REGINAL CHUKWUMA ONWE - VS- UNION BANK OF NIGERIA PLC - National Industrial Court of Nigeria

IN THE NATIONAL INDUSTRIAL COURT OF NIGERIA

IN THE LAGOS JUDICIAL DIVISION

HOLDEN AT LAGOS

BEFORE HIS LORDSHIP, HON. JUSTICE (DR.) 1. J. ESSIEN

DATE: 30^th October 2025 SUIT NO NICN/LA/443/2021

BETWEEN

REGINAL CHUKWUMA ONWE Claimant

AND

UNION BANK OF NIGERIA PLC Defendant

JUDGMENT.

The claimant commenced this action by a complaint dated and filed on the 23/11/2021. In the complaint the claimant sought the following reliefs from the court:

1. A Declaration of this Honourable Court that the Defendant is in arrears of the Claimant’s gratuity and pension

2. A Declaration of this Honourable Court that the Defendant is in arrears of the Claimant’s long service award

3. A Declaration of this Honourable Court that the payment of the Clamant’s gratuity and pension on the basis of his basic salary, housing, transport and lunch subsidy as at 2005 instead of his total emolument of N11,796,063.00 as provided in the Defendant Pension Deed of variation, 1996 is unlawful/wrongful.

4. An Order of this Honourable Court for the payment of N27, 511,536.50 which represents shortfall in his gratuity entitlement.

5. An Order for the payment of shortfall in the Claimant’s pension of N6,276, 515.97 from November 2009 till liquidation.

6. An Order of this Honourable Court for the payment of interest at the rate of 25% on the long service award, gratuity and pension short payment under (4) & (5) above from November 2009 till liquidation in this suit.

7. An Order of this Honourable Court for the payment of the Claimant’s long service award for 25 years as follows: 25% of annual basic salary i.e. N690, 625.00 and cash award of N375, 000.00.

8. An Order of this Honourable Court that cost of this suit -in the sum of Nl, 000, 000.00 (One Million Naira) be paid to the Claimant.

9. An Order of this Honourable Court for the Payment- of the post judgment interest at 25% per annum.

10 And for such other consequential Orders this Honourable Court will deem necessary in the circumstance.

Filed along with the complaint is the statement of facts and a witness depositions of the claimant. Upon being served with the originating process, the defendants filed a statement of defence along with a witness deposition on the 2/8/2022. On the 17/10/2022, the claimant filed a reply to the statement of defence along with a further witness deposition on the 17/10/2022.

Hearing in this suit commenced on the 25/6/2024. The claimant testified as CW1. He adopted his witness depositions and went on to tender the following documents in evidence;

1. Offer of appointment is Exhibit CW-1

2. Letter date 19/10/2001 is Exhibit CW-2

3. Contract of service is Exhibit CW-3

4. Union Bank Handbook is Exhibit CW-4

5. Trust Deed is Exhibit CW-5

6. Application for 2 years leave of absence is Exhibit CW-6

7. Application for extension of leave of absence is Exhibit CW-7

8. Letter of constitution of Ebonyi State Executive Council is Exhibit. CW-8

9. Letter of payment of terminal benefit is Exhibit CW-9

10 Letter of review of long service award is Exhibit CW-10

11 Letter of Resignation is Exhibit CW-11

12 Letter of new compensation package is Exhibit CW-12

13 Letter dated 31/3/2008 is Exhibit CW-13

Letter of notification of retirement benefit is Exhibit CW-14.

The claimant was crossed examined by the defence counsel and thereafter the claimant closed his case.

The defendant opened their case on the 21/5/2025. Francis Idiahe testifies as the sole witness for the defendant. He adopted his witness deposition and went on to tender the following documents in evidence:

1. Contract of service is Exhibit D1

2. Letter of appointment is Exhibit D2

3. Letter of Resignation of appointment id Exhibit D3

4. Defendant Board Resolution is Exhibit D4

5. Claimant curriculum vitae is Exhibit D5

6. Letter of payment of terminal benefit Exhibit D6

7. Certified Copy of Notice of Appeal Exhibit D7

8. Certified true copy of Judgment in Suit No NICN/LA/157/2018 is Exhibit D8

9. Deed of variation of Trust Deed is Exhibit D9.

10 Staff Circular No 18/97 Exhibit D 10

11 Claimant statement of Account is Exhibit D 11

12 Circular No 07/07 Review of Long Service award is Exhibit D12.

13 Certificate of Compliance is Exhibit D13

The defence witness was cross examined and there after the defence closed their case. The matter was adjourned to for the adoption of counsel final written addresses.

The defendant filed their final written address on the 4/9/2025 which the claimant final address was filed on the 9/10/2025. The defendant filed a reply on point of law to the claimant final address on the 24/10/2025. Counsel un-behalf of the parties adopted their final addresses and the suit was thereafter adjourned for judgment.

BRIEF FACTS IN ISSUE

The case of the claimant is that he was employed by the defendant in October 1980 as a management trainee. He rose to become a senior manager. On his employment he was made to sign a contract of service together with the defendant’s 1996 Trust Deed which regulate the payment of gratuity and pension in the defendant bank. The claimant states that the annual emolument of a senior manager at the point of exit is N11,796,063.00k. The claimant states that in November 2005 he took up appointment as a commissioner in Ebonyi State and was granted a 2 year leave of absence. In 2007 he was re-appointed commissioner and was further granted leave of absence which was to expire in November 2009. At the expiration of the appointment, he was appointed Executive Chairman of Fiscal Responsibility Commission on the 6^th November 2009. On the 16^th November 2009 he resigned his appointment with the bank. The defendant by a letter dated 11^th February, 2010 wrote to accept the resignation but indicated that retirement took effect from 24^th November, 2005 and computed his pension to be N1, 390, 924.98 per annum and gratuity of N6, 697, 046.20. It is his case that because of the computation of his gratuity on the bases of 24^th November 2005 as my exit date instead of 16^th November 2009, resulted in Gratuity/pension shortfall of N27,511,536.50. It is also his case that the Defendant computed his pension on 54% of my basic, transport, lunch, and housing instead of 65% of his total emolument of N11. 796,063.00, He argues that his total pension should have been N7,667.440.95. That the shortfall of his pension is in the sum of N6, 276, 515.97. He contends that the shortfall in the pension and gratuity arose as a result of the misrepresentation of what constitute total emolument in the Defendant’s Circular number 18/97 dated 29^th October 1997. He relied on the Trust Deed of 1996. He stated that the Defendant’s Circular Number 18/97 which the Defendant relied on in the computation of his gratuity conflicts with the Trust Deed, 1996. He also claims that he completed 25 years in the employment of the Defendant on 9^th October 2005 but was denied my long service award. That the claimant owes him N1, 065,625.00 being 25% of his annual basic salary as long service award

The defendant case on the other hand, admits that the claimant was employed by the defendant on the 9^th October 1980. That the terms and conditions of the employment were strictly contained in the contract of service. The defendant contends that the items which the claimant used in calculating his terminal emolument is not correct and states that the claimant annual exit emolument is N2,575,787.00 and not N1,796,063.00 as claimed by the claimant. It is also his position that the claimant resignation constructively took effect from the time he commenced his leave of absence without pay. The claimant did not retire from the defendant service. the defendant also contend that the claimant was in the service of the defendant for 25 years, 1 month and 18 days and not 29 years. It is their position that the claimant pension of N1.390,924.98 and his gratuity benefit of N6, 697,046.20 were correctly computed and paid to the claimant adopting the percentage applicable to the claimant 25 years in the service of the defendant in line with the defendant Trust Deed and the customary practice of adopting basic salary, housing allowance transport allowance and lunch allowance in determining the pension entitlement and end of service gratuity of the claimant. The defendant contends that there is no conflict between Circular No 18/97 and the Trust Deed 1996. That circular No 18/97 was only an interpretation of the Trust Deed by the directors of the defendant. The defendant position also is that the claimant cannot rely on the benefit of Circular No 07/07 issued by the defendant on the 4^th July 2007 relating to long service award as the circular is stated to have been effective from 1^st April 2007. Finally, the defendant states that the claimant had since been paid the sum of N268,208.00k in to the claimant account on the 11/10/2005. This represents the contending issues between the parties in this action.

ISSUES FOR DETERMINATION.

Before I consider that real issues for determination, let me deal with the preliminary issue raised in the final written address of the defendant counsel. In paragraph 4.11 to 4.7.9 the defendant has argued that the action of the claimant as presently constituted is statute barred for being in violation of Section 8(l)(a) of the Limitation Laws of Logos State Cap 67 which provides that all actions founded on simple contracts must be commenced within 6 years after the cause of action arose. He stated that the Claimant’s cause of action arose in this case on the 16^th day of November 2009 when he formally resigned his employment from the service of the Defendant. That this action became statute barred on the 16^th day of November 2015 which marked the 6 years anniversary of his alleged claims. Counsel cited several authorities which I have read and reviewed, including the recent decision of the Supreme Court in the case of Dr. Moses U. Anolarn V. The Federal University of Technology Owerri (FUTO) & Ors [2025] LPELR-80027(SC1

In Response to this objection the claimant counsel in his final address has argued that the contract of employment between the claimant and the defendant as evidence by Exhibit CW-3 is not a simple contract and therefore not affected by the provisions of S.8(1)(a) of the Limitation laws of Lagos State. He argued that limitation law does not appear to impose restriction on or place a bar on actions brought to enforce the constitutional right to terminal benefits mandatorily guaranteed by section 173(1) – (3) of the 1999 Constitution. Counsel argued that Order 30 R.8 (1) & (2) of the NICN Civil Procedure Rules 2017 requires that grounds of defence which make an action unmaintainable and limitation law must be pleaded in the statement of defence and summons. He stated that the Defendant in her statement of defence did not plead that the instant suit is statute barred nor raised any Notice of preliminary objection. Counsel Relied on the case of Chigbu V. Tonimas (Nig) Ltd. [2006]9 NWLR (pt. 984) 189 (SC) 208 – 209 H – D. He urged the court to dismiss this objection as it was not properly brought before the court.

I have carefully considered the argument of counsel on this matter. Order 30 R.8 (1) & (2) of the Rules of this court Provides:

(1)All grounds of Defence or Reply which make an action unmaintainable or which if not raised will take the opposite party by surprise of or will raise issues of facts not arising out of the pleadings shall be specifically pleaded.

(2)Where a party raises any ground which makes a transaction void or voidable or such matters as limitation law, release, payment, performance, facts showing insufficiency in the contract of employment or illegality either by any enactment or by common law, the party shall specifically plead same.

The above quoted provisions of the rules of this court requires the defendant to specifically plead the defence of statute barred being a limitation law before it can be properly raised in this action. I have carefully examined the statement of defence filed on the 2/8/2022, there is no where the defendant raised any defence of limitation of action. I agree with the learned claimant counsel position that the defence has not been properly raised. This being the case it is the finding of this court that the defence of Limitation of action pursuant to S. 8(1)(a) of the Limitation Law of Lagos State is not properly raised in this action.

Notwithstanding the above position of the court, assuming the defence is anything worth considering the question is whether the employment contract between the parties to this action can be said to be a simple contract for which the defendant can seek protection under the S. 8(1)(a) of the Limitation Law of Lagos State. This law provides that all actions founded on simple contracts must be commenced within 6 years after the cause of action arose. The question is whether a contract of employment is a simple contract within the contemplation of the Limitation Law of Lagos State. Judicial authorities have provided insight into what amounts to a ‘simple contract’.

The Supreme court in a plethora of cases have given an insight into the kind of contract that can be classified as a simple contract. In the case of TSKJ (Nig) Ltd V. Otochem (Nig) Ltd [2018] LPELR-44294 (SC), the court held that transaction between the parties which is that of houseboat hire is a simple contract. According to the Court, “This, in my view, is a simple contract and not an admiralty or maritime matter,” Similarly, in Rahman Brothers Ltd. V. NPA (2019) LPELR-46415 (SC), the tenancy arrangement to indemnify/ the respondent against all loses, etc, arising, from any fire incident in the rented storage space was held to be a simple contract. Also, in Bank of Industry Ltd. V. Obeya (2021) LPELR-56881 (SC). The Supreme Court stated that debt recovery of a professional fee (not contract of employment) was held to be a simple contract. For the avoidance of doubt contract of employment in this country has always been regulated and have the following features:

(a) The letter of employment/employment agreement,

(b)The employee handbook in a private employment

(d) Collective Agreement entered into by the employees union

(e) The Labour Act 2004. See the case of Skye Bank Plc V. Adegun [2024] LPELR-62219 (SC) (Pp. 29 paras. C) where the Supreme Court emphasised the position thus, ‘In Nigeria, the primary regulation governing employer/employee or master/servant relationships is the Labour Act of 2004.’

(f) In most cases where the application of International Conventions becomes necessary pursuant to Section 254C 1 (12) of the Constitution of the Federal Republic of Nigeria 1999 (as amended) which empowers the National Industrial Court to apply any International Convention, Treaty or Protocol of which Nigeria has ratified relating to labour, employment, workplace, industrial relations or matters connected therewith, to employment contract in Nigeria, This International instruments also regulate employment contract in Nigeria.

These indices that characterise employment contract in Nigeria outlined above clearly distinguish it and separate it from simple contract. Therefore, it is inconceivable and cannot be imagined that Section 8(1)(a) of the Limitation Laws of Lagos and indeed any other limitation law of any state in Nigeria can be said to apply to contract of employment in view of the complexities both in employment contract and the various regulation that apply to a contract of employment. No employment contract can be classified as a simple contract under any limitation of action law. I must also note that the decision of the Supreme Court in the case of Dr. Moses U. Anolarn V. The Federal University of Technology Owerri (FUTO) & Ors ‘supra’ cited by the defendant counsel is clearly distinguished from the fact of this case. That case involved the application of POPA to public service employment. whereas in the present case this court is considering a private employment Therefore that case cannot apply in situation where private employment is not involved. Moreso that the defendant in this case is not raising limitation of action under the POPA.

For the reasons stated above It is the holding of this court that employment contract in Nigeria cannot be classified as simple contract. This being the case section 8(1)(a) of the Limitation law of Lagos State does not apply to the contract of employment between the claimant and defendant in this cation. For the above stated reason, the objection of the defendant as espoused in their final written address is discountenanced and accordingly dismissed.

ISSUES FOR DETERMINATION.

I have read the issues formulated by the parties in their respective written addresses. I shall not reproduce the issues again. However, from the contents of the pleadings and the evidence adduced at the trial this court is of the opinion the following issues donate themselves for determination.

1) Whether the claimant’s period of leave of absence can be included as part of his period of service with the defendant to be entitled to the shortfall in the computation of his gratuity and pension upon resignation as claimed in this action.

2) Whether the computation of the Gratuity and Pension of the claimant using the 25 years of service in the defendant was in accordance with the Trust Deed of 1996

ISSUE 1

There are certain facts that are very clear and undisputed as shown from the evidence adduced before the court. The claimant was employed by the defendant vide Exhibit C-1 and D-1 on the 19/8/1990. He continued in the employment and received promotions. The last of which was to the rank of Senior Manager as shown on Exhibit D2. The claimant on the 20/1/2006 in Exhibit CW-6 applied for 2 years leave of absence without pay which was latter renewed by Exhibit CW7 dated 12/5/2008 for another 2 years. At the expiration of the 2^nd renewal of the leave of absence, the claimant did not return to the service of the defendant. The claimant thereafter resigned his appointment from the services of the defendant on the 16/11/2009 as shown on Exhibit CW-11. The defendant accepted the resignation in the letter dated 11/2/2010 tendered as Exhibit CW-9

It is also not in dispute that upon resignation the defendant paid the claimant his gratuity in the sum of N6,697,046.20k and pension in the sum of N1,390,924.98K as evidenced in the computation tendered as Exhibit D6 and also tendered as CW-9 by the claimant.

The claimant grouse is that the gratuity/ Pension computation on the basis of 24^th November,2005 as his exit date instead of 16^th November 2009 resulted in Gratuity/Pension shortfall which is being claimed in this action. By his evidence, the claimant position is that the computation date should have been the date of his resignation which is 16/11/2009 and not 24/11/2005. Claimant counsel in paragraph 5.09 has argued in his final address that suspension of the benefits during the period of leave of absence cannot be discounted from his period of employment. Counsel relied on the case of Kasimu V. NNPC [2008]3 NWLR (pt. 1075) p.569. The defendant position is that in calculating claimant’s years of service in the defendant bank, what is to be taken cognizance of, is the date his employment commenced, up until 24^th November 2005, when he stopped working for the defendant. This is because all rights benefits and entitlements due to an employee during the period of leave of absence are suspended. Counsel relied on this court’s decision in the unreported Suit No NICN/LA/562/2012 Waheed Akanbi Vs. Stanbic Ibtc Bank PLC, per Hon. Justice J.T. Agbadu-Fishim delivered on 25^th June, 2014 .

I have carefully considered the evidence adduced in this case and the argument of counsel on this issue. It is not in dispute that the claimant in his letter of resignation dated the 16/11/2009 tendered as Exhibit CW11 admitted that he had served the defendant for good 25 years before taking the leave of absence in November 2005. When the leave of absence was granted to the claimant the claimant services to the defendant was suspended. The implication is that from the November 2005 the claimant was no longer rendering services to the defendant. The claimant was not also remunerated by the defendant during the period of the leave of absence. The employment between the claimant and the defendant to use the words of Agbadu-Fishim J. in Waheed Akanbi -Vs- Stanbic IBTC Bank PLC, ‘supra’ ‘was put on hold during the period of the leave of absence. The evidence before the court is that the claimant never returned to the defendant employment at the expiration of the period of the leave of absence. The claimant resigned from the employment as shown on Exhibit CW-11. While enjoying his appointment, the Government of Enugu State paid the claimant remuneration. It is not in doubt that the employment relationship between the claimant and the defendant was suspended from 20/1/2006 up to 16/11/2009 when he resigned his appointment. The claimant cannot now claim to be entitled to have his years of service extended to cover the period of leave of absence. The claimant rightly admitted that he served the defendant for 25 years. It is the finding of this court that the computation of the claimant 25 years of service to the defendant cannot exceed the period which he was in the active service of the defendant. The only instance where the period of leave of absence can be considered in computing the service years of an employee is where the leave of absence was with pay. In this instance the employee is deemed to be in passive service with the employer. In this instance the claimant leave of absence was without pay. I therefore agree with the learned defence counsel that for the purpose of calculation of the years of service of the claimant, the period when he was not on the payroll of the Defendant and on leave of absence (as evidenced by Exhibits D3, CW6 and CW7 respectively is not to be reckoned with. This is because all rights, benefits, and entitlements due to an employee during the period of leave of absence are suspended (as in this case).

ISSUE 2

The claimant case also is that the shortfall in his gratuity and pension entitlement arose from misrepresentation of what constitute total emolument in the defendant’s circular number 18/97 dated 29^th October, l997 paragraph C under the sub head of gratuity. The claimant in paragraph 8 tabulated his annual emolument as Senior Manager Group B, to be in the sum of N11,798.063. The claimant argued that circular No 18/97 dated the 29/10/1997 i.e. Exhibit D-10 mis represented the items which constitute total emolument in paragraph C which provides:

Immediate payment of gratuity based on total emolument i.e. salary, Housing Allowances, Transport Allowances and Lunch Subsidy at the time of disengagement

The claimant states that the above provision is against the provision of the Trust Deed of 1996 Exhibit CW-5 (Exhibit D-9) which provides

As from the 1^st day of January, 1994, the Pension and Gratuity Scheme shall be based on the total emolument of those classes of employees of the Bank as are qualified under the existing Rules regulating the payment of Pensions and gratuity and shall include Basic Salary, Lunch Subsidy, Housing and Transport Allowances. (under-lining for emphasis)

The defendant denies any conflict between Exhibit D-10 and CW-5. The defence Counsel in his written address argued that the claimant Gratuity and Pension were correctly calculated taking into cognizance his 25 years service. Therefore, the claimant can no longer lay claim to any additional payment as Gratuity and Pension.

I have carefully considered the evidence adduced by the parties in this case. A careful consideration of Exhibit D10 Circular No 18/97 shows that the items for computation of terminal benefit of an exiting staff of the defendant are Basic Salary, Lunch Subsidy, Housing and Transport Allowances. These items are the line items in paragraph 20 of the Trust Deed Exhibit D9. The position of the claimant that the shortfall in his gratuity and pension entitlement arose from misrepresentation of what constitute total emolument in the defendant’s circular number 18/97 dated 29^th October, l997 paragraph C under the sub head of gratuity cannot be correct. It is the finding of this court that there is no misrepresentation conflict whatsoever as regards the content of the line items for calculation of gratuity and pension in Exhibit D10 and D9.

The Law is that the burden of proof rest on the party who assets the affirmative of an issue. He therefore becomes under a duty to offer proof of the facts in which he wants the court to give judgment in his favour. See S. 131 (1) of the Evidence Act 2011. See the case of Isa V. Gamandi [2014] LPELR-23239. Also; Omole V. Colodense (Nig.) PLC [2010] LPELR-4778 (CA). See Nduul V. Wayo & Ors. [2018] 7 SC (pt.111) 164 at 212.

The proof required of the claimant is to show how he arrived at the sum he alleged he is entitled to. In the case of Dungus & Ors. V. ENL Consortium Ltd [2015] 60 N.L.L.R (pt 208) 39. The president of this Honourable court, Hon. Justice B.B Kanyip set the template of what is required for proof in employment claims when he held;

An entitlement is shown by reference to the law that gives it, the collective agreement from which the entitlement was agreed on between the contracting parties or the conditions of service governing the relationship of the employee and his/her employer.

The claimant in this action in paragraph 8 of his statement of claim computed his emolument package to be in the sum of N11, 798.063. 00. The claimant relies on the emolument package for Senior Managers as at the date of his exit from the defendant employment which he claims is 16/11/2009. The claimant tendered the New Compensation Package for Senior Manager ‘B’ i.e Exhibit 12. The claimant relies on this document as the basis of the compensation. Something is not okay with relying on Exhibit 12 as the basis of his computation. Exhibit 12 relates to staff who were in service up to November and December 2008. As earlier found in this Judgment the claimant service to the defendant was for 25 years and the services ended when the claimant proceeded on the first tour of the leave of absence as evidence in the approval given to the claimant in Exhibit CW-6 dated the 20^th January 2006, effective from 24^th November 2005. It is therefore the salary structure of the claimant as at November 2025 that would have been the correct basis for the computation of the gratuity and pension of the claimant. This is so because the Trust deed Exhibit D-9 which came into effect from January 1994 was to apply to the claimant. The schedule referred to in the rules in page 17 of the Trust Deed show that gratuity was to be calculated based on the length of service or the years of service and also the Pension payable was a function of the percentage of the emolument attached to the number of the years of service. The claimant failed to produce the template of what his salary structure was, as at November, 2005 when he proceeded on leave of absence which resulted in his services to the defendant being suspended. To rely on the terminal emolument of some of the managers of the defendants who retired in November 2008 is not correct and cannot produce the correct computation of the claimant gratuity and pension. The computation in paragraph 9 of the witness deposition is therefore not correct.

I agree with the Defendant Counsel that the schedule on page 17 of Exhibit D-9 provides the percentage for payment of pension as 54% and gratuity as 260%. The Claimant’s annual total emolument was N2,575,787.00 as at the time he left the service of the Defendant. It is therefore the finding of this court that the Claimant’s pension entitlement was correctly calculated taking into cognizance his 25 years of service, which is (N2,575,787 X 54% which is N1,390,924.98). This Court also finds that the Claimant’s gratuity was also correctly computed taking into cognizance his 25 years of service, which is (N2,575,787 X 54%) which is N1,390,924.98). The claimant can no longer lay claim to any additional payment as pension and gratuity.

The claimant in this action also claims in relief B and G, that the defendant is in arrears in the payment of long service award to the claimant and therefore is indebted to the claimant in the sum of N 690,625.00k cash award which is 25% of his annual basic salary. The claimant admits that N268,208. 00k was paid to him leaving a balance of N375,000.00k However in paragraph 23 of his reply to the statement of defence, the claimant abandoned this claim. The claim is therefore dismissed.

Finally, the claimant also claims 25% interest on the long service award, gratuity, and Pension short payment under reliefs (d), (e) and (f) from November until the liquidation of the debt. This Court has not awarded any of the claims of the claimant in this action. The claim of pre-judgment interest ids hereby dismissed.

The claims of the claimant in this action fails. The claimant has not discharged the evidential burden placed on him to proof his case. Accordingly, this action is dismissed.

I make no order as to cost.

Judgment is hereby entered.

_______________________________________________

HON. JUSTICE (Dr.) ISAAC J. ESSIEN

(Presiding Judge)