Landmark University loses, as court orders payment of N1.4m gratuity to its ex-lecturer

The National Industrial Court of Nigeria, sitting in Akure, the Ondo State capital, has ordered Landmark University, Omu-Aran, Kwara State, to pay Dr. Adebimpe Olukayode, a former staff of the university, the sum of N1,419,982.55 as accrued gratuity to him within the period of eight years, 2013 to 2021, when he was their employee.
The court also awarded N200,000 cost against Landmark University, to be paid in lump with the gratuity “within 30 days of the judgement or the said sums shall attract 10% interest per annum.”
The presiding judge, Justice K.D. Damulak, in his judgement dated February 13, 2025, said the issue for determination is whether the defendant, Landmark University, was justified in deducting from the claimant’s gratuity its contribution to his pension scheme.
Specifically, the judgment stated that the claimant, Dr. Adebimpe, in his General Form of Complaint filed on 21st February, 2022, sought the following reliefs against the defendant, Landmark University, namely:
. An order of court mandating the Defendant to pay with immediate effect the sum of (N1,789,003.92) One Million, Seven Hundred and Eighty-Nine Thousand, Three Naira, Ninety-Two Kobo being gratuity entitled to by the Claimant;
. An order mandating the Defendant to pay 10% interest per annum of the Claimant’s gratuity (N1, 789, 003.92) from the 30th day of September, 2021 when payment became due and from the date of Judgment till the entire gratuity is finally liquidated, and
. An order mandating the Defendant to pay the sum of N500,000.00 as the cost of this suit.
Quoting an earlier decision of the Industrial Court, delivered by Oyewumi J. (now JCA) in the case of Mr Haruna Ishola Salau v. Sterling Bank Plc, dated 4th October 2023, the judge said, “This Court does not share the belief that an employer has a right to take away an accrued right of an employee under the guise of revising the Conditions of service … The Defendant cannot take away an already accruing right of the Claimant as calculated in the 2006 Conditions of service in the manner it did.”
Justice Damulak said, “It is a principle of labour law that even though an employee can waive his right under the contract, the waiver must not be one imposed by the employer. The employer no doubt has a right to alter the conditions of service without the consent of an employee but then such unilateral alterations in my view is only limited to changes within its managerial prerogative due to operational concerns and not extended to basic conditions of service like this right to gratuity after 5 years of service with the Defendant.”
The judge affirmed, “I am in total agreement with the above decision of the learned Jurist and adopt it as mine. This is more so because even before the introduction of the 2019 Handbook, the defendant was paying contributory Pension into the claimant’s pension scheme by reason of Chapter 14.5 of exhibit AO4 and yet the claimant was still entitled to gratuity by reason of chapter 14.2 and 14.3 of exhibit AO4. Deducting the said pension contribution from the claimant’s earned gratuity means the defendant did not pay make pensions contribution for the claimant.
“Equity dictates that the defendant cannot use the 2019 Handbook to negatively affect the accrued entitlement/gratuity of the claimant which has accrued before the coming into effect of the 2019 Handbook while at the same time effectively excluding the period from when the 2019 Handbook came into effect in calculating the claimant’s accrued gratuity.”
He also said: “The 2019 Handbook cannot have retrospective effect. Rights that have accrued before the coming into effect of the 2019 Handbook cannot be negatively affected by the 2019 Handbook to the disadvantage of the employee claimant.”
According to the judgement, the claimant “was employed in 2013 and he resigned in 2021, a period of 8 years. The new Handbook came into effect in September 2020. The claimant calculated 8 years for which he served as the number of years to be used in calculating his gratuity. This cannot be, since the new Hand Book came into effect in September, 2020, so the period from September, 2020 to September, 2021 cannot be reckoned with for the purpose of calculating the claimant’s gratuity.”
The judgement stated that when the defendant, in reference to calculation of the gratuity benefit of the claimant, said that the terminal cut off point of the claimant is 31/8/2020, it simply and correctly means that the claimant’s terminal benefits were to be calculated based on the 2011 Handbook and not the 2019 Handbook which excludes the payment of gratuity but was not in operation as at 31st August, 2020.
“This in effect means that claimant had already earned his gratuity under exhibit AO4 before exhibit TA1 became operative given the number of years he had spent in the service of the defendant. Can exhibit TA1 now come into force in September 2020 to take away such already earned right? I think not. It does not appear equitable or just,” the judgement added.