The Court of Appeal in Lagos has dismissed MTN Nigeria Communications Limited’s bid to overturn a N5.1 million compensation awarded to a former employee over a controversial post-employment restriction.
The telecommunications giant had challenged the judgment of the National Industrial Court, which found the four-year restraint-of-trade clause imposed on former Procurement Manager, Theodore Nwabueze Ikpa, unreasonable.
But in a unanimous judgment delivered on July 9, 2026, the three-member appellate panel refused to interfere with the lower court’s decision.
The panel, made up of Justices Danlami Zama Senchi, Boloukuromo Moses Ugo and Paul Ahmed Bassi, upheld the National Industrial Court judgment delivered on June 13, 2018.
The legal battle dates back to December 2008, when MTN terminated Ikpa’s employment.
Ikpa had challenged his dismissal, alleging that the company failed to give him the required one-month notice or salary in lieu of notice.
He also kicked against a clause in his employment contract which he said effectively prevented him from taking up another job until retirement.
Before the National Industrial Court, Ikpa, through his lawyers led by Adetunji Adedoyin-Adeniyi, sought declarations that his termination was unlawful.
He also demanded payment of salaries up to his retirement in October 2010, retirement benefits and, alternatively, N10 million in damages over the restrictive clause.
Although the trial court dismissed most of his claims, it awarded him N5,101,674 as compensation for the four-year restriction and another N100,000 as costs.
MTN Fights N5.1m Award
Unhappy with the judgment, MTN, through its counsel, Solomon Mbadiwe, took the matter to the Court of Appeal.
The telecom giant argued that the National Industrial Court lacked jurisdiction to entertain Ikpa’s alternative claim.
MTN also insisted that the restrictive covenant was reasonable, valid and enforceable, arguing that Ikpa had failed to prove any actual financial loss.
The company maintained that the clause was meant to protect its legitimate business interests, including confidential information and trade secrets.
MTN further argued that Ikpa had voluntarily agreed to the restriction and that there was no evidence that the company stopped him from getting another job.
But Ikpa countered that the four-year restriction effectively shut him out of employment opportunities.
He also relied on evidence that MTN had previously taken former employees to court over similar clauses, arguing that this created fear among prospective employers who might have considered hiring him.
Appeal Court Says No!
In the lead judgment, Justice Senchi rejected MTN’s four grounds of appeal.
The court held that the National Industrial Court had properly exercised its jurisdiction and correctly evaluated the evidence presented before it.
The appellate court also agreed that the restrictive covenant was unreasonable and that Ikpa was entitled to compensation.
It further refused to disturb the N100,000 costs awarded by the lower court, noting that the award of costs is discretionary and ordinarily follows the event.
Declaring the appeal lacking in merit, the Court of Appeal dismissed it and affirmed the National Industrial Court’s judgment in its entirety.
MTN was also ordered to pay Ikpa an additional N500,000 in costs, bringing the total costs awarded against the company by the two courts to N600,000, apart from the N5.1 million compensation.
Two Other Justices Back Judgment
Justices Ugo and Bassi both concurred with the lead judgment.
Justice Ugo said he agreed with Justice Senchi’s reasoning and conclusion and adopted the judgment as his own, including the consequential orders on costs.
Justice Bassi also agreed that the appeal was without merit and affirmed the National Industrial Court’s judgment in Suit No. NICN/LA/05/2016, delivered on June 13, 2018.
He equally endorsed the consequential orders made in favour of Ikpa.
