIA. Under the PIA, the Minister has the powers to formulate, monitor, and administer government policy in the petroleum industry, and the NICN held that these powers are wide enough to accommodate the Guidelines. Therefore, the Guidelines are within the powers of the Minister.

Understandably, this decision has generated fresh conversations in the oil and gas industry over the impact of the Guidelines on contractual freedom and operational ease in the industry. The judgment is already on appeal, and it will be good to have the Court of Appeal give the final word on this issue, especially in the face of another decision of the NICN in Prime 127 v. Minister of Petroleum Resources[6] invalidating the Guidelines just six days before the decision in this case.

ALSO READ   My Grouse: The CJ's Directive; To Registrars or Learned Brothers?

Punitive Damages Awarded for Wrongful Termination of Employment – Abdul-Hakeem A. Olasewere v. Airtel Networks Limited.[7]

The claimant in this case was an employee of the defendant telecommunications company where he held the position of V.P Operations and Support, and during the period of his employment, had a stellar career with several promotions under his belt. He challenged the termination of his contract of employment, which he alleged was due to malice by the company’s CEO and his exposure of wrongdoing within the company. The company in its defense contended that the claimant’s employment was terminated in accordance with the terms and conditions of his engagement and that movement of staff within the establishment is a routine and regular practice.

In its judgment, the NICN held that the termination of the Claimant’s employment is wrongful and without any justifiable basis since no reason was given. The court also awarded NGN100,000,00 (one hundred million Naira) in favor of the claimant as exemplary damages in addition to two years’ salary in the sum of NGN60,000,00 (sixty million Naira) as general damages for the wrongful termination.

While this case continues the recent trend of the NICN declaring as wrongful any termination of contracts of employment without reason, it is particularly remarkable for the quantum of damages awarded. The reason given by the court for the award, i.e., the malicious nature of the termination and the company’s failure to investigate the allegations of abuse of office raised by the claimant during the disciplinary process, which was not considered before termination – is one that employers must watch out for in reviewing their disciplinary procedures.

Revision of Judicial Officers’ Remuneration – Chief Sebastian Tar, SAN v. National Assembly & 3 Ors [8]

The Claimant, a Senior Advocate of Nigeria, filed this action at the NICN seeking to compel the National Assembly to amend the Certain Political, Public, and Judicial Office Holders (Salaries and Allowances, Etc.) (Amendment) Act No. 1 of 2008 with a view to reviewing the salaries of judicial officers upwards in line with current socio-economic realities. According to the Claimant, he aspires to be appointed either as a Justice of the Supreme Court of Nigeria, Justice of the Court of Appeal, or a Judge of the High Court but is discouraged by the poor salaries and allowances paid to judicial officers in Nigeria.

In its judgment delivered on the 15th of July, 2022, the Court found that the last upward review in the salaries of Judicial Officers was carried out in 2008 (14 years ago). The Court made an order of mandatory injunction compelling the Revenue Mobilisation Allocation and Fiscal Commission (“RMAFC”), Attorney General/Minister of Justice, as well as the National Judicial Council to put in place or activate legal and administrative machinery to commence payment of enhanced salaries to Judicial Officers ranging from N7million – N10million. The practicality of this judgment remains to be seen. However, the Chairman of RMAFC announced on the 1st of December, 2022, that the Federal Government has begun efforts to give effect to the judgment.

Racial Abuse and Harassment in the Workplace – Cheick Ouedraogo v Uber Technologies & Ors[9]

In the first known decision of the NICN outlawing racial abuse in the workplace, the court was called upon by an employee of Uber Technologies Nigeria Limited (“Uber”) to decide if being called ‘Drogo’, an adulteration of the Claimant’s real surname ‘Ouedraogo’, by his manager, amounted to harassment and racial abuse. The Court, in its judgment delivered in May 2022, held that unwanted jokes, like that in this case, amounted to harassment and racial abuse. Also important is the finding made by the court that Uber retaliated when the employee complained about the abuse by terminating his employment. Damages were awarded accordingly.

This case is one of the few under Nigerian law where the issue of harassment (apart from the sexual type) is decided. It is a reminder to employers that they have several duties when it comes to violence and harassment in the workplace, including:

  1. Creating (and implementing) a workplace policy on harassment;
  2. Taking complaints of workplace harassment very seriously and being seen to have taken firm action to walk the talk embedded in the policy;
  3. Having zero tolerance for retaliation towards employees who make a complaint of workplace harassment; and
  4. Training and retraining employees on what constitutes harassment and violence in the workplace.

LEGISLATIVE AND REGULATORY INTERVENTIONS

Enactment of the National Health Insurance Authority Act 2022

On 19th May 2022, the National Health Insurance Authority Act 2022 (“NHIA Act”) was signed into law, repealing the National Health Insurance Scheme Act (“NHIS Act”)[10]. The NHIA Act makes health insurance mandatory for every person resident in Nigeria. Residents under the NHIA Act include all employers and employees in public and private sectors with five staff and above, informal sector employees, and all other residents of Nigeria. The NHIA Act requires an employer to register itself and its employees under the scheme and pay contributions into the account of the States Social Health Scheme Funds in respect of its employees as may be specified by the State health insurance scheme laws and guidelines.

Similar to the NHIS Act, contributions under the scheme are not outlined in the NHIA Act but are to be determined by the Governing Council. Section 31(1)(a) of the NHIA Act states that contributions under the formal sector are to be paid by employers and employees at rates to be determined by the Governing Council of the various State health insurance schemes. The NHIA Act, however, permits a voluntary supplementary or complementary private health insurance plan for individuals or employers.

ALSO READ   NWLR This Week: Visiting Error of Counsel on Litigant, Rules, Exceptions, Applications

Ratification of the Promotional Framework for Occupational Safety and Health Convention, 2006 (No. 187) and Violence and Harassment Convention, 2019 (No. 190)

On 8th November 2022, Nigeria ratified the Promotional Framework for Occupational Safety and Health Convention, 2006 (No. 187) (“Occupational Safety Convention”). The Occupational Safety Convention, which comes into effect, twelve months after ratification by the member country, seeks to promote continuous improvement of occupational safety and health to prevent occupational injuries, diseases, and deaths by developing a national policy, national system, and national programme. This national policy, system, and programme are to be done in consultation with representative organisations of employers and workers.

Nigeria also ratified the Violence and Harassment Convention, 2019 (No. 190) (“Violence and Harassment Convention”) on 8th November 2022. Similar to the Occupational Safety Convention, the Violence and Harassment Convention comes into effect twelve months after ratification by the member country. The Violence and Harassment Convention, which applies to all sectors, whether private or public, both in the formal and informal economy and urban or rural areas, seeks to protect workers and other persons in the world of work. These persons include employees as defined by national law and practice, as well as persons working irrespective of their contractual status, persons in training, including interns and apprentices, workers whose employment has been terminated, volunteers, job seekers, and job applicants, and individuals exercising the authority, duties or responsibilities of an employer.

The Violence and Harassment Convention defines “violence and harassment” in the world of work as a range of unacceptable behaviours and practices or threats, whether a single occurrence or repeated, that aim at, result in, or are likely to result in physical, psychological, sexual or economic harm, and includes gender-based violence and harassment. “Gender-based violence and harassment” is also defined as violence and harassment directed at persons because of their sex or gender or affecting persons of a particular sex or gender disproportionately, and includes sexual harassment.

Guidelines on Labour Administration Issues in Contract Staffing/Outsourcing, Non Permanent Workers in Banks, Insurance and Financial Institutions.

On 8 September 2022, the Federal Ministry of Labour and Employment (“the Ministry”) issued the Guidelines on Labour Administration Issues in Contract Staffing/Outsourcing, Non-Permanent Workers in Banks, Insurance and Financial Institutions (“the Guidelines on Labour Outsourcing”) pursuant to the powers of the Minister of Labour under section 88 (e & g) of the Labour Act, Cap L1, LFN 2004.[11]

These Guidelines require that every category of employees be given opportunities for self development and growth in their career path. The career path shall take the following paths:

  1. Annual salary increment for all categories of employees;
  2. Non-permanent employees shall have the opportunity for career advancement/promotion within two years, but not later than three years, based on defined organisational criteria; and
  3. Non-permanent employees who meet company recruitment standards may be given an opportunity for regular employment where vacancies exist in line with the Principal’s recruitment standard.

It also provides for unionisation, disciplinary procedures, compliance with standards and labour requirement, exit procedure, and benefits. The issuing of these Guidelines follow a similar one that the Ministry issued to regulate contract staffing in the oil and gas industry in May 2011[12]. The objective of the Guidelines on Labour Outsourcing is clearly to provide a legal framework for the prevalent practice of contract staffing and should bring some certainty and regulation to this field.

Guidelines on Accessing Retirement Savings Account (RSA) Balance Towards Payment of Equity Contribution for Residential Mortgage by RSA Holders

In a bid to give effect to the provisions of Section 89(2) of the Pension Reform Act, 2014 (“PRA”), which allows Retirement Savings Account (RSA) holders to utilise part of their retirement savings as equity contribution for residential mortgages, the National Pension Commission (PenCom) on 23rd of September, 2022 released the Guidelines on Accessing RSA balance towards payment of equity contribution for residential mortgages by RSA holders.

By the guideline, an RSA Holder is entitled to apply for a maximum of 25% of their total RSA balance as equity contribution for a residential mortgage. A list of 34 approved Primary Mortgage Institutions has been released by PENCOM to implement these Guidelines. It is expected that this move will increase the chances of workers at home ownership and also benefit the mortgage industry.

PENCOM Revised Regulation on the Administration of Retirement and Terminal Benefits

In March 2022, PenCom issued the Revised Regulation on the Administration of Retirement and Terminal Benefits (“the Revised Regulation”). The purpose of the Revised Regulation is to establish a uniform set of rules, procedures, and standards in relation to the application of relevant sections of the PRA, to be adopted by the pension fund administrators for the administration of retirement and terminal benefits under the Contributory Pension Scheme. The Revised Regulation also covers the Micro Pension Plan (MPP) participants, with contributions made under the MPP divided into contingent and fixed portions available for withdrawal and fixed for retirement.

A notable change in the Revised Regulation is the timeframe for presuming a missing contributor dead. It provides that where an employee is missing, the employer or next of kin/legal beneficiary of the missing person shall notify the PFA of the disappearance after a minimum period of twelve months. This is notable because under Sections 164 (1) and 259 of the Evidence Act, 2011, the presumption of death of a missing person is seven years. We expect this conflict to be resolved by a judicial pronouncement sometime in the future.

Nigerian Bar Association Releases White Paper on Remuneration in the Legal Profession

The Remuneration Committee of the Nigerian Bar Association (“NBA”) released a White Paper to improve the welfare conditions of lawyers in the country after the poor working conditions of lawyers in Nigeria became a front-burner issue. The Report recommended a system of remuneration of lawyers based on their location, categorised into four bands according to the six geopolitical zones in Nigeria. Band 1 includes Lagos and Abuja; Band 2 includes South-West and North-Central States; Band 3 includes South-South States, and Band 4 includes South-East, North-West, and North-Eastern States of Nigeria.[13]

ALSO READ   LawPavilion Digital Transformation Webinar Holds May 20

The Federal Ministry of Interior Revised Handbook on Expatriate Quota Administration

The Federal Ministry of Interior revised its Handbook on Expatriate Quota (EQ) administration in Nigeria. The Handbook, among other provisions, provides that the total lifespan of EQ grants for companies has been reduced from ten (10) years to seven (7) years. The initial grant period remains three (3) years, renewable biennially for two consecutive terms of two (2) years each, within a lifespan of seven (7) years. However, for companies in the oil and gas sector, EQ is now only valid for four (4) years. That is, approval will be for an initial period of 2 years and renewable once for another two (2) years.

2023: A LOOK-AHEAD

The Possible Passage of the Bill to Regulate the Employment of Informal Sector Employees in Nigeria

A Bill to end the casualisation of domestic workers, interns, apprentices, and other informal sector employees in Nigeria passed second reading at the Senate on 29th September 2022. If passed, the Bill titled “Informal Sector Private Employment Agencies (Regulation) Bill, 2020” would protect the rights of, regulate and formalise the employment of informal sector employees in Nigeria. Considering the important nature of this Bill, we anticipate that the National Assembly will pass it into law in 2023.

ASUU Strike and Related Litigations

We expect judgment to be delivered in early 2023 in the suit filed by the FGN in Federal Government of Nigeria & Anor v. Academic Staff Union of Universities (ASUU)[14] regarding the legality of the strike embarked upon by ASUU.

Meanwhile, ASUU and CONUA are currently embroiled in a dispute with the FGN over the implementation of the ‘No Work No Pay’ policy for the period of the strike, with CONUA and ASUU already announcing that they may be taking legal action against the FGN. If this is followed through, we might have new case law on the No Work No Pay policy with specific reference to the tertiary education sector.

Whether these litigations will resolve the disruptive strikes in the tertiary education sector remains to be seen. In the interim, further agitations and industrial action cannot be ruled out, with some university branches of ASUU already embarking on street protests and class boycotts.

Possible Enactment of the Unpaid Wages Prohibition Act

The House of Representatives recently passed a Bill, “An Act to Prohibit Late Payment, Underpayment of Workers’ Wages, Pension and Other Emolument in Nigeria and Prescribes for Violations and for Related Matters” (“the Bill”). The Bill, currently undergoing second reading at the legislative house, seeks to prohibit late and non-payment of workers and pensioners by employers and the unfair deduction of wages and salaries by employees for unjust reasons. The various durations of breaches in payment of wages and salaries and respective penalties are set out in the Bill, with a penalty of up to 30% of such wages. Where the breach is in respect of other monetary benefits apart from monthly wage and monthly pension, the penalty shall be 30% of such monetary benefits for the period.


Written by:

  1. Victoria Agomuo – (General Editor) Associate, Udo Udoma & Belo-Osagie
  2. Ademayowa Ogunmola – ED, Corporate and Legal Services, DPL Construction Limited
  3. Titilola Olatunde-Fasogbon -Senior Associate, Udo Udoma & Belo-Osagie
  4. Precious Udoma– Associate, Morgan Jibromah & Co.
  5. Mohammed Adediji – Associate, Pinheiro LP
  6. Similoluwa Daramola – Associate, Ernst & Young, Nigeria
  7. Quadri Adewole – Associate, Banwo & Ighodalo

This is a publication of The Employment and Labour Lawyers Association of Nigeria (ELLAN). It is only for informational purposes and is not intended to be legal advice. Enquiries about this publication and ELLAN should be sent to ellannigeria@gmail.com.


Footnotes

[1] Unreported Suit No. NICN/ABJ/178/2022

[2] 2 Unreported Suit No: NICN/LA/411/2020

[3] 3 Some of ASUU’s demands, as stated in our previous publication, include:

Full implementation of the 2009 Federal Government of Nigeria (FGN)/ASUU Agreement as renegotiated in 2021. b. The implementation of all outstanding provisions in the February 2021 FGN/ASUU Memorandum of Action. c. The immediate deployment of ASUU’S preferred human resource management software, called the University Transparency and Accountability Solution (UTAS). d. Immediate payment of outstanding Earned Academic Allowances (EAA) and promotions arrears. e. Immediate release of the report of the Presidential Visitation Panels to federal universities in 2021. f. Immediate action on the recommendations of the Committee on State Universities.

[4] Supra

[5] Supra

[6] Unreported Suit No NICN/LA/182/2021

[7] (Unreported) Suit No. NICN/LA/90/2014

[8] 8 (Unreported Suit No. NICN/ABJ/142/2022)

[9] Unreported Suit No. NICN/LA/424/2020

[10] Cap N42, Laws of the Federation of Nigeria (“LFN”) 2004

[11] The Guidelines on Labour Outsourcing apply to:

  1. The Principal, defined as all Nigerian employers in Banks, Insurance and Allied Institutions;
  2. Labour recruiters defined as institutions registered to offer labour recruitment services;
  3. Non-permanent worker defined as any employee supplied or outsourced by a labour recruiter or a third party to the Principal; and d. Permanent workers who are defined as all employees who are directly employed or remunerated by the Principal.

[12] Guidelines on Labour Administration Issues in Contract Staffing /Outsourcing in the Oil and Gas Sector 2011

[13] The recommended remuneration by the Committee is as follows.

Category of Lawyers Band 1 Band 2 Band 3 Band 4
0-4 YPC 120,000 112,000 95,000 83,000
5-10 actual work experience (30% increase from the standard wage for lawyers between (0-4 YPC) 156,000 146,000 124,000 108,000

[14] 14 (Unreported Suit No. NICN/ABJ/270/2022)

LEAVE A REPLY

Please enter your comment!
Please enter your name here