By Desire Emmanuel
The National Industrial Court has told a former employee of Union Bank Plc who accused the bank of underpaying his entitlement that the period he went on leave of absence from the organisation without pay cannot be used to calculate the entitlement.
Justice Isaac Essien of the Lagos division of the court gave the ruling while dismissing the entitlement claim filed by the former employee, Mr Alex Chukwuma, against the bank.
The court held that Chukwuma’s entitlement was correctly calculated, taking into account his 25 years of service and that he can no longer claim any additional payment regarding his leave of absence.
According to documents, Chukwuma told the court that Union Bank employed him in October 1980 as a management trainee and he rose to become a senior manager.
He added that in November 2005, he took up appointment as a commissioner in one of the states and was granted a two-year leave of absence without pay by the bank.
Chukwuma also said in 2007, he was re-appointed commissioner and was further granted leave of absence which was to expire in November 2009.
He disclosed however that on November 16, 2009, he resigned his appointment with the bank, adding that when the bank computed his gratuity having completed 25 years in the employment of the bank on October 9, 2005, it did not include the four years of his leave of absence.
Union Bank, during its defence, contended that the items which Chukwuma used in calculating his entitlement are not correct and posited that Chukwuma’s resignation took effect from the time he commenced his leave of absence without pay.
It added that Chukwuma had since been paid his entitlements and that his action, as presently constituted, is statute-barred for violating the Limitation Laws of Lagos State, which provides that all actions founded on simple contracts must be commenced within six years after the cause of action arose.
Counsel to Chukwuma however opposed the bank’s defence, arguing that the contract of employment between his client and the bank is not a simple contract and therefore not affected by the Limitation Laws of Lagos State.
He averred that the limitation law does not appear to impose a restriction on or place a bar on actions brought to enforce the constitutional right to terminal benefits mandatorily guaranteed by Section 173(1) – (3) of the 1999 Constitution, and urged the court to grant the reliefs sought.
While delivering judgment, Justice Isaac Essien held that it is inconceivable and cannot be imagined that Section 8(1)(a) of the Limitation Laws of Lagos and indeed any other limitation law of any state in Nigeria can be said to apply to contract of employment in view of the complexities both in employment contract and the various regulation that apply to a contract of employment.
The judge reiterated that no employment contract can be classified as a simple contract under any limitation of action law, and held that an employment contract in Nigeria cannot be classified as a simple contract.
On whether Chukwuma’s period of leave of absence can be included as part of his period of service with the bank in order to be entitled to the shortfall in the computation of his gratuity and pension, the judge held that he cannot claim to be entitled to have his years of service extended to cover the period of leave of absence.
The judge said that the only instance where the period of leave of absence can be considered in computing the service years of an employee is where the leave of absence was with pay.
