Enforceability of Collective Agreement Vis a Vis Section 254c(j)(i) of the Constitution of the Federal Republic of Nigeria, 1999 (as Amended)
Ikechukwu James Orji LLB., BL.,
Agreement is an essential part of human existence and coexistence. The holy scriptures alluded to this assertion in Amos chapter 3 verse 3 when it asked a rhetorical but very salient question: ‘can two work together, except they agreed?’. This echoes the importance of agreement, in human coexistence and corporation.
In industrial relationship, agreements are reached for the benefit of the employer, employee and in other to enhance effective production goods and delivery of service. One of such agreements are collective agreements. Collective agreements are terms entered by trade unions on behalf of its members with employers or association of employers. This article seeks to address the question of the enforceability or otherwise of collective agreement.
Contractual agreements are often between two parties; the offeror and the offeree. However, there are instances where contracts involve three parties such as guarantee contract, trusteeship, etc. there are other instances when contracts are reached on behalf of another, such as agency agreements and collective agreement, which is the focus of this work. Collective agreement is a kind of agreement reached by a few on behalf of a greater number of people who elected or selected those few to advance their interests. The Labour Act, particularly Section 91 of the Act, defined collective agreement as “an agreement in writing regarding working conditions and terms of employment concluded between;
- An organisation of workers or an organisation representing workers (or an association such organisations) of the one part; and
- An organisation of employers of employers or an organisation representing employers (or an association such organisations) of the other part.”
The way in which a Trade Unions reaches agreement with employers of labour is through collective agreement. Collective agreement simply put is any agreement made in whatever way and in whatever form by and on behalf of trade unions and employers. It is also the process through which the antithetical interests of employers and employees are harmonized through discussions and negotiations. Consists of negotiations between an employer and a group of employees so as to determine conditions of service. Employees are often represented in bargaining by an elected group or body, called a union or other labour organisation. Collective bargaining is usually regulated by federal laws and by administrative agency regulations and judicial decisions. Generally, employees have a right to collectively bargain and join trade unions and this is generally applicable to both public and private sector. It may be defined as the process of working out a modus operandi between two parties – employer and trade union organizations in matters relating to both parties. Or it may be seen as the process through which a Labour Union and an employer negotiate the scope of the employment relationship. Its ultimate goal is entering into a collective agreement. This will typically contain but is not limited to the following: wages, work hours, benefits, handling of disputes, other employment terms and employment centred issues.
Justiciability and Enforcement of Collective Agreement
Over the years the legal significance of a collective agreement has always been uncertain. The reason for this is the doctrine of privity of contract. Courts have held that employees on whose behalf these terms are entered are not privy to the contract, therefore cannot ask the court to enforce same. Also trade unions that enter this contract cannot go to court to enforce it against individual employers that renege. The courts declared that they were handicapped and cannot be invited to enforce collective agreements. Some courts have called it a mere gentlemen’s agreement, unenforceable at law; it has been likened to a treaty between parties that becomes enforceable by the parties themselves taking steps to execute it and give it the characteristics of a legally enforceable document.
In Nigeria Arab Bank Ltd. V Shuaibu Ndoma-Egba described a collective agreement to “at best a gentleman’s agreement, an extra legal document totally devoid of sanctions, it is a product of trade unionist pressure”.
In quite a number of Nigerian cases collective agreement have suffered the setback of justiciability or enforceability. The courts were never ready to enforce a collective agreement unless it is incorporated into the relevant employees contract of employment in fortifying this position Uwaifo JCA (as he then was) in Union Bank Plc v Edet stated thus “collective agreement except where they have been adopted as forming part of the terms of the terms of employment are not intended to give or capable of giving individual employees a right to litigate over an alleged breach of their terms as may be conceive by them to have affected their interest nor are they meant to supplant or even supplement their contract of service.
In addition to the above Akintan JCA in his concurring opinion said “it is definitely necessary to adopt the provisions of the document either in the letter of appointment or in a subsequent communication varying the terms of employment before the employee can enforce its content against the employer.
For Hon Justice Dennis Onyejife Edozie, JCA in the case of ACB PLC v. Nbisike
” Much of the procedure of this collective bargaining is governed by practice, not strict law and there is no legal compulsion on either the employees or the employers to enter into collective bargaining except in the case of certain public boards or corporations. There is no reported case on the legal status of such a collective agreement and the majority opinion of those concerned with such agreements is that they are not intended to create legal relations. This means that they are binding in honour only, and that their enforcement must depend on industrial and political pressure.”
However, the tide started to turn in the case of Corporative & Commerce Bank Nig. Ltd. V Okonkwo. In this case employee’s appointment was terminated based on a provision of a collective agreement. In challenging the termination of appointment in court, the employee relied on the provision of the said collective agreement, the employer objected to it contending that the collective agreement is not enforceable in law. Akpabio JCA discountenancing the objection held that the employer is estopped from objecting the enforceability of the collective agreement.
Curiously the court linked the enforceability of the collective agreement to the equitable principle of estoppel. In essence the court was saying that where an employer has agreed to use the terms of the collective agreement with respect to its employee such employer would not be permitted to deny or avoid the effect of the said collective agreement. In other words, the employer will not be allowed to approbate and reprobate at the same time. Therefore, collective agreement was largely still unenforceable.
The only condition when collective agreements will be enforced, before the third alteration of the 1999 Constitution of the Federal Republic of Nigeria, is when the terms of the collective agreement has been subsumed into his/her contract of employment.
The court in African Continental Bank v Nwodika Ubeazone JCA stated that the bindingness of a collective agreement depends on the following:
- The incorporation of the collective agreement in the contract of service if one exist;
- The state of the pleadings;
- The evidence before the court, and
- The conduct of the parties.
The Arrival of the New Dawn
Relief was brought to employees, employers and trade union after the enactment of the Constitution of the Federal Republic of Nigeria (Third Alteration) Act, 2010. This made provision for Section 254(C)(1)(j)(i). it provides thus;
254(C)(1)- Notwithstanding the provisions of Section 251, 257, 272, and anything contained in this Constitution and in addition to such other jurisdiction as may be conferred upon it by an Act of the National Assembly, the National Industrial Court shall have and exercise jurisdiction to the exclusion of any other court in civil causes and matters-
(j) relating to the determination of any question as to the interpretation and application of any-
(i) collective agreement
From the community reading of the above provision, the Constitution has empowered the National Industrial Court to interpret and apply collective agreements. That is, the court which hitherto had no jurisdiction to adjudicate or enforce contracts contained in a collective agreement can now interpret and enforce same.
This position got judicial blessings in the most recent case of NUHPSW v. Outsourcing Services Ltd. The court, Per Muhammad Ibrahim Sirajo, JCA, held thus;
“It is instructive to note that the contention of the Appellant was that its individual member’s contract of employment has been replaced by the collective agreement in the instant case. Having taken considerable time to look into the terms contained in the collective agreement executed by the parties from the standpoint of the provision of Section 254C (j)(i) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended), (the 3rd Alteration Act), relied on by the learned trial Judge, I am of the respectful opinion that the collective agreement is both enforceable as well as justiciable. 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”. The learned trial Judge recognized and took the liberty of it when it held thus: “The defendant has argued that a collective agreement is not justiceable. Section 254C (j)(i) of the 1999 Constitution, as amended, has conferred this Court with exclusive jurisdiction “relating to the determination of any question as to the interpretation/application of any collective agreement”. The power of interpretation and application of collective agreement approximates the power to declare as to the nature of rights, privileges and obligations existing under the collective agreement. By virtue of constitutional powers of interpretation and application, a collective agreement is Justiceable and enforceable.” 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)….”
From the above decision, trade unions and employees can now breath a sign of relief as terms in collective agreement can now be enforced by the court of law.
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