APPRAISAL OF THE NIGERIA LABOUR LAW

© Taiye Abiodun

APPRAISAL OF NIGERIAN LABOUR LAWS:

IMPLICATIONS FOR INDUSTRIAL RELATIONS

T. A. Abiodun

© Taiye Abiodun

Objective

• At the end of the presentation, participants will:o Understand basic legal principles

o Have a better insight into Nigerian Labour laws

o Bench mark Nigerian Labour Laws against international Best Practice

o Appreciate the relationship between labour law and industrial relations

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DISCUSSION OUTLINE• Setting the stage

o What is lawo Classification of law

• Overview of Nigeria Labour Lawso Components of Nigeria Labour Laws

• Relationship Between Law & Practice

• Conclusion

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Setting the Stage

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Definition

• There is no generally acceptable definition of LawoJohn Austin considers it to be the rule laid

down for the guidance of an intelligent being by an intelligent being having power over him

oJustice Homes says that the prophecies of what the courts will do and nothing more constitutes the law

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Definition

• Consider This:oThe aggregate of the rules of behavior which

are either directly laid down by the State in the form of laws or sanctioned by it in one form or the other, such as custom

oThese rules are mandatory in that failure to observe them will attract sanctions

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Classification

• Bye laws: Laws made by a LG• Laws: Laws made by a State Government in a

Civilian era• Edicts: Laws made by a state Government in a

Military era• Acts Laws made by Federal Government in a

Civilian era• Decrees Laws made Federal Government in a

Military era

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Framework

Labour Laws

English Laws Local LawsInternational

Laws

Common Law And Equity

Statute of General Application

Conventions Recommendations

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Purpose

• The major purpose of the law is to influence human behavioro Law as it is not as it ought to be

• Labour laws influence workplace relations through laws that regulate:o Collective bargaining and determinations of terms

and conditionso Settlement of labour disputeso Supervision of labour safetyo Security of workers in old age, sickness, etc

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Laws affecting industrial relations (Intention and Basic Provisions of the Law)

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Laws Relating to Terms and Conditions of Employment

• Contract of Employmento This law is derived from English laws. It lays the

foundation for employment relations.

o It is a contract whereby a person offers another and that person agrees to work for another on agreed terms and conditions

o The law defines the rights and duties of both parties under common law, although they may be altered by legislations or written agreements

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• Labour Acto The law was enacted in 1974 to protect wages,

regulate contracts of employment and terms and conditions of employment

o The law is applicable only to workers (junior staff)

o Some provisions are:Wages shall be paid in legal tender as and when

due but not later than last day

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• Deductions from wages are prohibited except authorized by law/labour office

• Automatic recognition and deduction of dues to union except the worker contracts out

• A worker shall be entitled to particulars of employment after 3 months service

• Paid Holidays after 12 months continuous work

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• Any change in a workers terms of employment shall be communicated to him

• Normal hours shall be determined by CB but any hour above 8hrs shall be overtime

• A woman shall be entitled to paid maternity leave although the employer is not obliged to pay medical expenses

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• National Minimum Wage Acto The law which was first enacted in 1981 sought to

prescribe a minimum wage below which no employer should pay.

o The law is only applicable to establishments with 50 workers

o Some of its provisions are: Establishment of 4,500 Naira minimum wage Wages means total emolument

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Laws relating to Employee’s Welfare

• Factories Act• The Act which was enacted in 1958 and amended in

1987 makes provision for the safety of workers. It created minimum safety standards that employers must adhered to

• Some of the provisions are : o Factories shall be kept in hygienic stateo It should not be over crowdedo It should be well ventilated and lighted

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• Sufficient and suitable sanitary conveniences shall be provided

• Every machine that could injure a worker should be well fenced

• No untrained worker should work on any machine capable of causing injury unless he has been trained

• Precautions shall be taken in case of explosives and gases.

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• Workmen Compensation Act• The aim of the Act which was enacted in 1958

and amended in 1987 is to provide for payment of compensation to workers for injuries sustained in the course of employment

• The 1987 Act extended the coverage of the law to all workers as well as removed difficulties and delays in previous Act

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• Some of its provisions are:o Employers are liable to compensate employees

for injuries sustained provided the injury has incapacitated the worker for at least 3 days and is not as a result of workers serious and willful misconduct

o The amount of compensation are stated in the schedule and it depends on gravity of injury

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Pensions Reforms Act, 2004• The PRA, 2004 was enacted with the following objectives:

o Safe-guard Pension contributions so that every worker receives his retirement benefits as and when due

o Assist workers to save in order to carter for their livelihood during old age

o Ensure transparency & efficiency management of pension funds

• The scheme is compulsory for Public Sector and for all employers with at least five employees in the private sector:o Employees with less than 3 years to their retirement and those

covered by Section 291 of the Nigerian Constitution are exempted

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• Some of its provisions include:o Employees are to open a Retirement Savings Account

(RSA) with a Pensions Fund Administrator (PFA) of their choice

o Employer and employee to jointly contribute minimum of 15% employee’s basic salary, housing & transport allowances to RSA 7.5% by employer and 7.5% by employee in govt. ministries and

agencies 12.5% by employer and 2.5% by employee in Military In other cases, minimum of 7.5% each by the employer & employee

o Employer may bear the full burden, i.e. not less than 15%. Contributions can only be reviewed upwards

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• Employer to deduct and remit to Pension Assets Custodian (PAC) within 7 days of pay day

• PAC to notify, within 24 hours, the PFA who would credits the employee’s RSA

• Contributions and retirement benefits are tax-exempt• Employer shall maintain life insurance (3 times total

emolument) in favour of each employeeo Upon death & disability, the benefits under life insurance will be paid to

the RSAo Provisions for withdrawal from RSA shall apply and benefits be paid to

designated beneficiary

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• Account holders must be 50 years or upon retirement• Mode of withdrawal

o Programmed monthly or quarterly withdrawals or o Annuity for life purchased from Life Insurance

Company with monthly or quarterly paymentso Lump sum also possible where:

the amount left after the withdrawal shall be sufficient to procure an annuity or an amount not less than 50% of his annual remuneration as at the date of retirement

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Laws relating to Trade Union and Dispute Settlement

• Trade Unions Acts• The 1973 Act and the subsequent

amendments provide for the creation, registration and management of Trade Union.

• Trade Union means any combination of workers or employers, whether temporary or permanent, whose purpose is to regulate employment terms

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• Other provisions include:o No staff recognize as management projection

shall belong to the Union if it will lead to a conflict of interest

o Automatic recognition to the appropriate union

o It is lawful for the union or any of its members to engage in peaceful picketing in contemplation of a trade disputes

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• Trade Unions (Amendment) Acts (Decree No 4, 1996)o The objective of the amendment is amongst other things to remove

all anomalies in the present structure of trade unions caused by duplication and overlapping jurisdiction

o Employers shall make deduction from the wages of a worker and remit same directly to the Union after deducting what is due to the CLO

o Every trade union shall pay 10% of total collected check off dues to the CLO

o No person shall be eligible to contest for any post in the CLO or trade union unless he is a member of the Union – a member of the union is a card carrying member

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• Trade Unions (Amendment) Acts (Decree No 26 of 1996o The deductions and remittance of check off shall be subject

to a no strike clause in the collective agreemento The check off system will cease where:

Union has been dissolved by members Its certificate has been revoked Union embarked on a strike in breach of no strike clause

o It shall be unlawful for anyone not being a card carrying member of any union to participate and assume a functional role in any policy or decision making organ of the union except the function is strictly limited to administrative duties alone

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Trade Unions Amendment Act, 2005• The Act which was enacted in March, 05 provided for the

democratization of labour movement as well as granting freedom to employees to decide which unions they wish to belong.

• Some of its provisions are:o Membership of a trade union shall be voluntary and no employee

shall be forced to join any trade union or be victimized for refusing to join or remain a member

o The employer shall make deductions from the wages of every worker who is a member of any of the trade unions recognized in third schedule and remit such deductions to the registered office of the trade union

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• For the purpose of CB, all registered unions in the employment of an employer shall constitute an electoral college to elect members who will represent them in negotiations with the employer

• No person shall subject any other person to any kind of constraint or restriction of his personal freedom in the course of persuasion

• No person or trade union shall in the course of any strike action compel any person who is not a member of its union to join any strikeo Shall also not prevent aircraft from flying or obstruct public highway,

institutions or premises

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• No person, trade union or employer shall engage in a strike or lockout unless:o It is not engaged in provision of essential services

The arbitration provisions of the TDA shall apply in disputes affecting provision of essential services

o Strike/lockout concerns a dispute of rights Dispute of right means a labour dispute arising from negotiation,

application, interpretation or implementation of a CAo Strike/lockout concerns a dispute arising from collective and

fundamental breach of contract of employment or CAo A ballot has been casted and majority of members have

agreed to go on strike/lockout

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• Trade Disputes Act• The Act was enacted in 1976. It has the objective of

expeditiously settling trade Disputes.

• A trade disputes is any dispute between employers and workers or between workers and workers relating to the employment or otherwise or terms of/ conditions of employment of any person

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• Some other provisions include:o Parties must first settle differences by internal means

before resorting to external means

o The external means commences with declaration of trade disputes after which the following machinery is set in motion:MediationArbitrationAdjudication

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• There shall be no strike or lockout except the process in the Act has been followed

• Where a worker takes part in a strike he shall not be entitled to wages for the period. If the employer locks out, he shall pay the worker for the period

• The National Industrial Court has exclusive jurisdiction

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Correlation between law and practice

Practice

Yes No

Justified Vary practice Amend law

Justified

Yes/No

Justified

Yes/No

Justified by law?

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Finally…..

• Remember:o Law is about conditioning behavior. It is a means to

a social end and every part of it must constantly be examined and judged in the light of its purpose and effect.

o The workplace will experience industrial peace and harmony when all parties obey the laws and play the game according to the rules.

APPRAISAL OF THE NIGERIA LABOUR LAW

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