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INTRODUCTION-MEANING AND SCOPE, FORMATION, HISTORICAL BACKGROUND AND BASIS OF LIABILITY.
1.1 Meaning and Scope of Contract of Employment
The contract of employment is a specie of contract, and is Therefore governed by general principles of the law of contract, consensusad item, Being a kind of simple contract, contract of employment must also satisfy the elements of a valid contract. The vitiating factors are also applicable to it. What distinguishes a contract of employment from a simple contract, which chitty defines as a promise or a set of promises which the law will enforce1, is the degree of control that one party has over the other party2. Also, a contract of employment relates to a relationship that exists between two or more persons for the performance of services, while one person is employed by the other. Where as, a contract relates to a relationship that exist between two or more persons in any transaction, generally.
Traditional statements of what constitute a contract of employment, place most emphasis on the power of the employer to control the work of the employee in contrast to a contract with an independent contractor.In Chadwick v. pioneer private telephone Ltd, contract of employment was defined thus: contract of services implies an obligation to serve and it comprises some degree of control by the master”3. It must howeverbe noted that there is no comprehensive definition, only conflicting criteria’s. A contract of employment can be defined as a contract entered in to by two parties whereby one party submits himself to the service of the other for some considerations in most casess salary and wages. An attempt has, however been made in the sphere of labourLegislations in Nigeria4 at defining a contract of employment as;
’’Any agreement whether oral or written, express or implied, whereby one person agrees to employ another as a worker and that other person agrees to serve the employer as a worker.”
It is a contract of service and not for service, what differentiates them is the fact that in a contract of service, a man (employee), places his labor at the disposal of another, resulting in a relationship between the to parties. Where as, a contract for services involve a situation where a man who operates an independent business agrees to do labor or carry out a task or tasks for the person of another. In past times, the contract of employment was known as and called a relationship of ‘’ master and servant”.
Since employment relationship strictly represents subordination of an individual as a worker to an employer, which relationship could be described as a dependent labor relationship, Mr. Y’s house keeper, gate keeper, driver or chauffeur is his employee, that a laundry man or a t-axi driver is an independent contractor5.
Thus, for a contract of employment to be distinguished from a contract for service, the parties involved must avail themselves of the statutory rights under it. That is, it must be shown that a relationship of employer and employee or master and servant exists between them. Thus, there must be terms agreed by both parties for this will be the sole principle which will guide their acts and conducts during the subsistence of the employment. As held by the court in SMITH V. GENERAL MOTOR CAB. CO6, where the claim for the existence of such relationship between the parties fails.
As must have been noted, a contract of service involves two separate legal categories of persons namely – an Employer, master, hirer, or recruiter, and an Employee. WHO IS AN EMPLOYER ?: Although this has no précise meaning in law;
’’An employer is any person who has entered in to contract of employment to employ any other person as a worker her for himself or for the services of any other person and includes the agents, manager, or factor of that first mentioned person and the personal representatives of a deceased employer.”7
An employer can also be defined as; ’’The entrepreneur who engages a worker under a dependent labor relationship and has control over that worker to the extent that such worker could be referred to as an employee’’. Also, an employer is ’’Any person who employs or engages labour or the service of another person under contract of service’’.Theemployer could be an individual, a partner, a corporate body or even a state (the Government).8
WHO IS AN EMPLOYEE?
Any person who has entered in to or works under a contract with an employer whether the contract is for manual labor or clerical work or express or implied or oral or written, and whether it is a contract of service or a contract personally to execute any work or labor but does not include…………… persons exercising administrative, executive, technical or professional functions as public officer or otherwise.”9
To identify an employer or servant then, the essential question is ’’ was his contract a contract of service within the meaning which an ordinary person would give to the word?”. In CASSIDY v. MINISTER OF HEALTH10Bomerell,l.jgave the view that, if the answer is YES, then such a person will be regarded as an employee. In ADEYEMO v. OYO STATE PUBLIC SERVICE COMMISION,11 the plaintiff who was a deputy accountant Generalloyo state public service was held to be a servant or employee. Employee and servant have been used interchangeably by authors also, various Nigerian statutes have defined who a servant is by using words like workers, employee or workman.
1.2 Formation of Contract of Employment
The existence of binding relationship between the employer and the employee arises out of contract, as essential elements for the formation of a contract of employment or service between an employer and employee upon which their rights and obligations depends are generally same as conditions in ordinary or simple contact. This legal relationship therefore presupposes the voluntary consent of the parties to its creation expressed through the process of hiring within limitation imposed only by the general law of contract or statutory regulation. The terms are often not negotiable by the individual employee except in some cases where remuneration is negotiable, depending on the professional skills required by the employer. As such, the rights and dutiesof the master and servant are essentially the products of free bargaining between the parties, as they have liberty to decide the terms and conditions of service.
Beside the element of voluntariness, there is also the presumption of equality between the parties but professor Odumosu has described this presumption of equality between the parties as a ’’Fiction’’.12 Also, AdeogunA.A commented on the presumption of equality and voluntariness of bargaining power between the master and the servant, as he noted that, ’’… the so-called bargaining power of the individual worker is of little importance in practice……”13
The basic conceptual frame work for the individual employment relationship is provided by contract, and as such, the employment relationship created must of necessity satisfy all the essential features of a valid contract. There must be offer, acceptance, requisite capacity of parties, consideration, intention to give the agreement legal efficacy and no element vitiate the contract. With regard to capacity, the parties must have requisite legal capacity to enter the employment relationship, Generally, the capacity of infants, women, and persons of unsound mind are limited in some ways.
1. Chitty, general principles of contracts (24thED) london: sweet&Maxwell,1977
2. R.K salman, A critical analysis of rights of employer& employee under the Nigeria contract of employment
3. (1914) ALL E.R. 522 at 535
4. Nigerian Labour Act, No 1974, Section 91 (1)
5. ACB ltd v. APUGO (1995) 6 NWLR (pt.399) 65
6. (1911) A.C. 188
7. Labor Act, cap 14, LFN, 2004, Section 91.
8. A critical Analysis of rights of employers & employees under contract of employment
9. Labor Acts, cap 14, LFN 2004, section 91
10. (1951) ALL E.R 574
11. (1978) 2 LRN 268
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