What is redundancy in Nigeria?
The Nigerian Labour Act (the Act) describes redundancy as an involuntary and permanent loss of employment caused by an excess of manpower. In other words, redundancy is a unique form of termination of employment by an employer. The Act does not provide a guide as to the events that could lead to termination due to excess manpower. However, factors such as acquisition of a company, restructuring of an existing company, reduction or closure of business operations, or a reduction in production lines due to shortage of materials, or in the age of digitization - a change from manual to automated processes, requiring fewer staff, etc. could be considered as valid grounds for redundancy.
Is redundancy legal in Nigeria?
Yes, redundancy is legal in Nigeria, in that it is recognized by the Act and Nigerian Courts. In the absence of any express provision in the contract of employment, employers are required to follow certain provisions, procedures and requirements outlined in the Act to ensure that the affected employees are treated fairly during the process of redundancy. For employees that do not fall within the scope of the Act i.e., employees other than manual or clerical workers, employers are required to comply with the terms that are mutually agreed by the parties, which may include the adoption of the provisions, procedures and requirements in the Act.
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