The National Industrial Court in Lagos has ruled that Fidelity Bank Plc must pay more than N162 million in retirement benefits that were withheld from several former employees.
The court found that the bank wrongfully held back payments owed to longtime staff members who had worked through third-party employment arrangements.
A group of eleven former employees brought the case forward through their lawyer, Chief Mike Ozekhome, SAN. The group includes Ann Nwabulu, Chidinma Fred Oka, Doris Alfred-Okhilua, Dayo Johnson-Olayemi, Julius Ubah, Obiageli Mbadiwe, Obasi Esobe, Sophia Milton, Yemisi Femifalade, Abiamuwe Sylvester, and Nnenna Ekwueme.
They asked the court to declare that the bank broke their employment contracts and violated labor laws by not paying their retirement benefits. They also challenged the bank’s attempt to use a new retirement policy retroactively to avoid paying their entitlements, and requested immediate payment of the money owed to them.
Justice R.H. Gwandu, who delivered the judgment, found that the former employees had proven their case, including the tenth claimant who joined Fidelity Bank after it merged with FSB International Bank and Manny Bank.
The court looked at two main questions: whether it could hear the tenth claimant’s case, and whether the former employees had proven they deserved the retirement benefits they claimed.
Justice Gwandu decided the court could hear the tenth claimant’s case. While Fidelity Bank claimed they never directly employed him, saying he was only seconded to them, the court found evidence that he had worked with FSB under Direct Resources Limited and then continued with Fidelity Bank for 11 years after the merger until retiring in 2016.
The judge pointed to long service awards and recognition letters from Fidelity Bank as proof of his status as a longtime employee, saying “It would be unfair and unjust to claim no employment relationship existed. The bank cannot use technicalities to dodge its responsibilities when the facts are clear and undisputed.”
On the main issue, the court sided with the former employees, who worked for Fidelity Bank through a third-party company called Fidelity Union Securities.
Justice Gwandu criticized banks using third-party companies to avoid their responsibilities to workers, noting that Fidelity Bank had acknowledged the employees’ years of service through official letters and certificates.
“This court has always disapproved of using third-party companies to avoid responsibility under the excuse of contract relationships,” the court stated.
The court also dismissed Fidelity Bank’s argument that the former employees hadn’t completed the 15 years of continuous service required by its retirement policy.
