Court Limits Employer’s Right to Terminate: No Room for Oppression in Dismissals

1. Introduction

Employment is more than a contract; it is the foundation of livelihood, dignity, and professional identity. When termination is carried out recklessly, maliciously, or in a defamatory manner, the consequences extend far beyond loss of income. Such dismissals can amount to wrongful termination, trigger malicious prosecution, and inflict reputational injury that may render the employee unemployable.

This edition of the legal illumination of Akintunde Esan (The Legal Adviser Online) is a review of the land mark case of Mrs. Tamar Adigbonun v. Eko Electricity Distribution Plc which is a new judicial thinking that, damages in employment cases are no longer restricted to salary in lieu. A Claimant is entitled to damages for emotional distress, reputational harm, and loss of future earnings caused by unlawful dismissal or termination of employment.

Mrs. Tamar Adigbonun v. Eko Electricity Distribution Plc
National Industrial Court of Nigeria (NICN)
Lagos Judicial Division
Suit No.: NICN/LA/546/2014
Judge: Hon. Justice J. D. Peters
Date of Judgment: July 17, 2017

2. Core Principle Established:
The common-law right of an employer to “hire and fire” is not absolute. An employer cannot terminate an appointment in a “harsh, oppressive, and degrading manner.” When it does, the employee is entitled to damages that extend far beyond mere salary in lieu of notice, encompassing injury to reputation, feelings, and mental anguish.

3. Factual Background

a) The Employee: Mrs. Tamar Adigbonun was a Principal Manager at Eko Electricity Distribution Plc, a senior-level employee.

b) The Allegation: The company alleged that she was involved in fraudulent activities concerning the payment of a contractor.

c) The Employer’s Action:

• Reported her to the Nigerian Police Force as a suspect in the fraud.

• This led to her arrest, detention, and a prolonged police investigation.

• The matter was sensationalized in the media, causing public embarrassment.

d) The Exoneration: After a thorough investigation, the Police concluded that there was no evidence whatsoever to link Mrs. Adigbonun to the alleged fraud. A legal advice from the Ministry of Justice also confirmed her innocence.

e) The Dismissal: Despite her clear exoneration by the state authorities, Eko Electricity proceeded to terminate her employment, citing the same unproven allegations of “gross misconduct” that had been discredited.

4. The Court’s Holding & Legal Reasoning:

The Court found in favour of Mrs. Adigbonun and awarded her significant damages. The reasoning is a critical departure from the traditional “hire and fire” doctrine.

a. Rejection of the Absolute “Hire and Fire” Rule: The Court explicitly held that while an employer has the right to terminate a contract of employment, this right “cannot be exercised by the employer in a harsh, oppressive and degrading manner.”

b. The Court stated that the Defendant (Eko Electricity) could not “be allowed to hide under the cloak of ‘hire and fire’ to terminate the claimant’s appointment in the manner it did in this case.”

c. The “Manner of Dismissal” is Actionable: This is the most significant aspect of the judgment for your case. The Court separated the fact of dismissal from the manner of dismissal.

d. The Court found that the act of publicly accusing her of fraud, setting the police on her, and then dismissing her based on those discredited allegations was “utterly careless of her feelings and pride” and was “oppressive, disgraceful and unpleasant.”

e. The employer’s conduct was deemed a fundamental breach of the implied duty of trust and confidence.

f. The court awarded damages not just for the wrongful dismissal itself, but specifically for the injury to her reputation, feelings, and the mental anguish she suffered.

g. The judgment emphasized that the employer proceeded with the dismissal even after receiving the police report exonerating her. This demonstrated bad faith and made the dismissal particularly malicious.

Conclusion

This case serves as a powerful reminder that the right to terminate employment must never be wielded as a weapon of intimidation or humiliation. Employers are expected to act with integrity, ensuring that dismissal decisions are grounded in fairness and due process rather than personal vendettas or oppressive tactics.
For HR professionals and business leaders, the lesson is clear: safeguarding employee dignity is not just a moral obligation but a legal one. By respecting these boundaries, organizations can foster trust, reduce litigation risks, and build workplaces where justice and respect truly prevail.

Whether you are an employer or employee you can contact or chat with Akintunde Esan (The Legal Adviser Online) for further legal illumination or legal advice on employment law issues in Nigeria.