COUNTRY

Written Agreements

Employers must give employees a written statement in the form of a contract no later than three months after beginning employment. The statement must specify employer and employee particulars, the nature of employment, leave, sick pay, holidays, notice period, and wage rate. If an employee is given written employment contract, written statement is not required.

Oral Agreements

While the Nigerian Labour Code defines recognizes the use of oral contracts of employment, it mandates that employees have a written agreement with their employer within three months of the employee's start date.

Implied Agreements

In Nigeria, although the Labour Act recognizes implied contracts, there are no provisions or guidance on implied employment agreements. The law requires employers to provide a written statement stating the terms of employment within three months of the employment start date.

Under the new National Minimum Wage Act 0f 2019, general full-time working hours are fixed by agreement or collective bargaining within the enterprise or industry. When there is no arrangement for collective bargaining, an Industrial Wages Board may set the general working hours. The Labour Act does not indicate a standard number of weekly working hours.

New Year’s Day - January 1; Good Friday - date subject to change every year; Easter Monday - date subject to change every year; Workers Day - May 1; Democracy Day - June 12 (declared as the official day of celebration for Democracy Day and changed from May 29); Independence Day - October 1; Eid ul Fitr - date subject to change every year; Id el Kabir - date subject to change every year; Id el Maulud - date subject to change every year; Christmas Day - December 25.

An employee who has worked for a continuous period of 12 months is entitled to a paid leave of at least 6 working days. Employees under 16 years of age are entitled to 12 days of annual leave. Annual leave is paid as the employee's basic pay, excluding all allowances and overtime pay.

Annual leave must be taken by the end of the year in which it is earned, but it can be deferred by mutual agreement for a maximum of 24 months. Both earned and deferred leave has to be taken within these 24 months.

An employee is entitled to 12 days of paid sick leave per year, provided that the temporary illness is certified by a registered medical practitioner. Benefits for sick leave are paid as the employee's basic pay, excluding all allowances and overtime pay.

A female employee is entitled to 6 weeks of maternity leave before and 6 weeks after the expected date of childbirth, provided that the employee has obtained a medical certificate from a registered medical practitioner. Maternity leave is paid at a rate of at least 50% of the wages the employee would have earned had they not been absent, provided that the employee had been working for the same employer for a period of 6 months before the leave.

The employer is not liable to pay for any medical expenses incurred by a female employee during pregnancy or childbirth.

Employers are prohibited from terminating a female employee during an absence after maternity leave if this absence is due to inability to resume work related to conditions arising from delivery. Extended maternity leave is unpaid.

The Labour Act of Nigeria offers no provisions regarding paternity leave for private employees. However, married male public servants are given two weeks of paid paternity leave. Paternity leave is also available in case of adoption of a baby less than 4 months old.

Minimum Wage

In Nigeria, the National Minimum Wage Act mandates that all employees' minimum wage be NGN 70,000 (Nigerian nairas) per month, effective July 2024. The minimum wage is set to be reviewed every 3 years.

The following establishments are exempt from the obligation to pay the national minimum wage:

• An establishment with fewer than 25 employees
• An establishment which employs employees on a part-time basis (under 40 hours per week)
• An establishment at which wages are paid through commissions or on a piece-rate basis
• Employees in seasonal employment (for example, agriculture) and seamen or crew members of an aircraft

Employees are paid according to the periodicity determined in their employment contracts. No contract shall provide for the payment of wages at intervals exceeding 1 month unless the written consent of the State Authority has been previously obtained.

Overtime, Holiday & Vacation Pay

All employees are to be paid overtime for hours worked in excess of those agreed upon in the employment contract. The employment agreement also determines overtime rates. For work completed during weekly rest periods and public holidays, employees are entitled to a day off within 14 days in lieu of work done or monetary compensation according to overtime rates.

Employees have a right to at least 6 days of annual leave paid at their basic wage, excluding all allowances and overtime pay.

Notice Period

The notice period is calculated based on the length of employment:

• 1 day, where the employment has lasted 3 months or less
• 1 week, where the employment has lasted for more than 3 months but less than 2 years
• 2 weeks, where the employment has lasted between 2 years and less than 5 years
• 1 month, where the employment has lasted for 5 years or more

Any notice period of more than 1 week has to be in writing. The notice period requirement can be waived by paying the employee's basic wages (excluding overtime and other allowances) in lieu of notice. Contracts can be terminated without notice in case of gross misconduct by either party.

Severance Benefits

Severance payments are not mandatory under the law but may be specified in employment contracts or collective bargaining agreements. In addition, the Labour Act gives the Minister of Labour the authority to enact regulations on severance pay for employees made redundant.

Pension

There is an established Contributory Pension Scheme where employers and employees are mandated to contribute monthly to maintain a Retirements Savings Account (RSA) in employees' names with any Pension Fund Administrator of choice.

This scheme's savings are accessible at retirement at the age of 50 or after six months of retirement if they retire earlier before 50 years of age. If a person retires before reaching the age of 50 years due to mental or physical incapacity, they can have immediate access to their RSA. The amount of pension issued after retirement depends on the balance in the employee's RSA account. The pension cannot be less than 50% of their monthly pay at the time of retirement.

Contributions to the pension fund are tax-deductible, and the pension payments are exempt from tax.

Dependents/Survivors Benefits

In case of an employee's death, the employer must pay the benefits of the life insurance policy (a minimum of three times the Annual Total Emolument (ATE) of the employees) to the dependents named by the employee. Usually, the employee's widow/widower and children are considered as dependents, but, in certain circumstances, the employee can choose to name other dependents. Dependent children receive compensation until the age of 21 years.

In the event of an employee's death due to an occupational injury, dependents are also entitled to compensation at the rate of 30 to 90% of the deceased's last monthly salary. This benefit is paid from contributions made by employers.

Invalidity Benefits

The Contributory Pension Scheme mandates employees and employers to make monthly contributions to employees' Retirement Savings Account (RSA). In the event of early retirement from work (before the age of 50 years) due to permanent disability, an employee can withdraw up to 25% of the amount in their RSA and start a monthly or quarterly pension with the remaining amount in the account.

Employers are also required to have an Employees' Compensation Fund, maintained by the Nigeria Social Insurance Trust Fund, for the following purposes:

• Payment of adequate compensation to all employees or their dependents in case of injury, disease, or disability arising out of or in the course of employment
• The provision of rehabilitation to employees with work-related disabilities

Payment of benefits for work-related disability depends on the type and degree of disability.