Labour

Suspension Without Pay And The Law Of Employment In Nigeria

INTRODUCTION

Suspension is a form of sanction meted out by an employer to an employee. The Nigerian labour space is regulated by laws, both statutory and judicial, but unfortunately, many employers do not take cognizance of this in their dealings with employees, especially low-level employees. This article examines the legal implications of this form of sanction in the employer-employee relationship in light of judicial authorities in Nigeria.

SUSPENSION

Suspension is the opposite of a permanent termination. It is the act of temporarily delaying, interrupting, or terminating something. [1] A more robust definition was given by the Supreme Court in Longe v First Bank Plc[2], as 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. Employees are usually suspended for a number of reasons, ranging from their violation of company rules to other misconduct.

TYPES OF SUSPENSION

The Court in City Central Group of Companies Ltd v Eze[3] lucidly explained the two categories of suspension in these words;

Generally, there are two types of suspension: ‘suspension pending inquiry’ and ‘suspension as a punishment’. The former is not a punishment per se, for if the employee is not found guilty, the suspension will be lifted and he will be netted to receive full wages for the period as if he was never suspended. On the other hand, the suspension imposed on the establishment of guilt is in the nature of punishment; it can have an adverse impact on the career prospects of the employee within the organization.

SUSPENSION WITH AND WITHOUT PAY

The law on whether or not the suspension of an employee should be without pay, wavered for a long time with opposing positions, and the position affirming that suspension without pay was unlawful, gained higher grounds. The National Industrial Court of Nigeria (“NICN”) in Atoki v Ecobank Nig. Ltd. (2014) 47 N.L.L.R. (Pt. 151) 33 highlighting the importance of having a contract that expressly gives right to the employer to suspend without pay, before such employer can so suspend, held that: “An employer has the right to suspend an employee whenever necessary with or without pay. However, employers cannot suspend without pay where there is no express or contractual right to do so.” This presupposes that before an employer can suspend his employee without pay, there has to be provision for that in their employment contract.

Nevertheless, this road of suspension without pay, has to be treaded on carefully. In the case of Funmilayo Daniel Omosule v Oil and Gas Free Zone Authority Administration,,,  judgment of the NICN was delivered on the 3rd May, 2023 where it was held that in a contract of employment, there is no implied contractual right on the part of the employer to suspend an employee without pay on disciplinary grounds. The court further held that:

“The Defendant has not shown that the stoppage of the Claimant’s salary during suspension was permitted by the condition of service. The result is that there is no evidence before this court to show that the Defendant has the right in the contract to suspend the Claimant without pay. Consequently, the Defendant failed to justify the stoppage of the Claimant’s salary during suspension. The Defendant clearly had no justification to withhold or stop the Claimant’s salaries since 20th April 2011. The stoppage of the Claimant’s salary is therefore wrongful. The Claimant is entitled to be paid his salaries during the period of suspension.”

Also, in the 2018 judgment of the NICN in Jessica Akaa v Sterling Bank, the law was settled that although an employer has a right to punish or discipline his employee, he is not at liberty to mete out any kind of punishment or discipline he wishes on his employee; he must act within the terms of contract which in the case, was the staff handbook. The court in this case, found that the Defendant’s staff handbook did not provide for suspension without pay, the suspension of the claimant without pay was therefore held to be a violation of the terms of contract and declared wrongful.

The law is settled that an employer cannot indefinitely suspend an employee without due investigations or bringing such a suspension to a logical end, and to allow an employee wallow in suspension without pay for 77 months is inhumane and a violation of the employee’s right to fair hearing.[4]

From the foregoing, it appears that suspension without pay can only be justified were the employment contract expressly provides for it. However, it has to be employed within reason, as a suspension without pay for an unreasonable and ridiculously long time has been held as unlawful.

CONCLUSION 

Employers in Nigeria need to be careful when employing the tool of indefinite suspension and suspension without pay, as a little slip can land the employer into the trouble of paying unplanned damages and wrecking the financials of the business. Ultimately, it is much better to suspend with pay, an employee suspected of any wrongdoing and eventually dismiss such employee upon completion of investigation and availability of concrete evidence to prove the same.

Alternatively, an employer who is bent on meting out suspension without pay on an erring employee must ensure that the employment contract and company policies sufficiently accommodate such provisions. However, such an employer has to tread carefully and avoid suspending the employee without pay for an unreasonable period of time, as the law will always tilt in favour of the employee in such a scenario.


[1] Access Bank v Petro-Al (Nig) Ltd v OKONKWO (2017) LPELR-45198 (CA). See also, Black’s Law Dictionary, 8th Edition.

[2] (2010) 6 NWLR (Pt. 1189) 1.

[3] (2021) LEPLR-55725 (CA).

[4] This was held in UGOCHUKWU EDMUND OKWU V ZENITH BANK PLC (UNREPORTED SUIT NO. NICN/LA/85/2017, JUDGMENT DELIVERED SEPTEMBER 10, 2020 ; PER HON-JUSTICE R.H GWANDU).

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About Ebere Ndubueze

Ebere Ndubueze is a corporate lawyer practicing in Nigeria; a member of the Nigerian Bar Association, and an Associate of the Institute of Chartered Mediators and Conciliators. She can be reached via ndubuezeeberelene@gmail.com; +2348169008219