US embassy cable - 04LAGOS462

UNCLAS SECTION 01 OF 02 LAGOS 000462 
 
SIPDIS 
 
USDOL WASHDC FOR ROBERT YOUNG 
 
SENSITIVE BUT UNCLASSIFIED 
 
E.O. 12958: N/A 
TAGS: ELAB, EPET, KDEM, NI, PGOV 
SUBJECT: Nigeria:  NLC Plans Protests Against Casualization 
in the Banking Industry 
 
1. (U) On February 26, Nigeria Labor Congress (NLC) 
President Adams Oshiomhole announced that the NLC, the 
Congress of Free Trade Unions (CFTU), and several civil 
society groups have planned demonstrations in Lagos 
beginning March 4, 2004 to protest casualization (use of 
contract labor) in the banking industry.  NLC Assistant 
General Secretary Denja Yakub told PolSpec that the decision 
to mobilize its members follows a series of failed 
negotiations between the National Union of Banks, Insurance 
and Financial Institutions Employees (NUBIFIE) and industry 
employers.  NUBIFIE, one of the NLC's 29 unions, has 
identified fifty-six Nigerian banks that employ most of 
their non-professional staff through contracts.  Since 
Nigerian labor law prohibits contract workers from joining 
unions and gives employers the option to extend benefits or 
not, many companies operating in Nigeria employ contract 
workers to reduce labor costs.  Nigerian labor law permits 
employers to hire workers through private contractors if 
length of employment does not exceed 90 days.  However, the 
NLC argues that the practice is widely abused since most 
contract employees remain with their companies for years by 
simply renewing their work agreements every three months. 
 
2. (U) Mazi Okechukwu, President of the Chartered Institute 
of Bankers of Nigeria (CIBN), an umbrella organization for 
all registered banks in Nigeria, told reporters that banks 
"will seek all avenues, including legal action, to prevent 
the NLC from disrupting banks operations."  While several 
banks have vowed to seek judicial redress to prevent the 
planned demonstrations, the NLC defends its right to 
organize such events in order to uphold workers rights and 
promote international standards pertaining to the freedom of 
association. Labor leaders are concerned, however, that the 
Federal Court set a precedent in January 2004 when it agreed 
to hear a GON claim that the NLC's plans to strike against a 
proposed fuel tax were illegal.  Although the Court 
eventually ruled in favor of the NLC, labor leaders were 
ordered not to act until the GON had exhausted its appeals. 
The NLC viewed the injunction as an infringement on its 
right to organize, since it effectively disrupted labor's 
mobilization efforts.  The NLC believes that any recognition 
or decision by the courts to hear a case involving planned 
protests against the banking industry would also constitute 
a denial of labor's right to organize. 
 
3. (U) Despite escalating tensions between industry workers 
and employers, Okechukwu said the CIBN plans to reach out to 
the NLC to seek a peaceful resolution to the dispute. In 
what appeared a desperate move to stave off the action, 
Yakub said several banks have contacted the NLC, either to 
deny accusations that they have failed to observe Nigerian 
labor laws pertaining to contract labor or to express their 
intention to comply with existing labor legislation. 
Publicly, the NLC contends that the protest will begin as 
planned unless all banks "accept unconditionally the 
existing laws regulating the operations of workers in the 
workplace," which includes the freedom of association. 
However, Yakub told Polspec the NLC has agreed to meet with 
industry representatives this week.  He said the NLC would 
likely agree to suspend protests if banks show a commitment 
to trade unionism and are willing to "enter into agreement 
on the appropriate time frame within which to regulate the 
appointment of casual workers and unionize the 
organization." 
 
4.  (U) While the NLC seeks to strengthen its credibility 
among its constituents, labor leaders hope their battle with 
the banks will provide momentum as they look to broaden the 
issue of casualization.  Concerns about the use of contract 
work are slowly moving into the national spotlight and, 
despite growing tension between Nigeria's three labor 
consortia, all unions have a common interest in forcing 
companies to employ only full-time permanent staff.  As they 
fight the battle over casualization, labor leaders are also 
stressing that companies must accept greater responsibility 
for ensuring that their contractors maintain legal and 
organizational standards in the treatment of their 
employees. 
 
5.  (SBU) Comment:  NLC officials have raised concerns 
regarding the role of U.S. organizations operating in 
Nigeria, including the U.S. Consulate, in policing its 
contractors.  The Consulate's recently severed relationship 
with ServTrust highlights challenges in using contract 
labor.  Forty contract employees were displaced on January 
31, 2004, when the Consulate decided to reduce staff by 
terminating its contract ith their employer, ServTrust. 
Although the deciion was made mre tha one month before 
the contact was officially terminated, ServTrust failed to 
warn its employees, which left them unprepared to subsist as 
they look for new jobs.  ServTrust employees and NLC 
contacts recently raised the issue with Laboff complaining 
that although the majority of the contracted employees had 
worked at the Consulate for many years, they had been paid 
substantially less than Consulate FSNs with similar job 
descriptions, and none of the contract workers received 
severance pay or benefits from ServTrust upon their 
dismissal.  Former ServTrust employees argue that the 
Consulate failed in a duty to ensure that the workers were 
treated fairly by the contractor, who they say paid salaries 
late and refused to grant sick leave.  End comment. 
 
GREGOIRE