Aug 3, 2020

5 Points To Note On Constructive Dismissal Arising From Involuntary Registration | Kayode Omosehin


1.  What is the meaning of Constructive Dismissal?

In order to discourage hostile work environment, common law sides with an employee who has been subjected to a forced or compulsory resignation, especially where it is clear that the employer has pressured the employee into involuntary resignation without any reasonable ground.

Whenever a resignation is not voluntary, the #law views it as a kind of unlawful #termination known as constructive dismissal or constructive discharge. In C.B.N. v. Aribo (2018) 4 NWLR (Pt. 1608) 130, the Supreme Court held as follows:

“A forced or compulsory resignation by an employee amounts to constructive dismissal ……. In this case, the respondent did not voluntarily resign. His employer (the bank) advised him to resign after the 1st appellant revoked the bank's licence to conduct foreign exchange and fined it for illegal foreign exchange transaction. In the circumstance, the respondent's resignation amounted to a constructive dismissal.” (P. 172, paras. C-E)

 Constructive dismissal is a type of disengagement which arises from the involuntariness of the employee’s decision to leave an employment, which entitles the employee to sue the employer after exiting the employment. According Hon. Justice Kanyip in Balonwu v. Voluntary Service Overseas (VSO) International“constructive dismissal/discharge once proved evinces a poor and unfair labour practice on the part of the employer”.

 

2.   When Can Constructive Dismissal Arise?

 From notable judicial decisions, constructive dismissal may arise in two circumstances resulting in involuntary resignation:

 1.    When an employee resigns on the advice or request of the employer; or

2.    When an employee is forced by the employer to resign.

 Management’s advice to an employee to resign must be proved by credible evidence and this can be established through the email or memo or report of a panel. For instance, in Mrs. Vivien Folayemi Asana v. First Bank of Nigeria Ltd, the judgment of which was delivered on 9th October 2018, the National Industrial Court held thus:

 “By Exhibit C5/D3 (i.e. Claimant’s letter of resignation and Exit Form), the claimant stated thus: “Further to the request that I should resign, by Management of First Bank of Nigeria Ltd. I hereby tender my letter of resignation”. (words in parenthesis supplied for clarification).

 A worker may be forced into #resignation where the employer’s action or action is #discriminatory, oppressive, humiliating or intolerable and the #employee has no choice but to resign. In Mr. David A. Fadipe v. Cedarcrest Hospitals Limited, the Court held that constructive dismissal means the attempt by an employer to have the employee resign, rather than outright firing the employee.

 For instance, while relying on the case of Miss Ebere Ukoji v. Standard Alliance Life Assurance Co. Ltd [2014] 47 NLLR (Pt. 154) 531 NIC, my lord Justice Kanyip, President of the National Industrial Court, in the Balonwu v. Voluntary Service Overseas (VSO) International, held as follows:

 “From Miss Ebere Ukoji v. Standard Alliance Life Assurance Co. Ltd, the employer need not have asked the employee to resign. The behaviour of the employer is sufficient once it is intolerable or heinous that the employee has no choice but to resign. The employer must have created such working conditions or so changed the terms of employment that the employee has little or no choice but to resign. It must be noted though that the claimant’s case in the instant case is not that the employer changed the terms of employment. Where the employer makes life extremely difficult for the employee, to attempt to have the employee resign, that will amount to constructive dismissal.

 Below is a list of unbearable behaviours or circumstances which the courts have held to justify an employee to resign and make a claim for constructive dismissal on the ground of involuntary resignation:

 -      Actual or repudiatory breach of employment contract such as employer’s unilateral reduction of salary, demotion, non-payment of salaries;

 -      Victimization, witch-haunt, vendetta, retaliation, targeting the victim for whistleblowing or filing a complaint or grievance procedure against a colleague or superior;

 -      Discrimination on ground of sex, age, religion, ethnicity or nationality, disability, etc;

 -      Gender harassment, for example telling female colleague that “this is a boys club” or a male colleague that “why do you like ladies’ job?”

 -      Racial harassment in form of racial slurs, insults, jokes, disgust, degrading comments and intolerance of difference or other form of racial harassment;

 -      Personal harassment such as inappropriate comments, offensive jokes, personal humiliation, critical remarks, ostracizing behavious, intimidation tactics, or any other behavior that creates intimidating and offensive work environment for the victim.

 -      Physical or verbal harassment or workplace violence (such as physical attack or destroying something to intimidate the victim) or threat of violence (such as shaking fists at the victim’s face);

 -      Power or psychological harassment in form of excessive or impossible targets above employee’s ability or resources, demeaning demands far below the employee’s designation, intrusion of personal life such as unreasonable tracking or monitoring of personal device, belittling acts, discrediting or challenging everything the victim says or does, cyberbullying the victim,

 -      Third party harassment, which involves someone from outside of the organization, usually vendor, supplier, customer or client of the company who is friends with a colleague or boss (i.e. the perpetrator).

 Anyone one of the above (happening alone) or a collection of some of the above circumstances are enough to justify immediate resignation and a claim for constructive dismissal by the victim.

 Whatever an employee finds unbearable or intolerable, the employee is required to show that the behaviour of the employer is so intolerable or heinous that the employee has no choice but to resign. The employer must have created such working conditions or so changed the terms of employment that the employee has little or no choice but to resign.

 While relying on the case of Miss Ebere Ukoji v. Standard Alliance Life Assurance Co. Ltd [2014] 47 NLLR (Pt. 154) 531 NIC, my lord Justice Kanyip, President of the National Industrial Court, in the Balonwu v. Voluntary Service Overseas (VSO) International, held as follows:

 “From Miss Ebere Ukoji v. Standard Alliance Life Assurance Co. Ltd, the employer need not have asked the employee to resign. The behaviour of the employer is sufficient once it is intolerable or heinous that the employee has no choice but to resign. The employer must have created such working conditions or so changed the terms of employment that the employee has little or no choice but to resign. It must be noted though that the claimant’s case in the instant case is not that the employer changed the terms of employment. Where the employer makes life extremely difficult for the employee, to attempt to have the employee resign, that will amount to constructive dismissal. The employee may resign over a single serious incident or over a pattern of incidents. But generally, the employee must have resigned soon after the incident?”

 

3.   How Does an Employee Prove Force, Coercion or Involuntariness of a Resignation?

 It is sometimes difficult to prove that an employee has been forced to resign. Circumstantial evidence may help but it is better to have direct evidence. For instance, where there is an email or memo or a report of investigation from the management requesting, advising or directing an employee to resign, the job of proving involuntariness will become easy. It is important for all employees to keep proper record of email communication, especially on disciplinary process.

 Sometimes, also, employees may assist the court in setting out in their respective resignation letters, the background facts that are relevant to their decision to resign. For instance, in Mr. Charles Ughele v. Access Bank Plc, the judgment of the National Industrial Court, which was delivered on 10th February 2017, the National Industrial Court held thus:

 “The claimant did not leave anyone in doubt that he resigned involuntarily. Exhibit C4 (same as Exhibit D4) is the Exit Form. Against the reasons for exit, the claimant ticked “redundancy” under “involuntary”; and under question 1 at page 2, to the question, “What are your primary reason(s) for leaving?”, the claimant answered, “Management decision to create room for new people to work with new GM”.

 It is important for the employee to have clear and credible evidence to show the employer’s request, advice or directive to the employee to resign or some other unpleasant actions of the management which, indeed, forced the employee to resign.

 

 4.   When Must the Employee Resign? What happens if resignation is delayed?

 In order to successfully make a claim for constructive dismissal, the victim must have resigned immediately or within a reasonable time after experiencing the unpleasant incident. Delay in putting a resignation letter may amount to acquiescence and, consequently, destroy the chance of claiming for constructive dismissal.

 The case of Western Excavations v. Sharp [1978] 1 All ER 713 points to the fact that there must be a repudiatory breach (actual or anticipatory) on the part of the employer, which must be sufficiently serious to justify the employee resigning; the employee must resign in response to the breach; and the employee must not delay too long in acting on the breach.

 Also, in Joseph Okafor v. Nigerian Aviation Handling Company Plcthe judgment of which was delivered on 25th April 2018, National Industrial Court held thus:

 “…to be able to succeed in a claim for constructive dismissal, the claimant must show that he resigned soon after the incident(s) he is complaining about.”

 According to Justice Kanyip, President of the National Industrial Court, in the Balonwu v. Voluntary Service Overseas (VSO) International:

 The employee may resign over a single serious incident or over a pattern of incidents. But generally, the employee must have resigned soon after the incident?”

 It is difficult to set a definite timeline for all cases, as every case will be determined on its merits. If an employee resigns within a reasonable time after becoming a victim of unbearable and unpleasant circumstance, the court will grant his or her claim for constructive dismissal.

 For instance, in the Balonwu's case, the employee (a #Country Director of the Voluntary Service Overseas (VSO) International) resigned 3 days after the unbearable event she complained about and the #Court held that the 3-day period wasn't too long to defeat her claim for constructive dismissal. Specifically, the Court held as follows:

 “The point in these cases is that for a claim for consecutive dismissal/discharge (for that is what the claimant’s case actually is in the instant suit) to succeed, the claimant must have resigned so soon after the employer’s act. The defendant argues that the 3 days in between the date of Exhibit C5/D3 and when it was received is too long a period for the claimant’s claim for forceful resignation (constructive dismissal/discharge) to be hinged on. Is this the case? I do not think so. Three days is not too long a period in this regard especially as the defendant made no attempt before now to dispute the fact that the claimant alleged that she was requested by the defendant to resign her employment. The defendant was until now silent on that fact. I accordingly believe the claimant that she was requested by the defendant to resign her employment…I accordingly hold that the claimant has made out a case for constructive dismissal/discharge. Relief (1) accordingly succeeds and so is hereby granted….…”

 A good example of delayed resignation can be found in Suit No. NICN/LA/291/2016 Joseph Okafor v. Nigerian Aviation Handling Co. Ltd. (delivered by Justice B.B. Kanyip in Lagos on 25th April 2018) as follows:

 “……..the claimant’s resignation took effect from 31st December 2015. I agree with the defendant that the acts for which the claimant complains and hence makes a case for constructive dismissal were acts that occurred between 2009 and 2014. This means that it took a year for the claimant to resign because of the said acts. This is tantamount to waiver or condonation by the claimant. It cannot even be that the claimant showed that he resigned soon after the incident(s) he is complaining about as Miss Ebere Ukoji v. Standard Alliance Life Assurance Co. Ltd (supra) enjoins. As it is, therefore, the claimant has failed to prove his case. The case fails and is hereby dismissed.”


5.    What is the Remedy for Constructive Dismissal?

Once constructive dismissal is proved, general #damages become awardable. The amount to be awarded will be based on the facts of each case. Even in the case of B.E.D.C. Plc. V. Eseluka (2015) 2 NWLR (Pt. 1444) 411 where the plaintiff did claim wrongful dismissal but lack of notice of dismissal, the Court of Appeal found that the plaintiff was constructively dismissed and held at page 439 as follows:

 “As I have imputed legal notice of the respondent’s dismissal by end of April 2000, then the respondent was only entitled to his salary from the date he was interdicted on half pay till end of April 2000 when he received constructive notice of his dismissal. That is the discretionary resolution that accords with the law, equity and common sense. I hereby order that the respondent be paid his full salaries and allowances due to him from 22nd October 1996 when he was put on half pay till April 2000.”

 In Mrs. Vivien Folayemi Asana v. First Bank of Nigeria Ltd, delivered on 9th October 2018, Honourable Justice B. B. Kanyip, PhD of the National Industrial Court awarded N2,000,000 (Two Million Naira) as damages for constructive dismissal, which was deducted from the claimant’s outstanding staff loan.

 In three cases, Mr. Charles Ughele v. Access Bank Plc delivered on 10th February 2017, Mr. David A. Fadipe v. Cedarcrest Hospitals Limited delivered on 8th July 2020 and Ms. Lucia Balonwu v. Voluntary Service Overseas (VSO) International delivered on 22nd July 2020, Hon. Justice B.B. Kanyip awarded the sum of N1 Million only as general damages for the constructive dismissal of the claimant in each of those cases.

 It should be noted that the old judicial authorities which decided that the measure for damages for unlawful dismissal is the amount representing the length of notice the employee would have be entitled to are all inapplicable since the advent of the Third Alteration of the 1999 Constitution.



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