Hire in Nigeria

Employer of record in Nigeria

If a lack of speed or local expertise are among your top concerns when expanding to or employing workers in Nigeria, an employer of record may be the best option for achieving your global growth objectives.

An employer of record, sometimes known as an international PEO, enables you to quickly hire and onboard workers in Nigeria ―often in as little as two weeks―without having to take on the cost and risk of establishing a local entity.

Learn about the hiring, employment, payroll and benefits requirements for workers in Nigeria and how our employer of record service, EOR, and local HR experts can help you manage your international employment needs. 

Hiring in Nigeria

The primary source of employment law in Nigeria is the Labor Act. While the law generally covers terms and conditions of employment, it applies only to lower cadre workers, i.e. manual laborers or clerical workers, and does not apply to administrative, executive, technical, or professional functions. Other important employment laws include the Trade Union Act, the Employees Compensation Act, the Factories Act, the Pensions Act, and the Trade Disputes Act.

The Labor Act mandates that an employer provide the employee with a written contract specifying the particulars of employment not later than three months after the beginning of the employee’s period of employment with the employer. 

Employment contracts in Nigeria

As you look to hire employees in Nigeria, here are some standard regulations you’ll need to know to create a compliant contract, as well as how an employer of record and PEO can provide support for your unique HR needs.

Working hours

Normal hours of work are set by mutual agreement or by collective bargaining within the organization or industry concerned.

The Labor Act prohibits children under 16 from working more than four consecutive hours or more than eight hours in one day.

An employee is generally allowed one or more rest periods, totaling one hour, during a workday of six hours or more. A worker is entitled to one rest day of 24 consecutive hours per week.

Overtime means any hours worked more than regular work hours as defined by the employment contract or a collective bargaining agreement.

Compensation

As you consider the appropriate salary to offer new employees, keep in mind:  

• The monthly minimum wage is 30,000 naira per month for employers with 50 or more employees 
• The Labor Act does not address wage rates for overtime 
• Wages must be paid at least monthly 
• Employees who work on a public holiday are entitled to 200% of their regular pay 

As your employer of record in Nigeria, we can provide you with resources and insights about employee compensation, so you are better equipped to make a competitive employment offer.

Bonuses

The labor code does not address bonuses.

Probationary period

An employment contract may include a probationary period, and it may vary from three to six months.

Termination and severance

Under the Labor Act, either party to an employment contract may terminate the agreement on the expiration of proper notice: 

• one day following less than three months of service 
• one week following three months to two years of service 
• two weeks following two to five years of service 
• one month following more than five years of service 

Although the Labor Act does not provide for severance pay, upon termination an employee must be paid wages for hours worked and accrued annual leave, exclusive of overtime.  

Employee benefits and paid leave in Nigeria

When negotiating terms of an employment contract with a candidate in Nigeria, here are some of the statutory benefits and paid leave requirements to keep in mind, as well as how an employer of record can support your company’s benefits strategy.

Maternity leave

A pregnant employee is entitled to 12 weeks of maternity leave starting six weeks before her due date. If she has worked for the employer for six months or more before the beginning of her maternity leave, the employer is required to pay her at the rate of 50% of her regular wages during maternity leave.

The employee is not allowed to work during the six weeks after birth.

Vacation

Employees are entitled to annual leave of at least six working days at full pay after 12 months of continuous service.

A worker under 16 years of age, including an apprentice, is entitled to at least 12 working days of annual leave at full pay.

The employee and the employer may agree to defer accrued annual leave for up to 24 months, but an employer may not pay wages in lieu of annual leave.

Holidays

The following are Nigeria’s national public holidays: 

• New Year’s Day 
• Good Friday 
• Easter Monday 
• Workers’ Day 
• Democracy Day 
• Nigerian National Day 
• Christmas 
• Boxing Day 

In addition, the following Islamic holidays are also celebrated whose dates vary every year: 

• Eid al-Fitr, the end of Ramadan 
• Eid al-Adha, the commemoration of Abraham’s willingness to sacrifice his son 
• Eid-el-Malud, the celebration of the birthday of the Prophet 

Public holidays that fall on a weekend are not moved to another date.

Sick leave

An employee is entitled to 12 days of paid sick leave per year, subject to certification by a health care provider.

Health coverage

There is no standard retirement age, the age determined by the individual worker’s terms and conditions of employment, although if an employee retires before age 50, there will be a six-month waiting period to receive benefits.

For employers with 15 or more workers, the total social security pension contribution is 18% (10% for employers and 8% for employees) of the employee’s total “monthly emoluments”— total earnings defined in the employee’s contract of employment—and “shall not be less than a total sum of basic salary, housing allowance and transport allowance.”

An employer may elect to take full responsibility for the pension contribution, in which case the total contribution rate will be 20% of the employee’s monthly emolument.

Additional benefits

In addition to healthcare benefits, employees in Nigeria are entitled to pension, which is funded by government tax revenues, as well as workers compensation, which is covered through mandated employer insurance. Employer social costs will cover a large portion of employee benefits in Nigeria, but we can consult with you about supplemental coverage options, such as additional pension contributions or life insurance if needed.

Updated: January 17, 2024 

Employee onboarding with an employer of record in Nigeria

We write and validate all local employment contracts, streamlining the onboarding process for you and your Nigeria employees—all you have to do is provide relevant information and review and approve the employment agreement. As your employer of record in Nigeria, we will:   

• Schedule a welcome call to discuss HR and employment information for Nigeria, as well as answer any questions 
• Prepare a customized employment contract in English or other local language 
• Share the employment contract and benefits information with the new employee for signature and review 
• Gather tax and banking information from the employee to set up payroll 
• Provide a local point of contact to the employee to answer any questions regarding their employment, local HR or payroll 

The entire onboarding process for the employee is often completed in as little as two weeks. 

Partner with Safeguard Global as your Nigeria employer of record and PEO

With over a decade of service, we are the longest-serving employer of record and PEO provider in the international market. Organizations around the world rely on EOR, our employer of record solution, to expand and hire in 170+ countries around the world, quickly and compliantly.

We’ve seen just about every global employment circumstance imaginable—and with our extensive knowledge of local law and culture, we know what it takes to get employment right in Nigeria. We provide written contracts in the local language, salaries in the local currency and HR support in your employees’ time zone.

Additionally, as a global payroll provider we support payroll administration—including payments, filings and other calculations— all around the world and can accommodate the payroll outsourcing needs of any size organization.

Whether you’re looking to hire as part of a strategic expansion or to meet specific talent needs, our global solutions advisors can walk you through your international hiring options so you can make the right choice for your organization. Contact us today. 

Disclaimer

The information provided on or through this website is for informational purposes only and does not constitute legal advice. Safeguard Global expressly disclaims any liability with respect to warranty or representation concerning the information contained herein, including the lost essence, interpretation, accuracy and/or completeness of the information in transit and language translation.