Redundancy Employers Cryptic Strategy for Organizational Downsizing and Trade Union Response

Abstract

Abstract

Redundancies are legal in Nigeria as it is recognized by the Nigerian Labour Act and the Nigerian Courts. The Act defines redundancy as perpetual elimination of jobs due to excessive workforce.  However, employers and businesses declare redundancy not just because of excess manpower as stipulated by law but for several other unrelated reasons. Are employers required by law to prove that it is a role that is being made redundant rather than the employee? This paper investigated if redundancies have become a cryptic strategy for employers to reduce their workforce and what are the responses of the trade unions. The study carried out an archival study using secondary sources of information which were retrieved from print and online literature. Several companies across banking, telecommunications, logistics, manufacturing, oil and gas and the public service sector which disengaged workers citing redundancy of roles and the responses of trade unions were analyzed. Human Capital Theory and Psychological Contract Theory were utilized as the theoretical framework and findings revealed that most employers in Nigeria do not completely adhere to procedures and requirements for redundancy as stipulated in the Labour Act. Trade unions’ responses ranges from picketing, street protest, strike actions and institution of legal actions against employers and organizations. Transparency, clear communication, objectivity, stakeholders engagement, clear guidelines for calculation and prompt payment of redundancy package, clear definition of redundancy disengagements, and amendment to the Nigerian labour law to accommodate the different type of workers in Nigeria are the recommendations of the study.

Key Words: Redundancy, courts, trade union, labour, employer, employee, organization, disengagement.