Understanding Employment Laws in Nigeria

Employment laws in Nigeria are multifaceted, drawing from various sources to establish a comprehensive legal framework that governs the relationship between employers and employees. These laws are crucial in protecting the rights of workers, ensuring fair employment practices, and providing mechanisms for dispute resolution.

  • Types of Workers Protected by Employment Law:

In Nigeria, the legal framework distinguishes between two broad categories of employees: “Workers” and “Non-Workers.” According to the Labour Act, Workers are those engaged in manual labor or clerical work, while Non-Workers perform administrative, executive, technical, or professional functions. The Labour Act, which is the primary legislation governing employment in Nigeria, specifically applies to Workers. Non-Workers, on the other hand, have their employment terms primarily governed by the terms stipulated in their individual contracts.

  • Contracts of Employment:

While employment contracts in Nigeria can be oral or written, the Labour Act mandates that employers issue a written contract to Workers within three months of the commencement of the employment relationship. This written contract outlines crucial details such as the nature of employment, notice period, wages, working conditions, and other essential terms. In contrast, there is no statutory requirement for written contracts for non-Workers, but it is advisable for clarity and reference purposes.

  • Implied Terms in Contracts:

Employment contracts, whether oral or written, imply certain obligations. Among these is the employer’s duty to provide work to employees and ensure a safe workplace.

  • Minimum Employment Terms:

The Labour Act sets out minimum terms and conditions for Workers, covering various aspects such as written statements outlining employment details, wages, working hours, holidays, sick leave, and maternity leave for female Workers.

  • Collective Bargaining:

Collective bargaining is prevalent in sectors with trade unions. Typically conducted at the industry level, negotiations involve the recognized trade union of the sector and employers’ associations. Some Collective Bargaining Agreements may also specify matters negotiable at the company level.

  • Hybrid Working and Remote Work:

Employers can require hybrid working arrangements, but this is subject to the terms of employment contracts. The right to work remotely depends on individual contract terms, and contracts may need to be amended to accommodate such arrangements.

  • Trade Union Recognition:

Under the Trade Unions Act, employers are obligated to recognize registered trade unions for collective bargaining purposes. The Act outlines the formation of an electoral college to negotiate with employers.

  • Employee Representation and Industrial Relations:

The Trade Unions Act provides rights for trade unions to negotiate employment terms, engage in industrial strike actions, and conduct peaceful picketing.

  • Rules Governing Industrial Action:

Trade unions are prohibited from striking unless certain conditions are met, such as not providing essential services and complying with arbitration provisions.

  • Works Councils:

The concept of works councils is not present in Nigerian law, and there are no requirements for employers to establish them.

  • Protection Against Discrimination:

The Constitution prohibits discrimination based on various grounds, including community, ethnicity, sex, religion, and the circumstances of birth. Additional legislation addresses discrimination related to HIV, disabilities, and gender-based violence.

  • Sexual Harassment:

While there are no specific laws, court rules and criminal laws recognize sexual harassment. Employers are advised to have policies and conduct periodic training.

  • Enforcing Discrimination Rights:

Employees can enforce discrimination rights through the National Industrial Court, and employers can settle claims before or after initiation.

  • Remedies for Successful Discrimination Claims:

Successful discrimination claims may result in compensation for wrongful termination and potential damages.

  • Protection for Atypical Workers:

There is no additional protection for part-time, fixed-term, or temporary agency workers.

  • Whistleblowing:

No comprehensive law exists, but sector-specific regulations, such as the Pencom Guidelines in the pension industry, protect whistleblowers.

  • Duration of Employment-Related Complaints:

Cases filed in the National Industrial Court typically take between eight months and two years to be decided.

  • Appeals Against Decisions:

Appeals against decisions of the National Industrial Court can be made to the Court of Appeal and may take two to four years to conclude, depending on the case.

  • Whistleblowing in the Banking Sector:

In addition to the Central Bank of Nigeria’s Guidelines for Whistleblowing in banks and financial institutions, it’s essential to note that the Nigerian financial sector also operates under the provisions of the Investment and Securities Act 2007 (ISA). The ISA emphasizes the protection of employees who make disclosures in accordance with its provisions. Employers are explicitly prohibited from subjecting an employee to any detriment based on such disclosures.

  • Maternity and Family Leave Rights

The Labour Act stipulates that pregnant female workers are entitled to six weeks of leave before the expected delivery date and an additional six weeks after delivery. For female Workers with at least six months of employment, the Act mandates a minimum of 50% of her salary during maternity leave.

While the Labour Act provides specific guidelines for maternity leave for Workers, the duration and benefits for Non-Workers are generally determined by the terms of their individual employment contracts. The Act also recognizes the need for nursing mothers to be allowed half an hour, twice a day, during working hours, to nurse their child.

Regarding paternity leave, the Labour Act does not have specific provisions. However, the federal government and some state governments (Enugu and Lagos States) have implemented paternity leave policies for male employees.

  • Business Sales and Employee Transfer:

In the context of business sales, employees do not transfer automatically in asset sales. Individual consent is required for each employee, and additional approval from an authorized labor officer is necessary for Workers. In share sales, employees remain employed by the same entity.

In asset sales, the novation of employment contracts and collective agreements may occur. In share sales, there is no change in the identity of the employer, and existing contracts and collective agreements continue.

  • Information and Consultation Rights:

While there is generally no statutory requirement for employers to inform or consult employees in business transfers, employers typically notify employees of proposed transfers. Specific information and consultation rights are often governed by the terms of employment contracts.

  • Termination of Employment:

Employees must be given notice of termination, as outlined in the Labour Act. The Act provides minimum notice periods based on the length of service. Non-Workers’ notice periods are determined by their employment contracts.

In asset sales, employees may be terminated if the transferee entity chooses not to employ them. In share sales, the new employer may decide to terminate certain employees in accordance with their employment contracts.

  • Dismissal and Redundancy:

Dismissal for cause (misconduct) and termination for business-related reasons (redundancy) are recognized. Employees may challenge dismissal through legal action. Special protections exist for female Workers absent due to maternity leave.

Redundancy entitlements include agreed redundancy payments, salary in lieu of notice, accrued salary, accrued but unutilized annual leave, unpaid incentives or bonuses, and reimbursement of expenses.

  • Restrictive Covenants:

Restrictive covenants are generally unenforceable unless deemed reasonable and necessary to protect proprietary interests. Covenants of 12 months or less are typically enforceable, with a maximum restraint of trade of two years allowed by law.

  • Data Protection and Employee Privacy:

Employee data protection is governed by the Nigerian Data Protection Regulation 2019. Personal data cannot be transferred outside Nigeria without proper consent or supervision by the Attorney General of the Federation. Employees have the right to obtain copies of their personal information.

  • Court Practice and Procedure

The National Industrial Court of Nigeria (NICN) has exclusive jurisdiction over employment-related complaints. The NICN may refer matters to alternative dispute resolution (ADR) for conciliation or mediation before proceeding to a hearing. Filing fees apply, and parties are expected to comply with the court’s rules and procedures.

These additional points provide a comprehensive overview of the legal landscape surrounding whistleblowing, maternity and family leave rights, business sales, termination of employment, restrictive covenants, data protection, and court procedures in the Nigerian employment context.


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