The National Industrial Court has declared Mrs. Yinka Tunji-Ojo’s compulsory retirement by Odu’a Investment Company Limited as unlawful, and a violation of the company’s employee handbook.
Justice Dele Peters of the Ibadan Judicial Division made the declaration on Thursday while delivering judgement in a suit filed by Mrs Tunji-Ojo.
The court ruled that the retirement breached contractual terms, ordering Odu’a Investment to pay Mrs. Tunji-Ojo the sim of N83,032,827.16, representing salaries and emoluments for the remaining 40 months she would have served until the mandatory retirement age of 60.
However, the court directed Mrs. Tunji-Ojo to repay N3,165,576.00 for an outstanding loan from the Cooperative Society and N649k, 75% of the carrying cost of the assigned car.
Background
Mrs.Tunji-Ojo stated she joined Odu’a Investment on March 15, 2001, as a Manager, progressing to General Manager, Finance and Investment, near the top of the company’s hierarchy.
She said her employment was terminated in 2020, at 56, after crossing the age of 45, which is the voluntary retirement age.
While under cross examined, She mentioned repaying Seventeen Million Naira, sent as entitlement, and =N=2.7 Million credited as 3 months’ basic salary in lieu of notice, urging the court to grant the sought reliefs.
Odu’a Investment Ltd defended the compulsory retirement, stating it aligned with the Employee’s Handbook, and that the Claimant received three months’ salary in lieu of notice.
The organization’s Investment emphasized that upon turning 45, an employee may retire voluntarily or be retired by the Defendant, asserting clarity in the activated clause for Mrs. Tunji-Ojo’s retirement.
Odu’a counsel added that she held onto her retirement entitlement for a month before returning it, maintaining that the retirement was wrong, and argued that accepting retirement benefits renders it mutual and estops any objections.
Additionally, Odu’a Investment counter-claimed N3,814,794.75 as Mrs. Tunji-Ojo’s total indebtedness on the cooperative loan.
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Court’s decision
In delivering the verdict, Justice Dele Peters emphasized that a party cannot benefit from their own errors.
He said when an employer’s document has multiple interpretations, equity demands adopting the interpretation most protective and advantageous to the employee.
Justice Peters ruled that Clause 6.4 of the Handbook should be interpreted as allowing Odu’a Investment to activate the retirement clause only when Mrs. Tunji-Ojo reaches 45 years, neither before nor after.
Furthermore, he said Odu’a Investment failed to comply with the applicable rules in retiring her, and the compulsory retirement required approval from the Board, which lacked evidence.
The Court stressed that, without an economic downturn necessitating downsizing, Odu’a Investment must provide justifiable reasons for Mrs. Tunji-Ojo’s sudden compulsory retirement, aligning with international best practices and labor standards.
Consequently, the court declared Mrs. Yinka Tunji-Ojo’s compulsory retirement as unlawful and ordered the company to pay her the sum of N83million.