It is common practice among Nigerian banks to set up bank deposit targets for their employees and make these targets the basis for their performance appraisal. Failure to meet up these targets could lead to the loss of some benefits being enjoyed as an employee of the bank or in a worst-case scenario, the termination of their employment. This practice has received widespread criticism following the effects and pressure on the employees to meet up these targets as some bank employees have had to resort to compromising methods. One of the most recent criticisms was seen in the decision of the National Industrial Court of Nigeria (“NICN”) in the matter between Miss Chinonye Amanze and Union Bank of Nigeria^[1] where the court described it as “unfair labour practice”. In this article, we shall take a cursory look at the decision of the court in this matter in line with the rules governing the contractual obligations between an employer and an employee.

ANALYSIS OF THE DECISION IN MISS CHINONYE AMANZE V UNION BANK OF NIGERIA

Miss Chinonye Amanze (“the Claimant”) was employed by Union Bank of Nigeria (“the Defendant”) as a Relationship Manager sometime in 2014. According to the defendant, the employment of the claimant was contingent upon satisfactory performance and meeting 100% of the set target. They also contended that this set target was based on a representation made by the claimant that she was in a position to achieve a minimum average monthly deposit from target customers in the sum of N600,000,000.00 (Six Hundred Million Naira only) and $250,000.00 (Two Hundred and Fifty Thousand Dollars). In addition to the monetary deposit, the claimant was expected to deliver to the defendant eight (8) specific customers and a commitment form was signed to this effect. Following the failure of the claimant to achieve these targets as set by the defendant, her employment was terminated. 

In delivering his judgment, the Hon. Justice (Dr.) I. J. Essien stated that “the practice where banks including the defendant impose deposit attraction limit on employees as a basis for the employees to continue in the employment is an anachronistic and slavish labour practice which run contrary to the tenets of best labour practices …. the practice where an employee is given deposit target by a bank or any other financial institution as a condition for his continuing in the employment by banks and other organization is an unfair labour practice and must be struck down. That practice is hereby outlawed. The defendant and indeed any financial institution in Nigeria cannot and must not impose any deposit attraction limit on any employee as a condition for continuing in the employment.” He went further to state that “…..it is a dangerous practice which violates the common law principle of duty to provide work by the employer ….. It has never been the duty of the employee to go looking for work to sustain the business of the employer except where the employee in such circumstances receives a commission by an agreement for that extra effort.”

The holistic effect of the above decision is that the setting of deposit targets by banks and other financial institutions as a basis for sustaining the employment of an employee is an unfair labour practice that has no basis under the law and should, therefore, be discontinued. Such contractual terms are to the extent of their inconsistency with best labour practices illegal. Again, the court noted that the duty to provide work is the responsibility of the employer and should not be passed on to the employee without any form of benefit.

In very simple terms, the implication of the decision of the NICN in the case under review is that the employment of an employee should not be reliant on the execution of deposit targets issued by an employer especially since the employer must provide work. The NICN resolved that such practice is illegal and should be outlawed. However, can we say that employment reliant on meeting a set target is illegal and an unfair labour practice as held by the NIC in the case under review? In analyzing the correctness or otherwise of this decision of the NIC, we shall carefully evaluate the decision in line with the applicable laws.

1. Unfair Labour Practice

In recent times, efforts have been made to protect employees from certain activities of their employers who are perceived to have stronger bargaining power in employment relations. These efforts have resulted in the enactment of legislations, conventions, recommendations and protocols which have been made to legally protect the workers. These laws provide for fairness and equity in employment relations in the workplace. A derogation from them would automatically result in unfair practice and therefore be considered detrimental to the employee.^[2] 

In the case under review, the court described the actions of the defendant as unfair labour practice. Unfair Labour Practice has been defined as an unfair act or omission that arises between an employer and an employee involving among others, the unfair conduct of the employer relating to the promotion, demotion of an employee or relating to the provision of benefits to an employee.^[3] The concept of unfair labour practice is not expressly provided for in the Nigerian Labour Law or any other local legislative enactment. The NICN under section 254C of the 1999 Constitution of the Federal Republic of Nigeria (as amended) is enjoined to adopt international best practices. This provision implies that the court can declare an act or omission as unfair labour practice even if the unfairness of such act or omission cannot be traced to any existing law in Nigeria so far such act or omission is short of international best practice which is what the court did in making its decision.

In trying to establish the practice of attaching an employee’s employment to deposit targets within the ambit of unfair labour practice, there is the situation of employees having to do whatever they are told to do by their employer and through whatever means just to secure their jobs. Meanwhile, common law provides that employees are under no obligation to submit to any position or duty that is unreasonable.^[4] Although, there could be the argument that the employee willingly accepted the terms of the offer and duly executed the contract of employment which is devoid of any vitiating element. Thus, implying that the employee was very much aware of the intricacies of the job being offered and was willing to execute it. In doing this, parties are ad idem on the rules governing their relationship. Also, it is trite law that courts are not to rewrite the contract of parties as they are bound by the terms of the contracts willingly signed. It has always been the nature of the courts not to interfere in such contracts.

Flowing from the above, it is safe to say that parties to such contracts are very much aware of what is expected from them, especially the employee. Therefore, some may argue that it is not the place of the court to interfere in such cases as long as the contract was not signed under any mitigating circumstances. However, the courts are there for a reason which is to safeguard the interests of those who may be deemed to possess a weaker bargaining power in a contract as can be seen in this instance.

2. Duty of the Employer to Provide Work

In the instant case, the court held that it was not the duty of the employee to look for work to sustain the business of the employer as this duty has been conferred on the employer. Section 17 of the Labour Act provides for the duty of the employer to provide work for his employee. However, this duty is not a rigid one as the court noted that this duty may be transferred to the employee where he is to be awarded a commission based on it for the extra effort. This means that the employee may decide to take up the responsibility of sustaining the business of the employer in exchange for receiving some form of benefit or commission from the employer.

In analyzing this decision of the court, one may decide to look at it from the angle that the setting up of deposit targets by the employer is not necessarily a transfer of his obligation to the employee. For instance, in the case of an employee who is employed to render the services of a marketer as seen in the case under review, such services will be deemed to be incidental to his duties as a marketer. A marketer in an organization must target prospective clients and devise a means of recruiting them for the organization. In setting up these targets, the employee is expected to devise the necessary means in which to engage the clients. Where the employee fails to discharge the obligations given to him, the resultant effect is a poor performance appraisal. Can we then say that the employer in these circumstances will be wrong to dismiss an employee who has failed to effectively discharge his duties?

It is pertinent to note that targets are usually set to assist the banks to achieve their strategic objectives. Banks in Nigeria use targets largely to push an employee to achieve organizational goals. These targets are tools of reciprocity in that while the banks aim for profits, the employees aim for intrinsic benefits. These benefits could range from the increase in salaries, bonuses and promotion. On the other hand, unrealistic and difficult targets exert pressure on the employees and negatively affect the employee and the bank due to low productivity that may occur during a period of health-related absence. They can also decrease employees’ commitment, create pressure and anxiety, leading to negative consequences on the employees.

CONCLUSION

 The decision of the NICN in the above case is a laudable one that seeks to protect the interests of an employee in a bank. Banks, financial institutions and other stakeholders in the banking industry are encouraged to take cognizance of this new development for their interest and the interest of their employees Flowing from the decision of the court in tangent with the negative effects of this practice on the employees, it will be in the interest of banks to seek proper legal advice while structuring the contractual terms of an employee to avoid a situation that will be deemed an unfair labour practice.

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^[1] NICN/LA/424/2018

^[2] Ofoha Chibuzo J.,”The Concept of Unfair Labour Practice and its applicability in Nigeria”

^[3] Aluko Ayobami Oluwaseun and Aderounmu Itunuoluwa, “Unfair Labour Practices in Labour Relations in Nigeria” International Journal of Politics and Good Governance Vol. 4, No. 10.1; Quarter I 2019

^[4] Cooper v. Stronge & W. Co. (126 N.W. 541, 111 Minn. 177)

Written by Chiamaka Anyanwu for The Trusted Advisors

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