Court Declares Chan Medi Pharm Dismissal Wrongful, Orders Payment of Ex-Staff’s Entitlements
The National Industrial Court of Nigeria, sitting in Jos, has declared the dismissal of Mr. Igwe by Chan Medi Pharm wrongful, null and void, ruling that the company issued the dismissal letter after his employment had already ended.
The court, presided over by Justice Ibrahim Galadima, held that Igwe’s resignation became effective in April 2021 upon the expiration of his one-month notice, bringing his employment relationship with the pharmaceutical company to a lawful end.
Consequently, the court ordered Chan Medi Pharm to pay Igwe N406,000 as gratuity, N712,000 in cooperative deductions and N500,000 as general damages. It also directed the company to remit N316,000 into his pension account and pay N8,000 to the relevant tax authority.
Igwe had told the court that he submitted his resignation letter in April 2021, giving the company the required one-month notice, which expired that same month. He maintained that he was no longer an employee of Chan Medi Pharm after the notice period ended.
However, the company reportedly issued a memo rejecting his resignation, citing his failure to provide his personal account for an investigation. Igwe alleged that Chan Medi Pharm subsequently disregarded his resignation and issued him a dismissal letter.
He argued that the company’s refusal to pay his outstanding entitlements caused him financial hardship and emotional distress. He subsequently instituted legal proceedings, seeking to have his dismissal set aside, recover his outstanding entitlements and obtain general damages, interest and costs.
In its defence, Chan Medi Pharm argued that Igwe was a person of interest in an ongoing audit and investigation into alleged irregularities in the company’s management and financial affairs.
The company maintained that its refusal to accept his resignation was justified because he was under investigation, adding that it viewed his decision to resign as an attempt to evade scrutiny.
Chan Medi Pharm further argued that Igwe remained its employee until his eventual dismissal because he knew his resignation had been rejected before his notice period expired.
The company urged the court to dismiss the suit, contending that its actions were justified by Igwe’s alleged failure to cooperate with the audit and investigation, as well as his alleged abscondment from duty.
Delivering judgment, Justice Galadima held that resignation constitutes a voluntary relinquishment of employment and, unless the employment contract provides otherwise, becomes effective once an employee complies with the required notice period. He added that an employer’s acceptance is not necessary for a valid resignation to take effect.
The court noted that neither the appointment letter nor the subsequent documents presented before it contained any provision making Igwe’s resignation conditional on the company’s acceptance or the conclusion of an investigation.
Justice Galadima ruled that an employer could not unilaterally override a valid resignation by issuing a letter rejecting it when the employee had complied with the contractual notice requirements.
The judge further held that the investigation into alleged financial irregularities did not invalidate Igwe’s resignation, noting that Chan Medi Pharm failed to establish any legal basis for suspending its effect.
According to the court, once Igwe’s employment ended in April 2021, there was no longer an employment relationship upon which the company could rely to issue the dismissal letter dated June 2021.
However, Justice Galadima held that Igwe failed to sufficiently establish his claims for salary differentials and leave allowance, although he proved his entitlement to gratuity and cooperative deductions.
The court also found that Igwe demonstrated that his pension contributions had not been fully remitted and that tax deductions from his earnings had not been paid to the relevant authority as required.
Justice Galadima further held that issuing a dismissal letter after an employment relationship had already ended was a serious and injurious act capable of stigmatizing Igwe and damaging his reputation and standing after leaving the company.
