NATIONAL UNION OF HOTEL & PERSONNEL SERVICES WORKERS V OUTSOURCING SERVICES LIMITED

Legalpedia Citation: (2023-07) Legalpedia 06787 (CA)

In the Court of Appeal

Holden At Lagos

Mon Jul 17, 2023

Suit Number: CA/L/565/2013

CORAM

Obande Festus Ogbuinya JCA

Frederick Oziakpono Oho JCA

Muhammad Ibrahim Sirajo JCA

PARTIES

NATIONAL UNION OF HOTEL & PERSONNEL SERVICES WORKERS (NUHPSW) (For Themselves And On Behalf Of The NUHPSW Warri Escravos/Swamp & Lagos Branches)

APPELLANTS

OUTSOURCING SERVICES LIMITED

RESPONDENTS

AREA(S) OF LAW

APPEAL, CONSTITUTIONAL LAW, CONTRACT, EVIDENCE, LABOUR LAW, PRACTICE AND PROCEDURE

SUMMARY OF FACTS

As stated earlier in this judgment, the Appellant, who was the Plaintiff in the lower Court, is a registered Trade Union. It initiated the action on behalf of some of its members who were in the employment of the Respondent, the Defendant in the lower Court and a company registered under the Nigerian law. The Respondent, at the material time, was engaged in an outsourcing contract with Chevron Nigeria Limited in some of its locations nationwide. The concerned members of the Appellant were those engaged by the Respondent in the said outsourcing contract with Chevron. They were said to have been duly employed and issued letters of employment to that effect. This was the state of affairs between the Respondents and the members of the Appellant in the Respondent’s employment, until June 2008, when the “Collective Agreement” was jointly executed between the representative of the parties. The grouse of the Appellant was that the Respondent reportedly refused to implement the terms agreed upon by the parties in the said agreement. To the foregoing contention, the Respondent was vehement in its argument that the said agreement had lived out its existence.

The lower Court bought into the Respondent’s line of argument and found that there was no collective agreement to be interpreted between the parties and consequently dismissed the suit. Displeased by the judgment of the lower Court, the Appellant initiated the instant appeal.

HELD

Appeal allowed

ISSUES

Whether or not the Collective Agreement entered into between the Appellant and the Respondent in June 2008 is justiceable and enforceable ab initio, and whether it is still operative?

RATIONES DECIDENDI

ISSUES FOR DETERMINATION – DISCRETIONARY POWER OF APPELLATE COURTS TO DETERMINE THE APPROPRIATE ISSUES FOR DETERMINATION

This Court, as an appellate Court, could either adopt, reframe and or outrightly reformulate the issues earlier formulated by the parties, with an issue that will resolve the dispute between the parties. – Per M. I. Sirajo, JCA

COLLECTIVE AGREEMENT – MEANING OF COLLECTIVE AGREEMENT

Section 48 of the Trade Dispute Act, 2004 provides that collective agreement is:

“Any agreement in writing for the settlement of the dispute and relating to terms of employment and physical condition of work concluded between:

1. a) An employer, a group of employers or organizations representing workers or the duly appointed representative of any body of workers, on the other hand and

1. b) One or more trade unions or organizations representing workers or the duly appointed representative of any body of workers, on the other hand”.

Under Section 91 of the Labour Act, 2004, the concept of the collective agreement is said to be:

“An agreement in writing regarding working conditions and terms of employment concluded between:

1. a) An organization of workers or an organization representing workers (or an association of such organization) of the one part and;

1. b) An organization of employers or organization representing employers (or an association of such organization) of the other part”.

From the provisions of the relevant statutes quoted above, it gives no room to entertain any doubt that collective agreement is basically between the employer of labour and the union representing the workers and it must be in writing for the settlement of the dispute and relating to terms of employment, that is, regarding working conditions and terms of employment concluded between such parties. – Per M. I. Sirajo, JCA

CONTRACT OF EMPLOYMENT – MEANING OF CONTRACT OF EMPLOYMENT

The contract of employment, on the other hand, is described in the said Section 91 of the Labour Act, as “any agreement, whether oral or written, express or implied, whereby one person agrees to employ another as a worker and that other person agrees to serve the employer as a worker”. It is no doubt, from the statutory description of what amount to a collective agreement and a contract of employment, that the two concepts differ, though may set out to achieve the same objective. I am in agreement with the learned trial Judge that the contract of employment amounts to the legal basis of engagement between the employee and the employer, and that the relationship, being contractual, would be subject to some sets of pre-agreed terms to regulate the relationship – Per M. I. Sirajo, JCA

COLLECTIVE AGREEMENT – EXCLUSIVE JURISDICTION OF THE NATIONAL INDUSTRIAL COURT IN DETERMINING MATTERS THAT RELATE TO COLLECTIVE AGREEMENT

Section 254C (j)(i) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended), (the 3rd Alteration Act)… I find the said constitutional provision apt and is hereby paraphrased hereunder:

“The National Industrial Court shall have and exercise jurisdiction to the exclusion of any other Court in civil causes and matters relating to the determination of any question as to the interpretation and application of any collective agreement. In the said provision, the jurisdictional frontiers of the lower Court, the National Industrial Court of Nigeria, was expanded to, inter alia, hear and determine questions bordering on “Collective Agreement” as in the instant case. It is important to note that this power granted the lower Court is “to the exclusion of any other Court”. – Per M. I. Sirajo, JCA

COLLECTIVE AGREEMENT – POWERS OF THE NATIONAL INDUSTRIAL COURT TO INTERPRET AND APPLY TERMS OF A COLLECTIVE AGREEMENT

In the argument canvassed on behalf of the Respondent, in this regard, counsel must have been oblivious of this sweeping constitutional power with which the National Industrial Court of Nigeria is clothed, to the exclusion of any other Court, to hear and determine the nature of the instant question. The constitutional dispensation moved the jurisdiction of the lower Court past the realm of mere interpretation, to include enforcement; id est, the determination of the question as to the “interpretation of any collective agreement”.

See Section 7 Subsection (1) (C)(i) of the National Industrial Court Act, 2006.

It needs to be unequivocally stated that the above statutory provision and the majority of the decisions, on which the Respondent placed its reliance, were pre-alteration positions of the law, when the provision of Section 7 of the NICN Act, 2006 held sway. The advent of the Alteration Act, of the 1999 Constitution, could be validly likened to a game changer when the hitherto unenforceable agreement becomes justiciable. But prior to the Alteration Act, the doctrine of privity robbed collective agreement of its enforceability, except and until such time when the terms of the agreement are incorporated into individual members’ contract of employment. See Osoh & Ors V Unity Bank Plc (supra), also reported as (2013) LPELR-19968 (SC).

This power of the lower Court to interpret and apply terms in a collective agreement, is further reinforced in Section 254C(1)(b) of the Third Alteration Act, of the 1999 Constitution, as amended, over civil matters or causes which relate to or in connection with, or arising from Factories Act, Trade Disputes Act, Trade Unions Act, Labour Act, Employees’ Compensation Act or any other Act or Law relating to labour, employment, industrial relations, workplace or any other enactment replacing the Acts or Laws. See Osoh &  Ors vs. Unity Bank Plc, and Rector, Kwara Poly vs. Adefila (supra). – Per M. I. Sirajo, JCA 

INTERNATIONAL BEST PRACTICE – DUTY OF COURTS TO CONSIDER INTERNATIONAL BEST PRACTICES IN DETERMINING LABOUR MATTERS

The provision of Section 3 (3) of the Trade Dispute Act, in my opinion, is an administrative approach set in place to compel adherence to terms of an agreement freely entered into by parties, especially in the Pre-Third Alteration Act era, as it relates to labour matters. The Court takes judicial notice of countless labour-related animosities which may hamper industrial relations if left to fester, hence the enactment.

Let me say at this juncture that part of the novel idea introduced in the third alteration is in the area of international best practices, which Section 254 (1)

(f) of the Third Alteration Act makes provision for. The section provides:

“(f) relating to or connected with unfair labour practices or international best practices in labour, employment and industrial relation matters;

(h) relating to, connected with or pertaining to the application or interpretation of international labour standards.

It becomes imperative to state the foregoing as the contemplation of the drafters appears more in their preference for the lower Court, the National Industrial Court of Nigeria, to take a proactive stance in ensuring that the nation will not be left out in the reckoning of the comity of nations in the area of robustly flourishing labour practices and industrial relations. This Court, while expatiating the law in this regard in the case of Sahara Energy Resources Ltd vs. Olawunmi Oyebola (2020) LPELR-51806(CA), per Ogakwu, JCA., held that:

“The above provisions enjoin the National Industrial Court in the exercise of its jurisdiction, to “have due regard to good or international best practices in labour or industrial relations”. The importance of this novel provision, in my deferential view, is that the National Industrial Court in considering the measure or quantum of damages is to do so in accordance with “good or international best practices in labour or industrial relations”, which shall be a question of fact. It will be stating the obvious to say that prior to the Third Alteration, when employment and labour matters were handled by the High Courts, there was no obligation to apply and follow good or international best practices. It is an innovative provision which seems to be directed at enthroning an entirely new employment and labour jurisdiction. …….”

The Court, in the cited case, was determining a different head of legal question, the measure of damages awardable in the event of a breach. The Court hereby reiterates that the clarion call is to the stakeholders in labour and industrial relations, to strive in order to conform with the international best practices as obtainable in the field. – Per M. I. Sirajo, JCA

INTERNATIONAL LAWS AND PRACTICES – POWERS OF THE INDUSTRIAL COURT TO APPLY INTERNATIONAL LAWS AND PRACTICES IN LABOUR MATTERS

My Lords, in the course of preparing the instant judgment, I came across and digested, albeit, with a persuasive mindset, the judgment of Oji, J., of the Lagos Division of the lower Court which bore some similar question of law, I find it relevant and am inclined to curl out some portion of the said judgment herein. In that case, the learned Judge was determining the legal question of enforceability and justiciability of a collective agreement having regard for international best practices, where he stated that:

“Once a valid collective agreement is shown to have been entered into between legal parties; that agreement becomes applicable, in favour of those expressed to be covered by the said instrument. In the interpretation and application of collective agreements, this Court is enjoined to go beyond itself, and apply international law and practices. The power, having been granted prior to Section 254C(1)(j) by Section 254(1) (f & h). The two sub-paragraphs provide as follows:

(f) relating to or connected with unfair labour practices or international best practices in labour, employment and industrial relation matters;

(h) relating to, connected with or pertaining to the application or interpretation of international labour standards.

29. Without finding the need to consider the implications on ‘unfair labour practice’, as this was not addressed by parties; what then is the international best practices and the international labour standards, in the application of collective agreements?Nigeria has entered into several international commitments which pre-determine for her, the way collective agreements are to be regarded. For instance, the Convention on the Freedom of Association and Protection of the Right to Organise Convention No 87 of 1948, ratified by Nigeria in October 17, 1960, Collective Agreements Recommendation No. 91 of 1951, Collective Bargaining Convention No. 154 of 1981, Right to Organise and Collective Bargaining Convention No. 98 of 1949 ratified by Nigeria on 17th October, 1960. The Collective Agreements Recommendation provides that collective agreements should bind the signatories thereto, and those on whose behalf the agreement is concluded. This recommendation, though not a convention is evidence of international best practice. This Court is able to apply international conventions and treaties, even where not nationalized by virtue of Section 254C (2) which provides that:

Notwithstanding anything to the contrary in this Constitution, the National Industrial Court shall have the jurisdiction and power to deal with any matter connected with or pertaining to the application of any international convention, treaty or protocol of which Nigeria has ratified relating to labour, employment, workplace, industrial relations or matters connected therewith.”

The learned judge, cited and quoted extensively the decision of this Court in Sahara Energy Resources Ltd vs. Oyebola (supra).– Per M. I. Sirajo, JCA

CONTRACTS – THE BINDING NATURE OF CONTRACTS

In the absence of any allegation of fraud, misrepresentation, mistake and/or other vitiating factors, the contract which was freely signed by the party, binds the respective parties and same inures and spans with the parties’ contractual relationship. It is a settled law that parties are bound to honour, with the performance, the terms of the contract they freely entered into, this is aptly captured in the Latin maxim, Pacta Sunt Servanda. See A.G. Rivers State vs. A.G Akwa Ibom State & Anor (2011) LPELR-633 (SC), A.G. Nasarawa State vs. A-G Plateau State (2012) LPELR-9730 (SC). – Per M. I. Sirajo, JCA

COURTS – CONDUCT OF COURTS IN INTERPRETING CONTRACT

Courts are enjoined to interpret the contractual agreement submitted for it to determine and as made by the parties, and not to supplant its term in replacement for parties’ intentions. See Standard Nig. Engr Co. vs. Nigerian Bank for Commerce and Industry (2006) 25 NSCQR 654. – Per M. I. Sirajo, JCA

CONTRACT – CONDUCT OF COURTS IN INTERPRETING CONTRACTS

I am clear in my view and also align with the Appellant’s submission that neither parties nor Court can validly read extraneous matters not agreed on by the parties into the terms of an agreement to which they are bound. See Race Auto Supply Co. Ltd & Ors V Akibu (supra), BFI Group Corporation vs. Bureau of Public Enterprises (2012) LPELR-9339 (SC), Oforishe vs. Nigerian Gas Company Ltd (2017) LPELR-42766 (SC), Fidelity Bank Plc vs. Marcity Chemical industries Ltd & Ors (2022) LPELR-56866 (SC), NNPC vs Fung Tai Engineering Co. Ltd (2023) LPELR-59745 (SC). – Per M. I. Sirajo, JCA

CONTRACT – WHETHER A COURT CAN RECONSTRUCT A CONTRACT

By way of reiteration, the trial Judge was in error in his foregoing finding, it is settled law that Court is precluded from reconstructing the contract which was freely entered into by the parties in order to import into it terms not intended by the parties. The authorities cited above are on point. – Per M. I. Sirajo, JCA

JUDGEMENT – WHAT CONSTITUTES A PERVERSE DECISION OR JUDGMENT AND THE CONDUCT OF APPELLATE COURTS TO SUCH JUDGMENTS

Now, it is settled law that a decision may be perverse where the trial Judge took into account matters that he ought not to have taken into account; or where the Judge shuts his eyes to the obvious or where legal principles are wrongly applied to correctly ascertained facts. In any of such situations, the judgment from such proceedings is liable to be set aside on appeal in order to avoid a miscarriage of justice. See Aliyu vs. Namadi & Ors (2023) LPELR-59742 (SC), Abegunde vs. Ondo State House of Assembly & Ors (2015) LPELR-24588 (SC), Kelly vs. The State (2022) LPELR-57325 (SC), Okonkwo vs. FRN & Anor (2021) LPELR-58384 (SC). – Per M. I. Sirajo, JCA

CASES CITED

NIL

STATUTES REFERRED TO

1. Constitution of the Federal Republic of Nigeria 1999 (as amended)
2. Court of Appeal Rules
3. National Industrial Court Rules
4. Trade Dispute Act, 2006
5. Labour Act, 1971
6. Labour Act, 2004
7. Trade Dispute Act, 2004
8. National Industrial Court Act, 2006
9. Alteration Act, of the 1999 Constitution

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