BREAKING NEWS, Business
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The Nigerian government and the Nigeria Employers’ Consultative Association disagree over the recent spate of retrenchment in the banking where four banks have sacked about 2000 in just one month due to bad economy. The government issues a directive to the banks to stop sacking failure of which their licenses will be withdrawn
| By Anayo Ezugwu | Jun 20, 2016 @ 01:00 GMT |
THE federal government and the Nigeria Employers’ Consultative Association, NECA, including some Nigerian banks are at loggerheads over the recent retrenchments of workers by the later. The government said the banks breached their terms of engagements by sacking workers without consulting the stakeholders and threatened to withdraw the licenses of recalcitrant banks.
Banks like First Bank Nigeria Limited, Diamond Bank Plc, Ecobank Plc and Skye Bank Plc sacked many of its workers in the last one month. But the federal government, on Tuesday, June 7, expressed shock that employers in the financial sector, especially banks were breaching its directives to stop further retrenchment, threatening to withdraw the operating license of any bank or telecommunications company that breached its directive to stop mass sack of workers.
Senator Chris Ngige, minister of labour and employment told journalists at the ongoing 105th session of the International Labour Congress, ILC, in Geneva, Switzerland, that government would sanction erring companies because it had a duty to protect jobs in this harsh economy.
“We will go a step further if they continue. We know what to do. After all, the banks have the licenses given by the government. We know what to do. They need to comply. They need to come to the negotiation table. We did (halted the spate of sack to hold a stakeholders meeting) that in the oil industry and we succeeded.
“Even if you are going to lay-off, there is a way to declare redundancy, there is a process. Section 20 of the Labour Act says it. You must call the unions and discuss with them. You don’t just treat them as slaves in their own country and you want us to keep quiet. We want them to maintain the status quo. As far as I am the minister of labour, I will protect the interest of workers; same to the telecommunication companies, they are also talking about compiling lists without discussing with anybody.”
Disagreeing, the Nigeria Employers’ Consultative Association said the federal government was not in a position to order banks not to disengage staff. It said the directive by Senator Ngige to banks to halt further sack of its workers was faulty. Olusegun Oshinowo, director general, NECA, said it was not in the place of Ngige or the federal government to issue such order. NECA, therefore, told banks, financial institutions and other employers of labour to ignore the directive.
Oshinowo said the country’s labour law did not empower Ngige to issue such a directive. He said the directive was only populist, but uninformed. He said, “The minister seems not to have shown understanding of the fundamentals of industrial relations and labour laws in Nigeria and thus has acted ultra vires. Employers have rights, which include the right to hire and fire, within the rules governing such employment contract and are employers’ prerogatives, which are not subject to ministerial directives.
“Where an employer has found it necessary to carry out retrenchment, it would respect the laws of the land and the laid down procedures for redundancy. Employers’ expectation from the minister of labour and employment is that he will work hand in hand with other government ministries in the establishment of the desired enabling environment to ensure business sustainability, competitiveness and job creation.
“The ministry of labour and employment is expected to respect the rights and interests of employers and workers alike on issues that relate to labour and industrial relations. For a long time, employers have been advocating that the ministry should be headed by a technocrat in order to avoid the kind of disposition being displayed by the minister, which tends towards populism and partisanship rather than professionalism. No employer would take pleasure in declaring redundant employees it had invested significant resources in developing over the years. Usually, redundancy exercise is foisted on employers on account of an unhealthy economy and the dynamics of the business, which often demands staff rationalisation.”
Weighing in the argument, the Senate on Wednesday, June 8, resolved to summon Ngige, Godwin Emefiele, governor of the Central Bank of Nigeria and heads of various commercial banks, on the current mass sacking in the nation’s financial sector. The decision was taken at the plenary following a point of order raised by Rafiu Ibrahim, committee chairman on Banking, Insurance and Other Financial Institutions, who noted that the statement made by Ngige to withdraw banking licenses should banks fail to reverse the mass sack, adding that such action could have a negative impact in the country. “We want to now the basis for such a directive and such a threat. We want to know what will happen if the threats are carried out bearing in mind that all the banks are either private companies, or quoted companies,” Ibrahim said.
Nonetheless, the recent trend of retrenchment of workers in the financial services sector on Monday, June 6, extended to Skye Bank Plc, which sent 175 of its employees into the labour market. The bank confirmed the development in a statement through which it explained that the affected workers failed the year 2015 appraisal exercise.
The statement explained that a combination of factors was taken into consideration in the annual exercise, which ranged from low productivity to disciplinary issues, adding that the affected employees were duly exited in line with the bank’s staff exit policy.
The statement read in part, “The staff disengagement exercise is coming a year after the bank’s successful integration with the erstwhile Mainstreet Bank, which it acquired in October 2014; the integration exercise described by analysts as a landmark in Nigeria’s banking industry has significantly improved Skye Bank’s ICT capacity and helped strengthen the bank’s service delivery.
“The bank extended its appreciation to the affected staff for serving the bank, describing them as members of the family who will always be accorded deserving respect in their future dealings with the bank.”
According to the statement, Skye Bank is adjudged by the Central Bank of Nigeria as one of the systemically important banks with over N1.3 trillion balance sheet and has more than 400 branches.
Similarly, Ecobank Nigeria also sacked more than 1,040 of its employees, while Diamond Bank Plc also retrenched more than 200 members of its workforce. Also, FBN Holdings, the parent company of First Bank of Nigeria Limited, recently said it would prune the number of its employees by 1,000.
With the directive from government, Nigerians are waiting to see if the banks will comply and recall the sacked workers before the stakeholders meeting in July.
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