Losing a job can be difficult, but the situation becomes more serious where an employer terminates an employee’s employment in breach of the terms of the employment contract or applicable law. Wrongful termination in Nigeria is primarily a contractual issue in ordinary employment relationships. The rights of an employee depend on the terms of the employment contract, applicable legislation and the circumstances surrounding the termination. An employee who believes that their employment was wrongfully terminated should understand the applicable rules before deciding what legal action to take. What Is Wrongful Termination? Wrongful termination occurs where an employer brings an employment relationship to an end in breach of the terms governing the employment. For example, where an employment contract requires one month’s notice or payment of salary in lieu of notice and the employer terminates the employment immediately without complying with either requirement, the termination is wrongful. The National Industrial Court has repeatedly recognised the contractual nature of ordinary master-and-servant employment. Where the contract prescribes a procedure for termination, the employer must comply with that procedure. Is Wrongful Termination the Same as Unlawful Dismissal? The terms should not be used interchangeably. In ordinary contractual employment, wrongful termination generally refers to termination in breach of the employment contract. Unlawful dismissal can arise where the termination violates a statutory provision or affects an employment relationship governed by specific statutory protections. The distinction is important because the applicable remedies depend on the nature of the employment relationship. What Makes a Termination Wrongful? A termination can be wrongful where the employer fails to comply with a contractual or legally required condition for bringing the employment to an end. Common examples include: Failure to give the required notice. Failure to pay salary in lieu of notice where applicable. Failure to comply with a contractual termination procedure. Termination contrary to an applicable statutory requirement. Failure to comply with an agreed disciplinary procedure where the contract makes that procedure a condition of termination. The employment contract should therefore be examined before determining whether a termination was wrongful. Does an Employer Need a Reason to Terminate Employment? An employer is not bound to give reasons for termination but once he gives a reason for termination of employment he bears the burden to justify it. In ordinary master-and-servant employment, an employer generally has the contractual right to terminate the relationship in accordance with the applicable terms. The employer’s reason for termination does not necessarily determine whether the termination is wrongful. The critical question is often whether the employer complied with the contract and applicable law. However, this principle does not permit an employer to terminate employment for a reason prohibited by law or to disregard statutory protections applicable to the particular employment relationship. What If the Employer Terminates Employment Without Notice? Where the employment contract requires notice, the employer must give the prescribed notice or make the appropriate payment in lieu of notice. Section 11 of the Labour Act also provides statutory notice periods in circumstances covered by the Act. The prescribed period depends on the duration and nature of the employment. Accordingly, an employer who terminates an employment relationship without the required notice or payment in lieu of notice acts in breach of the applicable terms. What Is Payment in Lieu of Notice? Payment in lieu of notice is payment of the remuneration that would have been earned during the applicable notice period where employment is terminated immediately. For example, if an employee’s contract requires one month’s notice and the employer wants the employee to leave immediately, the employer must comply with the contractual provision concerning payment in lieu of notice. The precise entitlement depends on the employment contract and applicable law. Can an Employer Dismiss an Employee Without Notice for Misconduct? Yes. Dismissal for serious misconduct is distinct from ordinary termination by notice. Where an employee commits conduct that legally and contractually justifies summary dismissal, the employer can terminate the employment without the ordinary notice period. However, the employer must still comply with any applicable contractual, statutory and procedural requirements. Where disciplinary procedure is required by the contract or applicable law, the employer must follow it. What If the Employee Was Not Given a Fair Hearing? The consequences depend on the nature of the employment relationship and the applicable rules. In ordinary contractual employment, the right to fair hearing does not automatically convert every termination into an unlawful termination merely because the employee was not given an opportunity to defend allegations. However, where the contract, staff handbook, applicable statute or the nature of the employment requires a disciplinary procedure, failure to comply with that procedure can expose the employer to liability. The National Industrial Court has demonstrated that failure to comply with contractual and company procedures can have significant consequences in wrongful-termination claims. What Can an Employee Claim After Wrongful Termination? The remedy depends on the circumstances of the employment and the nature of the breach. In ordinary contractual employment, an employee can claim the financial loss resulting from the employer’s breach, including the applicable notice entitlement. Other accrued contractual entitlements can also be claimed where they remain unpaid. Recent Nigerian employment jurisprudence has also shown developments concerning damages for wrongful termination, making it important to assess the current authorities applicable to the particular claim rather than relying solely on older statements of the law. Can an Employee Get Reinstatement? Reinstatement is not ordinarily the remedy for wrongful termination in a purely contractual master-and-servant relationship. Where an ordinary employment contract has been wrongfully terminated, the usual remedy is monetary compensation for the breach rather than an order compelling the employer to continue the employment relationship. Different considerations apply to employment governed by statute or involving statutory flavour. The nature of the employment relationship must therefore be established before advising on the remedy. What Is Employment With Statutory Flavour? Employment with statutory flavour is employment governed by statutory provisions that prescribe the terms and conditions of the relationship. It is different from ordinary master-and-servant employment. Where an employee’s