“Resignation Does Not Require Employer’s Acceptance” — Court Voids Chan Medi Pharm’s Dismissal, Orders Payment Of Ex-Employee’s Entitlements

The Court, presided over by Hon. Justice Ibrahim Galadima, held that Igwe’s resignation took effect upon the expiration of the one-month notice he gave in April 2021, thereby bringing his employment relationship with the pharmaceutical company to an end.

Consequently, the Court ordered Chan Medi Pharm to pay Igwe ₦406,000 as gratuity, ₦712,000 in cooperative deductions and ₦500,000 as general damages.

The Court also directed the company to remit ₦316,000 into his pension account and ₦8,000 to the relevant tax authority.

From the facts of the case, Igwe stated that he submitted his resignation letter in April 2021 and gave the required one-month notice.

He maintained that upon the expiration of the notice period, he ceased to be an employee of Chan Medi Pharm.

According to him, the company subsequently issued a memo refusing to accept his resignation on the ground that he had not provided his personal account for investigation.

He contended that Chan Medi Pharm later disregarded his resignation and issued him a letter of dismissal.

Igwe further averred that the company’s refusal to pay his outstanding entitlements caused him financial hardship and emotional distress, prompting him to institute the action seeking, among other reliefs, the setting aside of his dismissal, payment of his outstanding entitlements, general damages, interest and costs.

In its defence, Chan Medi Pharm contended that Igwe was a person of interest in an ongoing audit and investigation into alleged irregularities in the company’s management and financial affairs.

The company maintained that its refusal to accept his resignation was justified because he was under investigation and that his resignation was viewed as an attempt to evade scrutiny.

Chan Medi Pharm further argued that Igwe remained its employee until his eventual dismissal because he was aware that his resignation had been rejected before the expiration of his notice period.

The company urged the Court to dismiss Igwe’s suit in its entirety, contending that its actions were justified by his alleged failure to cooperate with the audit and investigative processes and his alleged abscondment from duty.

Delivering judgment, Justice Galadima held that resignation is a voluntary relinquishment of employment and that, unless a contract of employment provides otherwise, it takes effect once the employee complies with the required notice period and does not require the employer’s acceptance to become effective.

The Court stated that there was no clause in the appointment or subsequent letters placed before it making Igwe’s resignation conditional upon Chan Medi Pharm’s acceptance or the conclusion of investigations.

The Court further held that a rejection letter unilaterally generated by an employer could not override a valid resignation duly issued in accordance with the terms of the employment contract.

Justice Galadima also held that the investigation into the alleged financial irregularities did not extinguish Igwe’s valid notice of resignation, as Chan Medi Pharm failed to establish any legal basis for suspending the effect of the resignation.

The Court held that once Igwe’s employment with Chan Medi Pharm ended in April 2021, there was no employment relationship left upon which the company could subsequently act by issuing the dismissal letter in June 2021.

Justice Galadima, however, held that Igwe failed to sufficiently prove his claims for salary differential and leave allowance, but established his entitlement to gratuity and cooperative deductions.

The Court further found that Igwe showed that his pension contributions had not been fully remitted and that tax deductions from his earnings had also not been remitted as required.

Justice Galadima held that issuing a dismissal letter after the employment relationship had already ended was a serious and injurious act capable of stigmatising Igwe and affecting his reputation and post-employment standing.