WHEN CAN AN EMPLOYER BE LIABLE TO HIS EMPLOYEE IN NIGERIA UNDER A CONTRACT OF EMPLOYMENT

Know when an employer can be liable to his employee under a contract of employment.

CORPORATE LAW PRACTICE IN NIGERIA

CHAMAN LAW FIRM

3/1/20227 min read

WHEN CAN AN EMPLOYER BE LIABLE TO HIS EMPLOYEE IN NIGERIA UNDER A CONTRACT OF EMPLOYMENT

INTRODUCTION:

The contract of employment is specie of contract, and is therefore governed by general principles of the law of contract, consensus sad item, Being a kind of simple contract, contract of employment must also satisfy the elements of a valid contract.

WHO IS AN EMPLOYER: Although this has no precise meaning in law; ’’An employer is any person who has entered in to contract of employment to employ any other person as a worker her for himself or for the services of any other person and includes the agents, manager, or factor of that first mentioned person and the personal representatives of a deceased employer.”The employer could be an individual, a partner, a corporate body or even a state (the Government).

WHO IS AN EMPLOYEE?

Any person who has entered in to or works under a contract with an employer whether the contract is for manual labor or clerical work or express or implied or oral or written, and whether it is a contract of service or a contract personally to execute any work or labor but does not include…………… persons exercising administrative, executive, technical or professional functions as public officer or otherwise.”

WHAT IS VICARIOUS LIABILITY?

The tort doctrine that imposes responsibility upon one person for the failure of another, with whom the person has a special relationship (such as Parent and Child, employer and employee, or owner of vehicle and driver), to exercise such care as a reasonably prudent person would use under similar circumstances.

ELEMENTS OF THE TORT OF VICARIOUS LIABILITY

1. A TORT BY THE EMPLOYEE:

The plaintiff must prove that the employee’s act satisfies all the elements of the particular tort alleged. For example Mr A cannot sue Employer B alleging that employee C defamed him when there was no publication of the defaming article.

The plaintiff need not pinpoint the particular servant(s) once it has been established that the servant committed the tort E.g. E.g. if a Dangote truck carrying sugar crashes into a filling station and causes an explosion, Dangote Industries (rather than the driver who may probably be dead) may be liable for the loss occasioned. Claimants do not necessarily need to identify the driver for Dangote to be liable provided the circumstances and justice of the case thereto dictates.

2. THERE MUST BE A MASTER-SERVANT RELATIONSHIP:

Lord Denning noted, that it is easier to identify a master-servant relationship than to describe/define it. Various tests have been suggested to construe/determine whether a master-servant relationship exists.

The control test: this test looks at the degree of control exercised. If the employer can determine what is done and how it is to be done, a master-servant relationship would be construed. But if he cannot, then the tortfeasor (i.e. the person that committed the tort) may be regarded as an independent contractor who is a master of his own. In Collins V Hertfordshire, a consultant surgeon was seen as an independent contractor. With the evolution of mankind and specialisation, the control test runs into hitches in its application to professionals like pilots, doctors, lecturers, etc. Then we have;

The organisational Test (Business integration): Lord Denning in Stevenson, stated that where the work of the servant is integrated into the organisation, he can be seen as an employee. Thus, professionals like doctors, lecturers, etc. who are integrated into an organisation are servants notwithstanding that they cannot be told how to do their work. Therefore, a hospital may be sued for the negligence of one of its doctors. This test too may fall into hitches.

The multiple test: This is the modern test. It was suggested that in addition to the control test and organisational test, we should look at the terms of the contract and also ask the following (in order to determine whether there is a master servant relationship); who provides the materials, who hires, who remunerates, who has power of dismissal…?

Please don’t confuse yourself, to determine whether there is a master servant relationship, you look at the facts and circumstances of each case and then utilise the above tests for direction where confused.

Now an issue may arise in cases where servants are Lent I.e. “Lending a servant”. Where A lends his servant (Mr Saka) to B and a tort is committed by Mr C who should be liable? For example; when you walk into UBA, Gtb, etc… you see security guards. Do you know that those guards were provided by a guard company e.g. Kings Guard Ltd. They were not directly recruited by GTB. Gtb pays the guard company which then pays their guards which they deployed to Gtb. If one of the guards assaults a customer, should you sue Gtb or Kings Guard Ltd?

In Mersey Docks and Habour V. Coggins and Griffiths, the board provided their employee and crane to a firm. While loading a ship, the hired servant injured a person. The general employer was held liable because they retained the power of dismissal and paid wages. General employer was also held liable in Rotimi V Adegunle. While in Hawley v. Luminar leisure ltd, the hiring employer of a night club was held liable because it was only labour that was hired.

Lord Rix in Viasystems (Tyneside) V Thermal Transfer (Northern) Ltd, submitted that either the general employer is liable or the hiring employer or both of them should be liable. In this case, both employers were held jointly liable. However, in Blackwater V Plint… and the case of; Various claimants V the Catholic Child Welfare Society; institute of the brothers of Christian schools, joint vicarious liability was rejected.

3. THE TORT SHOULD HAVE BEEN COMMITTED IN THE COURSE OF EMPLOYMENT:

Salmond in his treatise posits that a wrong is committed “within the course of employment” if;

If it is expressly authorised by the employer: if what the employer instructed the employee to do amounts to a tort.

If it is an unauthorised way of doing what the employee was authorised to do:

E.g. looking at the earlier Dangote scenario. The employee would have been authorised to deliver the truck of sugar but not to overspeed. In fact, on some trucks like that, they write a speed limit. That DOESN’T mean that the employer cannot be liable for the loss caused from an accident due to the employee’s over speeding. (Pardon my English).

In Century Insurance Co V Northern Ireland Road Transport Board, the employer was vicariously liable where his driver struck a match while transferring petrol from the tanker to a reservoir and an explosion ensued. In Popoola V Pan African Gas Distributors Ltd, a similar conclusion was reached on similar facts. In Limpus V London General Omnibus Company, vicarious liability was construed where the employee, contrary to express prohibition raced with the employer’s bus and had an accident. In Canadian Pacific Railway Company V Lockhart contrary to company policy too, the employee drove an uninsured car and injured the plaintiff. Held, employers were still vicariously liable.

But where the employee is not within the scope of his employment, the employer may not be liable. For example; in Beard V London General Omnibus Company, a conductor drove a bus and injured the plaintiff was held to be acting outside his scope as he was employed as a conductor not a driver. Thus personally liable. Jarmakani Transport ltd V Abeke; A servant of the defendant had disobeyed instructions and taken a passenger aboard the lorry. On the lorry, was the inscription; “passengers not allowed” Court held he was employed to carry goods not passengers.

If the act/incident is incidental to his employment:

In Smith V Stages, employees were sent to another jurisdiction to work. On the way there was a crash and employers were liable as they were moving to the place on employer’s instruction. You can read this full case to see the application of policy considerations (if you have the time) In Poland V John Parr and sons Ltd, vicarious liability was imposed where employee assaulted a boy he thought was stealing from his employer’s goods. The nature of his job requires thieves to be warded off. In Staton V NCB, the court held that cycling across the employer’s premises after work to collect wage was incidental to the employment.

Note however that if the employee detours (i.e. is on a frolic of his own), the employee may not be liable. E.g. where madam tells the driver to go from Yaba and pick the children at Unilag Staff School, Yaba and he drives to Lekki and has an accident with Madam’s car in Lekki? Or the Dangote Driver was to deliver the Sugar from Lagos to Ogun but we hear that the same driver crashed the truck in Ghana. Can we say that he was still within the scope of his employment?

The answer is that we must look at the degree and purpose of the detour. Also, Williams V Hemphill[25], where the children of the employer asked the driver to go to another place (detour) the court held that it was within the course of his employment since he was instructed by his employer’s children and was not on a frolic of his own.

In Conclusion, my honest suggestion is that you should not be carried away by the cases. Just reflect on the main principles i.e. the headings, sub-headings and notes. The cases are numerous and have conflicting decisions. One judge may say this and another may say something else when confronted with the same facts. At best, the cases should just serve as an example and can be used in the exam when explaining your position.

REFERENCE:

1. Labor Act, cap 14, LFN, 2004, Section 91.

2. Labor Acts, cap 14, LFN 2004, section 91.

3. https://legal-dictionary.thefreedictionary.com/vicarious+liability.

4. Cassidy V Minister of Health [1951] 2 KB 343, CA.

5. Salmond on tort.

6. Collins v. Herts C.C., tl947] 1 All E.R. 633.

7. Cooke J in Market Investigations V Minister of Social Security [1969] 2 QB 173.

8. Jordan and Harrison Ltd V McDonnell and Evans ltd [1952] 1 TLR 101.

9. Ready Mixed Concrete V Minister of Pensions and National Insurance [1968] 2 QB 497, Ferguson V Dawson [1976] 3 All ER 817.

10. [1946] 2 All ER 345 HL.

11. (1959) 4 FSC 19.

12. [2006] Lloyd's Rep IR 307.

13. [2005] EWCA Civ 1151.

14. [2001] IndigLawB 73.

15. [2012] UKSC 56.

16. (1942) 72 Ll.L.Rep. 119. HOUSE OF LORDS.

17. (1972) ALL NLR 831.

18. (1862) ER 859.

19. [1942] A.C. 591 at 599 (P.C.).

20. [1900] 2 QB 530.

21. [1963] 1 All N.L.R. 180.

22. [1989] AC 928.

23. [1927] 1 K.B. 236 (Coturt of Appeal).

24. [1957] 1 W.L.R. 893.

25. [1966] 2 Lloyd's Rep. 101.

26. Whatman v. Pearson (1868) L.R. 3 CP. 422, Heasmans v Clarity Cleaning Co [1987] ICR 949, Storey V Ashton [1869] LR 4 QB 476.

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