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His Lordship, Hon. Justice B. B. Kanyip of the National Industrial Court of Nigeria, Yola Judicial Division on Thursday 24th May in a judgment okayed the appointment termination of Madam Oyesola Ogunleye by Sterling Bank Plc on the ground of redundancy under Chapter 13, paragraph 13.3.3 of the defendant’s employee handbook. His Lordship also ordered Sterling bank to pay N5,616,915.30 as redundancy entitlement for one year’s gross salary and payment of N2,504,529.05 being un-computed payoff/gratuity, to be paid within 30 days of this judgment, failing which they shall attract interest at 10 per annum until fully paid.
The claimant commenced this action vide a complaint filed on 25th September 2014. By the statement of facts, the claimant sought among others; A declaration that in the premises of the on-going mass termination of appointments by the defendant, the appointment of the claimant was terminated on ground of redundancy under Chapter 13, paragraph 13.3.3 of the defendant employee handbook or in the alternative the contract of employment between the claimant and the defendant was wrongfully or unlawfully terminated by the defendant on the 24th October 2011. And An order directing the defendant to forthwith pay to the claimant the sum of N10,414,232 as outstanding separation benefits accruing in favor of the claimant from the defendant.
The claimant was employed by Magnum Trust Bank (MTB) Ltd on 8th January 1998. In 2005, MTB Ltd along with other banks merged to form Sterling Bank Plc, the defendant in this suit. Following this merger, the employment of the claimant was transferred to the defendant on 1st January 2006 vide a letter of 29th December 2005. For the 14 years that the claimant served the defendant, that her performance rating had always been over 70%, which thus qualified her for the payment of performance pay applicable to her grade level. That the claimant was paid various sums as performance pays between 2006 to September 2008; but those between October 2008 to December 2010 amounting to N2,046,824.00 and July 2011 to October 2011 amounting to N245,964.28 (both totaling N2,292,788.28) were not paid to her at the time of her exit from the defendant.
The claimant went on that consequent upon the downsizing of its workforce since 2010, the defendant over time laid off (retrenched) a number of its workers: over 200 in 2011, over 250 in 2013 and over 120 in 2014. This lay-off of staff, to the claimant, is redundancy in another name. The claimant’s appointment was, however, terminated by the defendant on 24th October 2011 vide letter of 21st October 2011 at a time she was on an annual gross salary pay of N5,616,915.36. The grouse of the claimant is that in calculating her separation benefits, the defendant wrongly excluded one year gross salary given that by the defendant’s letter of termination and the background of such termination (on-going mass sack), the defendant terminated her appointment on ground of redundancy.
The defendant denied the claim for payment of performance indexed pay to any of its staff between October 2008 to December 2010 due to the economic recession in the banking industry in the world over. The defendant also stated that it did not inform the claimant that her appointment was terminated on the ground of redundancy; rather her termination was purely in normal cessation exercise. To the defendant, it computed the gratuity of the claimant in accordance with its policy as per the handbook which took effect from 1st January 2006 taking into cognizance the claimant’s years of service with MTB Ltd. The defendant prayed the Court to accordingly dismiss this suit.
After reviewing the argument of the parties, the Court Presided by Hon. Justice B. B. Kanyip expressed thus;
“…The defendant’s denial is accordingly no denial at all; if anything, it is an admission that it faced redundancy within the period indicated by the claimant and that the claimant was one of such who faced redundancy. I accordingly agree with the claimant that the defendant’s denial is evasive and bare and so amounts to no denial at all; instead, it amounts to an admission. I so find and hold.
I need to stress a point here. The claimant's case is that there was a redundancy by the defendant and her employment was terminated by the defendant as a result of the said redundancy. All the claimant needs to prove is the fact that there was redundancy, not the details of the redundancy itself. On the state of the pleadings, therefore, I am satisfied that the claimant discharged the burden required of her in showing that there was redundancy and her employment was terminated as a result of the said redundancy. In holding that the claimant has discharged the burden of proving redundancy on the state of the pleadings, the argument of the defendant that it must first declare the claimant redundant before the claimant’s claim of redundancy can stand is not accordingly tenable; and I so hold.
Having held that on the state of the pleadings the claimant has established that there was a redundancy and her employment was terminated as a result of the redundancy, the next issue is proof of her entitlement to the sum of N5,616,915.36 as redundancy benefit. But in calculating the claimant’s entitlement as per the attachment to Exhibit C3(d)/D3, the defendant did not factor in redundancy, hence the instant claim by the claimant. From Exhibit C3(d)/D3, the claimant spent more than 10 years in the service of the defendant. Her redundancy entitlement is accordingly one year’s gross salary, which Exhibit C3(d)/D3 already puts as N5,616,915.30. This is the sum that the claimant is entitled to as redundancy; and I so find, hold and order.
Secondly, under clause 13.3.3 of Exhibit C2, in the event of termination, what is enjoined is a notice of termination or payment in lieu of notice. The defendant gave only three days notice. This is abnormal. For a staff who has spent 13 years 10 months in service, the notice period cannot be 3 days.
In all, the claimant’s case succeeds only in part and in terms of the following declaration and orders:
- It is hereby declared that the appointment of the claimant was terminated on ground of redundancy under Chapter 13, paragraph 13.3.3 of the defendant’s employee handbook.
- The defendant shall pay to the claimant as redundancy entitlement one year’s gross salary, which is N5,616,915.30.
- The defendant shall pay to the claimant the sum of N2,504,529.05 being un-computed payoff/gratuity.
- All sums payable under orders (2) and (3) are to be paid within 30 days of this judgment, failing which they shall attract interest at 10 per annum until fully paid.
