Ecobank logo, headquarters
By Victory Oghene
The National Industrial Court, Lagos Division has ordered Ecobank Nigeria Limited to pay the sum of N1, 086,611,589.11 to 1,742 ex-staff of Oceanic Bank, who were denied their legitimate entitlements by the banks.
Honourable Justice R. A Gwandu gave the order while delivering judgement in Suit Number NIC/LA /231/2012 filed by 1,742 ex- employees of defunct Oceanic Bank which merged with Ecobank Limited sometime in 2012.
In the Representative Action suit filed by Mr. Nwabu Okoye, Counsel to Mr. Babajide Bayode, Yemisi Adesote, Adeboyejo Oladimeji, Seun Aina, Yusuf Kadiri, Segun Alasan, Adetayo Familugba and Lolade Olaribigbe who sued for themselves and as representatives of 1,733 other ex-employees of Oceanic Bank now Ecobank Nigeria Limited, the plaintiffs sought for the following orders from the National Industrial Court :
An order directing Ecobank Nigeria Limited to pay the outstanding sum of N1,146,470,393,.62 being the sum total of their savings in the Staff Savings Investment Trust Fund (SSITF) scheme contributed by 1742 ex- employees of Oceanic Bank made up of those transferred to Ecobank upon merger of the two banks through the merger of February 15, 2012 and those whose employment were determined before or upon the said merger which remain unpaid till date.
The claimants in their statement of claim, said the amount outstanding as their contributions to the SSITF scheme which the defendant ( Ecobank) has refused to pay till date stands at N926,901,065,.60. Claimants also asked the court for an order directing Ecobank to pay the sum of N159,710,523.51 being the total sum due as gratuities to 48 of the claimants and another sum of N59, 858, 804.51 being the short payments of severance or redundancy paid by the defendant to 74 of them.
The court was further asked to grant an order directing Ecobank to pay 22 per cent interest per annum on the aforesaid sums of money being claimed from February 15, 2012 until judgement and thereafter at the rate of 12 per cent per annum until the liquidation of judgement sum.
However, Ecobank through its lawyer, S.C Arubike filed a statement of defence to the suit as well as counter- claim.
Ecobank in its counter- claim demanded for the sum of N967,529,765.38 being the excess of severance and or redundancy benefits paid to the ex- staff of Oceanic Bank, that is, the claimants at 24 per cent interest from October 30, 2014 until any judgement is delivered in its favour and interest of 10 per cent until the judgement sum is fully liquidated.
The bank also counter- claim for the sum of N225,724,076,.78 being the excess gratuities and entitlements paid to the representative members by Ecobank another sum of N1,541,491,955.03 being the sum outstanding and payable as at October 30, 2014 on credit facility granted to the representative members of the ex-staff.
The defendant further counter- claim in the sum of N41,640,000,000 being the amount due and outstanding as at December 31, 2010 on the Term Loan of N25,054,481,701.00 granted by Oceanic Bank (now Ecobank) to the former employees through the Board of Trustee of the Trust Fund which facility was accepted and fully utilised by the claimants for the purchase of shares of blue-chip companies and which sum the ex- staff (claimants) have failed, neglected or refused to repay till date despite repeated demands.
The summary of the claimants’ case according to the court was that prior to the merger of Oceanic Bank and Ecobank on December 30, 2011, there was in existence in Oceanic Bank the SSITF introduced by Oceanic Bank in 2004 to encourage its staff to save part of their earnings towards further financial commitments and assist staff in planning for their retirement.
It was further stated that the initial minimum contribution of each employee to the SSITF scheme was N6000 per month which was in August 2005 increased to a minimum of N14,000 per month .
Subsequently in 2008 the level of contributions to the staff fund was further reviewed upward by the bank and the review was based on the level of the staff involved, ranging from N20,000 to N50,000.
It was also stated that sometime in May 2010, Oceanic Bank discontinued deduction of the SSITF from its employees’ monthly salaries while every staff whose appointments were terminated or resigned from the bank were duly paid their SSITF.
The claimants further said that by a letter of February 13, 2012 , Ecobank advised a total number of 788 employees of Oceanic Bank whose employment has been transferred to the bank (Ecobank) consequent upon the merger, that effective from Wednesday February 15, 2012 such employees’ contract of employments with Ecobank has been terminated.
Claimants stated that 697 of those whose employment were terminated are among the 788. These 697 according to the plaintiffs have unpaid claims, including non-payment of their SSITF contributions among others.
It was also contended by the claimants that the calculations and payments of final entitlement to 706 out of the 788 employees whose employment was determined as at February 15, 2012 or resigned as an option under the merger with Ecobank was flagrantly violated.
After analysing the facts of the case as submitted by Counsel to both parties, Mr. Nwabu . A. Okoye for claimants and S.C. Arubike for Ecobank, Justice R.A Gwandu dismissed the defence and counter- claim of Ecobank on the ground that the bank failed to put credible evidence before the court to support its counterclaim.
Justice Gwandu in his judgement held that upon the consummation of the merger, Ecobank has fully acquired all the assets and liabilities of Oceanic Bank and cannot repudiate or push some of the liabilities on its employees, moreso when it was the bank that was in control of the SSITF scheme.
The trial judge further held that Ecobank cannot deny that there were contributions to the SSITF or show evidence that the claimants were paid the sum they claim.” I therefore hold that the claimants have proved their case and are entitled to the payment of the sum of N926,901,065.60 being the sum total in the account of the Staff Savings Investment Trust Fund being contributions of 1742 ex- employees of Oceanic Bank made up of those transferred to Ecobank upon the merger and whose contract of employment were determined on February 15, 2012 and those whose employment otherwise were determined before or upon the merger.
On the issue of unpaid gratuities, Justice Gwandu said “I therefore hold that the defendant is liable to the claimants in the sum of N159,710,523.51 being the total sum due on the basis of years of service of the employees.
The judge, however, refused the plaintiffs’ claim of N59,858,804.51 being the total sum of short payment of severance or redundancy package paid by Ecobank to 74 of the claimants.
Justice Gwandu said it would be unfair for the court to hold Ecobank responsible for any lapses that may have occurred under the agreement brokered by ASSBIFI since some of the ex- staff benefitted under the agreement and are happy under the same agreement moreso the intervention of ASSBIFI had the consent of the ex-staff.
Justice Gwandu, granted 10 per cent interest on the judgement sum from 30 days after the judgement was delivered till it is fully liquidated.
