NATIONAL UNION OF HOTELS AND PERSONAL SERVICES WORKERS AND FEDERAL PALACE HOTELS LIMITED (NATIONAL INDUSTRIAL COURT) HON. JUSTICE (CHIEF) P.A. ATILADE - PRESIDENT M.A. BORISADE, ESQ. - MEMBER B.N. OBUA, ESQ - MEMBER SUIT NO: - NIC/12/88 DATE OF JUDGMENT - THURSDAY, 3RD AUGUST, 1989. LABOUR LAW - Termination of employment - Period of notice therefor - Right of employer to services of employee during the period - Right of employee to agreed wages during the same period - Whether both employer and employee can waive their respective rights - Section 11(6), Labour Decree, 1974 considered. ISSUE: What are proper interpretation of Clause 2 captioned “Resignation and Termination of Appointment” the Collective Agreement entered into by both parties on 26th July, 1975? FACT: The Applicant applied to the National Industrial Court for the interpretation of Clause 2 captioned “Resignation and Termination of Appointment” of the Collective Agreement entered into by both parties on 26th July, 1975. The Clause 2 of the Collective Agreement states, inter alia as follows: Appointment may be terminated by either side with exception of summary dismissal by notice or payment in lieu of notice as follows: 1. Established staff (confirmed) (a) 1 - 5 years continuous service - 2 months. (b) Over 5 years continuous service - 3 months. 2. Casual workers a) One day in any case in which the period of service is less than one month. b) One week for casual workers of more than one month's service whose wages is calculated daily. (c) TWO weeks in any case in which the period of service is for one month or a longer period than one month. 3. Unestablished staff (unconfirmed) In all cases, the termination of appointment either by giving the required period notice or payment in lieu, will be given. A dispute as to the correct interpretation of the above provisions of the collective agreement arose when on 4th May, 1988, a staff who had put in eleven years service gave three months notice of resignation. The Respondent accepted the resignation with immediate effect and proceeded to waive the three months' notice given by the staff, but did not pay for the three months per; notice. Consequently, the Applicant made the instant application. HELD: (Granting the Applicant's claim): On Whether employer can unilaterally waive worker's right to remuneration during period of notice of termination of employment - In accordance with general contractual principles, an employer has a right to the services of: an employee during the period of notice, while the employee has a right to his agreed wages during the same period. It is, however, open to either party at any time during the period of notice to terminate the contract by agreement. This common law principle has been given statutory recognition by the Labour Decree, 1974, section 11 (6), which states that noting in the section shall prevent either party to a contract from waiving his right to notice on any occasion, or from accepting a payment in lieu of notice. This means that an employer can decide to waive his right to the services of the employee during the notice period by payment in lieu of the employee's right to working out his notice period. In the instate while the Respondent can exercise its right of waiver under section 11(6) of the Labour Decree, 1974 in respect of the services of Mr. S.O. Shobiye, the Respondent cannot unilaterally waive Mr. Shobiye's right to his remuneration during the period of notice. The court accordingly ruled that Mr. Shobiye was entitled to his three months notice period salary.