The Suspension of an Employee by its Employer and the right of an Employee to salary or wages while on suspension: Strike A Balance

Striking Balance

Introduction

Employer-employee relationships most often stem from an express written agreement between the parties. In legal parlance, it is known as a contract of employment. Such a contract of employment contains the terms and conditions of the relationship as well as the duties, functions and obligations of each party to the contract. This labour practice is not only practicable in Nigeria but also in all other jurisdictions around the world.

In Nigeria, the Labour Act is the main legal framework for employer-employee relationships. According to the Act, employers must provide their employees with a written statement containing the particulars of their terms of employment within three months of their employment.

The written statement must contain the names of the employer , name and address of the employee , the nature of the employment , where the contract is for a fixed term, the date the contract expires , notice to be given by a party wishing to terminate the contract , the rates of wages, its method of calculation, the manner and period of payment of the wages as well as terms and conditions relating to hours of work, holidays, holiday pay, etc., and lastly any special conditions of the contract .

Timothy Olamide is an Associate at Dispute Resolution Practice Group of Platinum and Taylor Hill LP, Ikoyi, Lagos State. He can be
reached via Olamide@pthlp.com or +234(0)8144856315
Cap L1, Laws of the Federation of Nigeria, 2004.
See section 7(1) of the Nigerian Labour Act
See Section 7(1)a
See Section 7(1)b
See Section 7(1)c
See Section 7(1)d
See Section 7(1)e
See Section 7(1)g
See Section 7(1)h

It must be noted that a contract of employment may take any form, but in substance, it must contain all the specifications outlined in Section 7(1) a-h of the Labour Act in Nigeria. Also, paragraph h of Section 7 of the Act, gives an employer of labour the unfettered discretion to add other special conditions to the contract. However, it is the humble submission of this writer that such special conditions in addition to the specifications in Section 7(1) a-g of the Labour Act, must be in line with the international labour best practice.

The right of an employee to a salary or wage while on suspension has caused some confusion amongst the employers of labour in Nigeria. This is not far from the mistaken belief by both employers and employees that termination of a contract of employment and suspension of an employee from a work mean the same thing and can have the same attendant legal consequence. However, under the Labour law, termination of employment and suspension of an employee from employment are not the same, they are two different things with separate attendant consequences.

It is against this backdrop that this paper tries to address this seemingly confusing issue of Termination of a contract of employment and Suspension of an employee from employment by an employer. Also, the right of an employee to salary or wages while on suspension in the absence of any other contrary agreement in the contract of employment or letter of suspension.

Is Termination Of Employment And Suspension Of An Employee The Same Under The Nigerian Labour Law.

To be able to answer the above poser, it becomes imperative to look at the meaning of both termination and suspension and whether they can be used interchangeably, as well as if they have the same legal consequences under the law.

Termination simply means to end something. According to the Oxford Advanced Learner’s Dictionary, New 9th Edition, termination means the act of ending something. While suspension means a temporary deferment. According to the Oxford Advanced Learner’s Dictionary, New 9th Edition, suspension means the act of officially removing somebody from their job, school, team, etc. for some time, usually as a punishment.

In the case of Esiaga vs University of Calabar & Ors while the Supreme Court was interpreting the word ‘Suspend’ held as follows:

‘The verb ‘suspend’ from which the word suspension (which is a noun) emanates in the context it was used essentially, ‘to defer, interfere, interrupt, lay aside, temporize, hold in abeyance.’

The Apex Court continued on the same page as follows:

“That term cannot be construed to mean, ‘terminate, extinguish, to bring to an end’. It means what it says, that is to cause to abate for a while halt midway but not to bring it to an end. It always connotes a state of affairs that should wait until a certain event takes place”

It can be swiftly concluded from the expository use of the two words by the Supreme Court that, though not in an employment matter, they are not the same under the law.
The courts have embraced the above interpretation of both words in employment cases.

The Supreme Court’s decision on the meaning of the termination and suspension of the 11 word was followed by the Court of Appeal in Globe Motors (Nig) Ltd V. Oyewole , an
appeal bordered on the suspension of the Respondent by the Appellant. In deciding that suspension is not the same thing as termination of employment, the Court of Appeal,
Lagos Judicial Division held as follows:

The question concerns the status of an employee who has been suspended from
 his employment either for a fixed term or indefinitely, as Respondent in this
 appeal. Suspension is a temporary cessation of employment either for a fixed
 term pending an investigation for an alleged wrong or as a disciplinary
 procedure for misconduct by an employee. These are the two types of
 suspension. Suspension of an employee from work only means suspension from
 ordinary duties assigned to him by virtue of his employment or office. See Esiaga
 v. University of Calabar (2004) LPELR-1165(SC); Akinyanmi v. University of
 Ilorin (2007)7 NWLR (P. 923) 87; National Judicial Council v. Aladejana
(2014)-LPELR-24134(CA). Either pending investigation or as a punishment,
 suspension does not amount to termination or dismissal from employment, the
 contract of employment remains subsisting until it is formally or legally brought to an end by either party…. Suspension and termination are two distinct terms with
 different legal consequences, one cannot be a substitute or synonymous for
 another.....

Having considered both the meaning and legal interpretation of the terms “termination” and “suspension,” which have different legal implications, it is important to explore the
rights of employees to receive wages or salaries during a period of suspension, in the absence of any contrary agreement in the contract of employment under the Nigerian
Labour Law.

The Right of an Employee to Salary or Wages While On Suspension under the Nigerian Labour Law

An employee’s basic and most important right is the right to wages. Generally, an employer is entitled to suspend an employee for any reason best known to the employer. However, whether the employer has the right to withhold the salary of his or her employee during the suspension period will depend on the contract of employment between the parties as well as the contents of the letter of suspension. In other words, an employee is entitled to salary or wages while on suspension, unless there is a contrary agreement in the contract of employment or the letter of suspension stating otherwise. This was the opinion of the Court of Appeal in the case of Globe Motors (Nig) Ltd v. Oyewole (Supra).

The Court of Appeal in the above case held as follows:

Since suspension is not a termination of the contract of employment nor a
 dismissal of the employee, the implication is that the employee is still in the
 continuous employment of the employer until he is recalled formally terminated or
 dismissed. Pending his recall or dismissal, a suspended employee is entitled to
 his wages or salary during the period of suspension, unless the terms of the
 contract of employment or the letter of suspension itself is specific that the
 suspended employee will not be paid his salary during the period of
 suspension… 

The penultimate Court continues on the same page of the law report as follows:

In the instant appeal, the letter suspending the Respondent, Exhibit B3, did not
 state that the Respondent will not be paid salaries. The letter of employment,
 Exhibit B1, did not contain any terms with respect to the suspension of the
 employee without pay. Furthermore, no employee handbook or collective agreement specifies the terms of employment, including rules about suspension,
 and indefinite or fixed terms. Where a suspension did not indicate that the
 suspended employee will not be paid salary or will be on half pay, the
 suspended employee is entitled to his emoluments during the period of the
 suspension

The writer humbly submits that our courts have a unanimous interpretation of the word “suspension”, whether in a contract of employment dispute or other disputes where the
13 word fell for interpretation.

However, it is important to highlight the decision made by the Supreme Court in the case 14 of Longe vs. FBN Plc. The court held that suspension is a state in which there is a
contract between the employer and the employee, but neither work nor remuneration is being paid.

For clarity and at the expense of repetition, the holding of our apex Court in Longe vs. FBN Plc is at this moment reproduced as follows:

Suspension is usually a prelude to dismissal from employment. It is a state of
 affairs which exists while there is a contract in force between the employer and
 the employee, but there is neither work being done in pursuance of it nor
 remuneration being paid. Suspension is neither a termination of the contract of
 employment nor a dismissal. It operates to suspend the contract rather than
 terminate the contractual obligations of the parties to each other....

It is being argued that just because the Supreme Court has mentioned neither work being done in pursuance of the suspension nor remuneration being paid during the suspension period in the above-mentioned ruling does not mean that an employee is not entitled to their salary while on suspension under normal circumstances. However, if an employer does not want to pay their suspended employee, the employment contract or suspension letter must clearly state that the suspension of such an employee is without pay.

Conclusion and Recommendation:

It can be swiftly concluded that, from the decided cases in Nigeria, termination of a contract of employment and suspension of an employee from work are two distinct terms with different legal consequences. Both terms under the Nigerian Labour law and even in other jurisdictions, are not synonymous and cannot be used interchangeably. It is therefore recommended for employers of labour in Nigeria to, in addition to issuing a contract of employment for their employees in accordance with the provisions of the law, make it clear in the contract whether their employees will be entitled to their salaries or wages while on suspension for any justified reasons.

This may also be stated in the letter of suspension given to an employee who is being suspended. This is to clear any form of doubt when a dispute arises for resolution whether in court or before the arbitral tribunal.

WhatsApp Image 2024 03 25 at 1.33.52 PM
Written by Timothy Olamide
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