Termination of Employment in Nigeria

termination of employment

One of the notable cases on the termination of employment in Nigeria was between Airtel and Abdul-Hakeem Olasewere. On the eve of Christmas 2013, Airtel Nigeria dismissed one of its employees, Abdul-Hakeem Olasewere who was the VP, Operations and Support in the company. He claimed to have received a letter in November 2013 to the effect that he has been reassigned to the role of VP, Special Projects Site Optimisation which according to him was a reduction in rank and responsibility.

After holding several meetings and conducting investigations, the company terminated the employment without giving Mr. Olasewere adequate information on why he was dismissed and the opportunity of fair hearing.

In its defence the company argued that it is not under any contractual obligation to disclose the reasons, cause or basis for terminating the contract of employment of Mr. Olasewere. The company also claimed that the role the employee was assigned was not a demotion or disciplinary action against him. The National Industrial Court held that the termination of Mr. Olasewere’s contract of employment was wrongful and therefore awarded damages against Airtel.

This article considers the termination of employment in its entirety viz-a-viz, the grounds for termination, who can terminate and the precautions to be followed when terminating employment with statutory flavour.

Meaning of termination of employment

This refers to the process of bringing an end to the employment relationship between an employer and employee. The termination could be done either voluntarily or involuntarily. Voluntary termination of employment occurs when the employee terminates his employment with a company. It could be done willingly, especially in cases where the employee got a new job, decides to take a career break or for other reasons whatsoever. It could also be done as a result of constructive dismissal where the employee is advised to resign and receive the benefits attached.

Involuntary termination occurs when the contract of employment is terminated or the employee is dismissed by an employer for whatsoever reason.

Who can terminate the contract of employment?

The two parties to a contract of employment, that is the employer and employee, both enjoy the privilege of terminating a contract of employment. This is one of the major differences between the termination of employment and dismissal, in which case only an employer is able to dismiss the employee.

In situations where the employment relationship is governed by a contract of employment, there is usually a provision for the notice period that each party ought to give before the contract of employment can be validly terminated. Where a party fails to meet the required notice period, there is usually a provision for payment in lieu of notice in the contract.

Grounds for termination of contract employment

The general position under private employment is that an employer has the right to hire and fire an employee for any reason or no reason at all. This implies that the employer need not inform the employee of the reason for the termination of employment. This was the major argument of Airtel in the case stated above. The telecoms giant contended that it has no duty to inform the employee of the reason for terminating his employment.

This has been the position of the court in numerous cases such as the case of Osisanya v. Afribank Nigeria Plc and Obanye v. Union Bank. In the latter case, Kekere-Ekun JSC of the Supreme Court stated that an employer has the right to hire and fire and is entitled to terminate for good or bad reason or for no reason at all; provided that the firing must be done in accordance with the terms and conditions of the employment. This implies that the only condition required for termination of employment is the issuance of the requisite notice.

However, the National Industrial Court of Nigeria in the exercise of its jurisdiction under the Constitution of the Federal Republic of Nigeria has applied international best practices to require employers to give reason for terminating an employee, and such reasons should be valid.

In the case of Bello Ibrahim v. Ecobank Plc, the Claimant’s employment was terminated after he was promoted to the position of Country Head, Segment and Analysis. The letter of termination given to the Claimant only disclosed that his service was no longer required, without any reason for the termination. The National Industrial Court of Nigeria held that based on Article 4 of the Termination of Employment Convention 19825 (No. 158), there is a minimum international best practice that requires an employer to provide valid and justifiable reasons for terminating the employment of a worker.

Similarly, in the case of Aloysius v. Diamond Bank Plc, the Claimant claimed that his employment was wrongfully terminated by his employer. The Court while giving its judgment stated that, “It is now contrary to international labour standard and international best practice and, therefore, unfair for an employer to terminate the employment of its employee without any reason or justifiable reason that is connected with the performance of the employee’s work.”

It can be said that the NICN frowns at the practice of firing an employee for any reason or no reason at all. Rather a valid reason should be given for the termination to be effective.


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Termination of employment with statutory flavour.

Unlike private employment, employments with statutory flavour enjoys a different form of protection under the law. The Court stated in the case of Eksu & Ors V. Fajembola & Ors that, “An employment is said to have a statutory flavour when the appointment and the determination is protected by statute or laid down regulations made to govern the procedure for employment and discipline of an employee….”

In order to effectively terminate an employment which falls under this category, there must be a strict observance of the provisions of the statute creating the employment and it cannot be waived.

In the case of The Council of the Federal Polytechnic Mubi V. Yusuf & Anor, the Supreme Court held that, “In all the institutions setup by statute it is incumbent that the statutory provisions be adhered to when it comes to removal of its officers from office because the institution owe their existence to their statutes and must abide by the statutory provisions governing them.” Please note that removal from office is not impossible once the statutory provisions are adhered to in carrying out the exercise.

Difference between termination and dismissal

Although the two concepts are used to signify the end of an employment relationship, there are several differences between termination of employment and dismissal.

First and foremost, both the employer and employee can terminate a contract of employment while it is only the employer that has the power of dismissal.

Secondly, when an employment is terminated, the employee would likely be entitled to some benefits. However, a dismissed employee will likely not enjoy any benefit after the dismissal. In addition, an employee will receive salary in lieu of notice if his employment is terminated before the specified notice period. However, such a benefit doesn’t accrue to an employee that was dismissed.

termination of employment

Remedies for a wrongfully terminated employee

One of the classical principles of employment law is that under private employment, the court cannot impose an employee on an unwilling employer. The implication of this is that where private employment is wrongfully terminated, the only remedy the employee can receive is damages to compensate for the loss he has suffered. This includes the salary in lieu of notice, other benefits and entitlements he ought to have received and general damages as determined by the court.

However, where an employee whose employment enjoys contractual flavour is wrongfully terminated or dismissed, the court can make an order of reinstatement of the employee. In that case, he would be paid all the salary he ought to have earned during the period of termination and would be placed on the grade level he ought to be if his employment had not been terminated. See CBN v. Igwillo; and Kwara Poly & Ors. v. Oyebanji.


The article has considered the meaning of termination of employment and all you need to know as an employee on the proper means of bringing your contract of employment to an end. In a situation where you are convinced that an employer has failed to follow due process, do not hesitate to contact and engage a legal practitioner for legal advice on the right course of action to take.



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