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Termination of employment is a critical aspect of labour law in Nigeria that is governed by the contractual relationship between employer and employee. Courts have consistently delineated the boundaries of this relationship, emphasising adherence to contractual terms and the principle of reasonableness. Below, we explore this topic using notable cases to illustrate a few key principles.

1. Employer's Right to Terminate

In ISIEVWORE v. NEPA (2002) LPELR-1555(SC), the Supreme Court reaffirmed the employer's right to terminate employment for good, bad, or no reason, provided the contractual terms are followed. This decision underscores the sanctity of employment contracts and the limited role of courts in probing employers’ motives unless contractual breaches occur.

2. Reasonable Notice in Termination

The courts emphasize reasonable notice for termination where contracts are silent. In IMOLOAME v. WAEC (1992) LPELR-1500(SC), the court held that the required notice depends on the nature of the contract and the employee's status. Higher-ranking employees, given their responsibilities and remuneration, are entitled to longer notice periods. This principle is supported by KUSAMOTU v. WEMABOD ESTATE LTD (1976) LPELR-1720(SC), where the court highlighted the variability of reasonable notice based on specific circumstances.

3. Retrospective Termination

Retrospective terminations are generally impermissible. In UNDERWATER ENGINEERING CO. LTD & ANOR v. DUBEFON (1995) LPELR-3379(SC), the court ruled that employment continues until the actual date of termination. Attempting to backdate termination breaches employees’ rights to earned remuneration during the intervening period.

4. Contractual Stipulations and Reorganization

Employment contracts may include clauses addressing organizational restructuring. In SPDC (NIG) LTD & ORS v. NWAWKA (2003) LPELR-3206(SC), the court held that if a contract specifies that a job should be found for an employee post-reorganization, such provisions must be enforced. Absent such terms, an employee's remedy lies in wrongful termination claims if contractual obligations are unmet.

5. Master-Servant Relationships

The master-servant doctrine remains a cornerstone of Nigerian labour law. As seen in IDUFUEKO v. PFIZER PRODUCTS LTD & ANOR (2014) LPELR-22999(SC), courts uphold employers' rights to terminate employment with appropriate notice or reasonable compensation. Employees cannot claim entitlement to specific retirement ages unless explicitly stipulated in their contracts.

6. Legal Remedies for Inadequate Notice

When termination occurs without requisite notice, employees are entitled to damages equivalent to the notice period's earnings. The decision in OSISANYA v. AFRIBANK (NIG) PLC (2007) LPELR-2809(SC) clarified this remedy, affirming that courts will award compensation reflective of the unfulfilled notice period as stipulated in the contract.

7. Judicial Non-Interference with Motives

Employers’ motives for termination are often irrelevant if contractual obligations are met. In FAKUADE v. O.A.U.T.H. COMPLEX MANAGEMENT BOARD (1993) LPELR-1233(SC), the court noted that motives behind lawful termination fall outside judicial scrutiny. This principle protects employers’ managerial discretion while ensuring contract compliance.

8. Reasonableness and Industry Standards

The determination of reasonable notice often considers industry practices and the employee's role. In KUSAMOTU v. WEMABOD ESTATE LTD (1976) LPELR-1720(SC), the court stated that factors like professional customs and employee rank influence what constitutes reasonable notice, serving as a guide for equitable resolutions.

9. Employment Contracts as the Legal Bedrock

Courts consistently emphasize that employment contracts govern the terms of termination. In IDUFUEKO v. PFIZER PRODUCTS LTD & ANOR (2014), it was reiterated that courts would enforce contractual provisions strictly while considering statutory and common law safeguards for fairness.

10. Dismissal and Antecedent Misconduct

Termination for prior misconduct must align with procedural fairness. The court in UNDERWATER ENGINEERING CO. LTD v. DUBEFON highlighted the impropriety of retrospective dismissals for known misconduct without timely action, protecting employees' rights to due process.

11. Contractual Ambiguities and Judicial Interpretation

Ambiguities in employment contracts often require judicial interpretation to align with fairness and reasonableness. In IMOLOAME v. WAEC, the court demonstrated its role in inferring reasonable terms, such as notice periods, where contracts are silent.

12. Termination During Probationary Periods

Probationary contracts often include discretionary termination clauses. However, in KUSAMOTU v. WEMABOD ESTATE LTD, the court stated that even discretionary powers must adhere to principles of reasonable notice, protecting employees from arbitrary dismissals.

13. Organizational Restructuring and Employee Rights

Reorganizations present unique challenges. The court in SPDC v. NWAWKA stressed that contractual terms explicitly addressing post-reorganization redeployment bind employers, safeguarding employees against undue termination during structural changes.

Procedural Safeguards in Dismissals

Dismissals must comply with procedural fairness, especially in cases involving alleged misconduct. Courts have underscored the importance of adhering to contractual and statutory procedures before terminating employment.

The legal framework governing employment termination in Nigeria seeks to balance employers’ managerial discretion with employees’ contractual and statutory rights. Judicial precedents provide clarity on contentious issues, ensuring fair treatment while respecting the sanctity of contracts. However, employers and employees alike must be vigilant in crafting clear and enforceable contracts to minimize disputes.