THEODOSIA ANTWI V. EPROCESS INTERNATIONAL

JUDGMENT

OWUSU, J.

By her Writ of Summons and amended Statement of Claim, the Plaintiff claims the following against the Defendant: 

a. A declaration that the purported redundancy exercise amounts to unlawful termination of Plaintiff’s appointment. b. A further declaration that the redundancy exercise violates the Labour Act 2003, Act 651 and is therefore unlawful. c. An order for Defendant to pay Plaintiff her monthly salary from the 1st day of January 2015 till date of judgment. d. An order for the Defendant to pay Plaintiff three month’s salary in lieu of notice for the redundancy. e. An order for Defendant to pay to Plaintiff Gratuity Pay at the rate of twelve (12) months of Plaintiff’s gross salary for each complete year worked. f. An order directed at Defendant to pay in respect of the redundancy or severance pay to Plaintiff a Severance Pay at the rate of twelve (12) months Gross salary for every year work. g. An order for Defendant to absolve Plaintiff’s loans. h. An order for Defendant to pay Plaintiff’s bonus for the year worked for and ended 2014. i. General damages for discrimination, unlawful termination and unlawful redundancy. j. Costs including Solicitors fees. k. Further or other reliefs that this Court may deem fit.

SUMMARY OF CASE THE CASE OF THE PLAINTIFF 

Plaintiff averred that she was an employee of the Defendant. According to her she commenced work on the 7th day of November 2011 as a MIS officer and offered flawless services to the Defendant until the 8th of December 2014 when she was called and informed by her boss that her position had been optimized or made redundant due to a restructuring exercise and should report the following day for her letter and also to hand over. It is her case that her exit from the Defendant Company is a result of victimization and that the failure of the Defendant to give her the requisite notice and to negotiate with her the package due her is in breach of the Labour Act, 2003, [Act 651]. 

THE CASE OF THE DEFENDANT 

The Defendant’s case is that it carried out a redundancy exercise and the employment of those affected was terminated with immediate effect. They were paid in lieu of notice. The Defendant maintains that the exercise was carried out without any malice to single out and to terminate the Plaintiff’s employment. It is their case that the statutory requirement for notice as provided for under the Labour Act was complied with but attempts at negotiating the package was made impossible by the Plaintiff’s entrenched position on what she deemed she was entitled to. 

The following issues were set down as the issues for the trial: 

a. Whether or not the purported redundancy exercise by the Defendant amounts to unlawful termination of the Plaintiff’s employment.b. Whether or not the purported redundancy exercise by the Defendant violates the Labour Act 2003, Act 651. c. Whether or not the Plaintiff is entitled to her reliefs. d. Any other issues arising from the pleadings. 

ANALYSIS OF THE ISSUES 

I will proceed to address issues (a) and (b) together. 

a. Whether or not the purported redundancy exercise by the Defendant amounts to unlawful termination of the Plaintiff’s employment. b. Whether or not the purported redundancy exercise by the Defendant violates the Labour Act 2003, Act 651. 

An employer, just like the employee could terminate the contract of employment “at any time”. In the case of ASHUN v. ACCRA BREWERY LTD [2009] SCGLR 81 cited by counsel for the Defendant, the court held that:

“a contract of employment is not necessarily a contract till retirement age. In other words, a contract of employment, though it may be for an indefinite period, does not mean life employment.” 

In the case of CHATLANI v. HAROUTUNIAN [1974] 2 GLR 263, the court held that the employer, like the employee, could indeed terminate the contract of employment at any time provided only that the required notice is given. I again refer to the case of KOBEAH AND OTHERS v. TEMA OIL REFINERY; AKOMEA-BOATENG v. TEMA OIL REFINERY (CONSOLIDATED) 2003-2004 SCGLR 1033 @ 1039. 

To prevent an abuse of an employer terminating the employment of an employee at will, the law makes provision in sections 62 and 63 on what is fair and unfair termination. 

“62. Fair termination A termination of a worker’s employment is fair if the contract of employment is terminated by the employer on any of the following grounds: (a) that the worker is incompetent or lacks the qualification in relation to the work for which the worker is employed; (b) the proven misconduct of the worker; (c) redundancy under section 65; (Emphasis mine)(d) due to legal restrictions imposed on the worker prohibiting the worker from performing the work for which the worker is employed. 

This suggests that termination of the employment of an employer due to redundancy is fair and legal and cannot be unlawful. 

The Labour Act does not define what a redundancy is, properly so called. The Cambridge Advanced Learner’s Dictionary defines ‘redundant’ thus: ‘to lose your job because your employer no longer needs you’. It is mainly on the ground that the employer has or intends to cease carrying on business for which the employee was employed or to cease doing so in the place where the employee was employed or the requirements of that business for employees to do work of that kind have diminished or are expected to do so either completely or in the place where the employee was employed. I refer to page 354 of the book LABOUR LAW by James Odartey Mills. 

Although Section 62 of the Labour Act provides that termination due to a redundancy exercise is considered fair termination certain steps must be taken by the employer or organization when it contemplates declaring a redundancy. Section 65 of the Labour Act outlines these steps. It provides: 

“65 Redundancy (1) When an employee contemplates the introduction of major changes in production, programme, organization, structure or technology of an undertaking that are likely to entail terminations of employment of workers in the undertaking, the employer shall (a) provide in writing to the Chief Labour Officer and the trade union concerned, not later than three months before the contemplated changes, the relevant information including the reasons for the termination, the number and categories of workers likely to be affected and the period within which the termination is to be carried out; and (b) consult the trade union concerned on measures to be taken to avert or minimize the termination as well as measures to mitigate the adverse effects of the terminations on the workers concerned, such as finding alternative employment.(2) Without prejudice to subsection(1), where an undertaking is closed down or under-goes an arrangement or amalgamation and the close down, arrangement or amalgamation causes (a) severance of the legal relationship of worker and employer as it existed immediately before the close down, arrangement, or amalgamation, and (b) as a result of and in addition to the severance that worker becomes unemployed or suffers diminution in the terms and conditions of employment, the worker is entitled to be paid by the undertaking at which that worker was immediately employed prior to the close down, arrangement or amalgamation, compensation, in this section referred to as “redundancy pay”.(3) In determining whether a worker has suffered a diminution in the terms and conditions of employment, account shall be taken of the past services and accumulated benefits, of the worker in respect of the employment with the undertaking before the changes were carried out. (4) The amount of redundancy pay and the terms and conditions of payment are matters which are subject to negotiation between the employer or a representative of the employer on the one hand and the worker or the trade union concerned on the other.” 

Where these mandatory steps are not followed, the purported redundancy exercise will not be in accordance with the law. When did Defendant contemplate the redundancy exercise? In Exhibit 8, the planned date for the redundancy was 15th October 2014. The said letter to the Acting Chief Labour Officer is dated 19th of September 2014. This falls short of the statutory mandatory three (3) months’ notice as required by law. This led to Exhibit 11, a letter from the Acting Chief Labour Officer dated 22nd October 2014 indicating that Defendant had flouted Section 65 (1) (a) of the Labour Act. Exhibit 9 which pushed the scheduled date for the commencement of the exercise to 30th November is dated 19th November 2014. That again falls short of the statutory mandatory three (3) months’ notice required from the employer as noted in Exhibits 11 and 12, the letters from the Labour Department. In fact the Defendant was aware it had flouted the statutory requirement as regards redundancy. Under cross examination, this was an answer given by DWI (Mr. Emmanuel Kotey) in the record of proceedings of the 22nd of January, 2016: 

Q: So you would agree with me that from Exhibit 11 Defendant was informed that they had flouted section 65 of the Labour Act? A: That is correct my Lord. However we responded to the Labour Office to explain why we had not flouted the relevant sections of the Act. Q: I presumed you responded by Exhibit 9. A: My lord Exhibits 9 and 10 Q: I am suggesting to you that by Exhibits 9 and 10 you assured the Labour Office that you will be complying with the Labour Act. A: Yes my Lord. 

At page 16 of his written address to the court, counsel for the Defendant stated: 

“Assuming without admitting that the Defendant flouted the provisions of section 65 of the Labour Act by its 19th September 2014 letter which had indicated earlier that the effective date of the redundancy was supposed to be 15th October 2014, this was corrected/revised and the effective date of the redundancy was actually, the 31st of December, 2014, which satisfied the three month required.” 

I disagree with counsel for the Defendant since Exhibit 9 dated 19th November 2014 states

“As a result of the extensive consultations, the scheduled date for the commencement of the exercise has also been rescheduled to 30th November 2014” 

The Labour Office was informed of the rescheduled date for the exercise. If the Defendant further rescheduled the exercise to 30th November, 2014 there is no evidence on record to show that the Labour Office was made aware of this new date. Defendant thus cannot be heard to say that the required (3) months’ notice was given.

It is Plaintiff’s contention that Defendant having failed to comply with Section 65 of the Labour Act has breached Section 63(4) (a) and (b) of the Act thereby making the termination unfair and unlawful. Unlawful termination as a cause of action is neither a common law principle nor provided for in the Labour Act. However, since Defendant failed to comply with the mandatory provisions in Section 65 of the Labour Act the court may be right in holding that the redundancy was not conducted in accordance with law thereby making it illegal and wrongful. The Plaintiff is thus entitled to damages or compensation. 

It is not a disputed fact that at the time of the redundancy exercise, the employees of the Defendant were not unionized. Is the Defendant obligated to give three (3) months’ written notice notifying the Plaintiff of the redundancy exercise? According to the Plaintiff she only got to know about the redundancy on 8th December 2014.

It is the Plaintiff’s case that she was entitled to be given three (3) months’ notice period. That in the absence of a trade union, the notice required in Section 65 of the Labour Act must go to her. The Defendant disagrees with the Plaintiff’s view that she is entitled to a three (3) months’ notice period and maintains that the notice was supposed to be given to the Chief Labour Officer. At page 17 of his address to the court, counsel for the Plaintiff suggested that the wording in Exhibits 11 and 12 clearly required that the notice be extended to the representatives of the employees or the employees concerned. I tend to side with the Defendant on this point and do not think that Exhibits 11 and 12 suggest that the three (3) months’ notice be extended to the employees and they be given three (3) months’ notice of the contemplated redundancy. 

A redundancy exercise invariably leads to termination of appointments and an employer wishing to terminate the contract of employment due to a redundancy need not inform the employee before the redundancy exercise, just as is the case for unilateral termination of appointments provided the specific periods of notice to be given to the other party is given; or the periods of notice are paid for where the party terminating prefers not to give any notice and this payment can be enforced. 

Where there is no express notice period in the contract of employment, Section 17 of the Act provides that in the case of a contract of three years or more, the employer may terminate the contract of employment at any time by giving to the employee one (1) months’ notice or one (1) months’ pay in lieu of notice.

In Exhibit A, which is the Plaintiff’s employment contract, her employment can be terminated by either party giving one (1) months’ notice. Again, the employer can terminate the contract without giving the required notice provided the employer pays to the employee a sum equal to the amount of remuneration which would have accrued to the employee during the time of the notice. This is what the Defendant did and applied the contractual provision of the one (1) months’ notice. The Plaintiff is not entitled to three (3) months’ salary in lieu of notice. 

However since Defendant failed to give the three (3) months’ notice to the Labour Office I declare that that the purported redundancy exercise amounts to unlawful termination of Plaintiff’s appointment since it was not done in accordance with Section 65 of the Labour Act. Again I further declare that the redundancy exercise violates the Labour Act 2003, Act 65. 

I shall now discuss issue (c)

c. Whether or not the Plaintiff is entitled to her reliefs. 

∙ As already established earlier, I hereby declare that the purported redundancy exercise amounts to unlawful termination of Plaintiff’s appointment. 

∙ Again I hereby declare that the redundancy exercise violates the Labour Act 2003, Act 651 and is therefore unlawful. 

∙ The Plaintiff prays that her monthly salary from the 1st day of January 2015 till date of judgment is paid by the Defendant. The Plaintiff was rendered redundant by Exhibit 2. The Plaintiff’s employment is not subsisting. She is no more in the employment of the Defendant. Accordingly she is not entitled to her relief c and same is dismissed. 

∙ In respect of an order for the Defendant to pay Plaintiff three month’s salary in lieu of notice for the redundancy, this matter has already been addressed. The Plaintiff is not entitled to the three (3) months’ notice required in Section 65 of the Labour Act as such she cannot be paid three (3) months’ salary in lieu of the said notice. 

∙ Plaintiff is again making a claim that Defendant pays to her Gratuity Pay at the rate of twelve (12) months of Plaintiff’s gross salary for each complete year worked. Where an employee’s employment is terminated he is entitled to receive all his terminal benefits and privileges. In Exhibit C, it states that Plaintiff will be paid Gratuity Pay at the rate of one (1) month of her basic salary for each complete year worked, subject to a maximum of twelve (12) months 

Defendant is offering a range with respect to gratuity pay as per the wording in Exhibit C. Gratuity Pay is received from an employer in gratitude for the services offered by an employee in the company. Considering the number of years worked, the court hereby orders that Plaintiff be paid Gratuity pay at the rate of two (2) months of Plaintiff’s gross salary for each complete year worked. 

∙ Plaintiff is also praying for an order directed at Defendant to pay in respect of the redundancy or severance pay to Plaintiff a Severance Pay at the rate of twelve (12) months gross salary for every year worked. According to Plaintiff this severance or redundancy pay was taxed. Yet again Defendant is offering a range, subject to a minimum of three (3) months and a maximum of twelve (12) months. The Defendant is ordered to pay three (3) months of Plaintiff’s gross pay for every year worked, exempt from tax. This is because under Section 4 (2) (b) (viii) of the Income Tax Act, 2015, Act 896, redundancy pay is exempt from tax

∙ Plaintiff is claiming an order for Defendant to absolve her loans. The termination of Plaintiff’s agreement should not absolve her from her obligations to Defendant under the loan agreements. This claim is dismissed 

∙ Plaintiff is claiming an order for Defendant to pay her bonus for the year worked for and ended 2014. This is not supported by any evidence. Accordingly same is dismissed. 



∙ She is again claiming general damages for discrimination, unlawful termination and unlawful redundancy. The Supreme Court in the case of KOBI v. GHANA MANGANESE CO. LTD [2007-2008] SCGLR 771 @ 772 held in holding 2: 

“In assessing damages for wrongful dismissal, the court must have regard to all the circumstances of the case considered as fair and reasonable……; and bearing in mind that judicial discretion should not be out of joint with the general trend on the matter and the fact that the award of damages in these matters has ranged between two years and one year……”

The court hereby awards the Plaintiff damages based on twelve (12) months’ salary at the time of her termination. 

I award costs of one thousand Ghana Cedis (GH₵1,000.00) in favour of the Plaintiff. 

(SGD) 

JUSTICE LAURENDA OWUSU  

JUSTICE OF THE HIGH COURT

COUNSEL

KOFI SOMUAH FOR THE PLAINTIFF SHADRACK

ARHIN FOR THE DEFENDANT