Fractional Payment Only Applicable To Daily Paid Workers—Industrial Court Rules

His Lordship, Hon. Justice Nelson Ogbuanya of the National Industrial Court sitting in Lagos has ordered Equinox Intl. Resources Ltd to pay its former Human Resources and Administrator Mr. Abe Babalola the sum of N52, 000.00 unpaid balance of May Salary; N480, 000.00 Four Months salary, and One hundred and twenty thousand naira salary in lieu of notice with the sum of N1,000,000.00 as general damages within one month.

The Court held that in periodic employment of this kind, an employer who decides to terminate an employee within a new month is liable to pay for the full salary of that exit month and not the fraction of the days the employee worked in the month.

From facts, the Claimant- Mr. Abe Babalola was employed as the Head of HRA with six (6) months probationary period, and within one year, the firm terminated his employment on the ground of economic crunch and restructuring.

He further averred that at the point of the termination, he was owed some arrears of salary; including 7 days he worked in September before the termination and has not been paid salary in lieu of notice as stipulated in the offer of appointment, including general damages for the financial hardship occasioned by the unduly delayed payment.

However, the firm admitted owing the balance of N52, 000.00 as the balance of May salary but contended that it does not owe any salaries that the Claimant has abandoned his duty post during those months claimed, which amounts to constructive resignation of his appointment without notice.

The Defendant maintained that the Claimant is not entitled to any notice or salary in lieu of notice because he was dismissed for various infractions contended that the suit is underserved, and prayed the court to dismiss it with substantial cost.

In response, Counsel to the claimant, C.M Ohamuo Esq., (with J.O Muonye) argued that by the contention of the Defendant’s counsel that the Claimant’s employment was not confirmed after the six-month probationary period, the Claimant is still entitled to some payment for two weeks’ notice.

Counsel submitted that having completed the 6-month probationary period, the Claimant became a permanent staff and should be so regarded unless the court holds otherwise.

After careful consideration of the submissions of both counsel, the trial Judge, Justice Nelson Ogbuanya held that the employment relationship between the parties was terminated by the Defendant and not by the Claimant under any purported constructive resignation/abandonment of duty.

“I find nothing in this exh.CA2 to support the Defendant’s allegation of abandonment of duty by the Claimant and no evidence was presented at the trial in this regard. I find that the Defendant did not exercise any disciplinary measure in form of a query against the Claimant for his alleged abandonment of work and there was no evidence of any attendance record justifying the allegation.

“I find that there was no pending issue of gross misconduct that arose between the parties prior to this suit. And as such, there is also no evidence of any compliance with the rule of natural justice, denoting that the Claimant should have been confronted with such allegation and be given opportunity to defend himself, before any such allegation of misconduct can be granted to ground a dismissal. Not doing so, constitutes a flagrant breach of natural justice rule of fair hearing.”

Furthermore, on claimant claim for a fraction of September, Justice Ogbunaya held thus:

“I took out an opportunity to review the principle underpinning payment of salary in periodic employment, and came to the conclusion that pro-rata payment of salary is not applicable to workers in periodic employment, but only applicable to daily paid workers.

“Consequently, in my considered view, in a periodic employment of this kind, an employer who decides to terminate an employee within a new month is liable to pay for full salary of that exit month and not the fraction of the days the employee worked in the month. I so hold.

Lastly, Justice Ogbuanya also awarded the sum of N1,000,000.00 (one million naira) as general damages against the Defendant for the wrongful withholding of claimant accrued salaries thereby exposing him to undue financial difficulties, with the sum of N500, 000.00 costs of action within 1 month.