Nigeria Employer of Record (Nigeria EoR) Services
We help companies hire and support employees and contractors in Nigeria; meeting organisation needs across local laws, tax systems, payroll and more.
Workforce Africa makes it hassle free to hire and manage your employees in Nigeria without having to first set up a subsidiary or entity in country. We handle staff contract management and onboarding, compliance taxes, payroll management and other administrative matters.
With Workforce Africa as the best Employer of Record (EoR) in Nigeria, you can now focus more on strategic activities and growing your business.
Major Cities
Abuja, Lagos, Port Harcourt
Currency
Nigerian Naira
Work Permit Required for Expats
Yes
Minimum Wage
30,000 Naira
Official Language
Nigerian Naira
Employment Contract Termination
At will with minimum of one day notice
In This Section:
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How Employer of Record (EoR) in Nigeria Works
You can expand, grow your business, onboard remote employees/contractors and manage them using our Employer of Record services.
So, instead of setting up a Nigerian entity (a costlier and time-consuming option), you can compliantly onboard new employees and commence your Nigeria-focused operations within 48 hours.
Employment and forced labour
All employers must give their employees a written agreement within three (3) months of the commencement of the employment, adequately stating the particulars of the employer and the employee, the position and job description/functions, and terms and conditions of the contract.
Forced Labour is illegal in Nigeria. Every Nigerian has the right to be free from forced labour, and this is guaranteed under the 1999 constitution and restated in the Labour Act.
However, there is an exception that gives the government the ability to demand for people to work during an emergency or crisis, and this will not be classified as ‘Forced Labour’.
Expats, Visas, & Work Permits
Employers are responsible for obtaining work & residence permits for their expatriate employees. Foreign investors must be granted expatriate quota approval to employ expatriates.
Foreign employees who fail to renew their work permit with the government face up 3 years in prison and a fine of 500,000 Naira or both. Therefore, it is important to partner with an international Professional Employer Organization (Employer of Record) to avoid these issues.
Working Hours in Nigeria
A workday in Nigeria is a standard 8 hours shift (excluding 1 hour lunch break) and 40 hours a week. Regular hours and overtime pay rates are set in the employment contracts or collective bargaining agreements.
Observed National Holidays and Vacation
Paid holidays include New Year’s Day, Good Friday, Easter Monday, Workers’ Day, Democracy Day, Nigerian Independence Day, Christmas, Boxing Day, Eid al-Fitr, Eid al-Adha and Eid-el-Malud.
Paid Leave
Rest Hours
In every period of 7 days’ work, employees are entitled to at least a day off. Also, if an employee works for more than 6 hours a day, he/she must be given 1 hour of interval on that day.
Sick Leave
Employees are entitled to 12 days’ sick leave for a temporary illness that must be certified by a medical practitioner.
Holidays
An employee after 12 months of continuous service, is entitled to a holiday with full pay of at least 6 working days (this is exclusive of all public holidays).
Maternity and Paternity Leave
All female staff are entitled to a minimum of 12 weeks maternity leave with full pay. Paternity leave is optional as the Nigerian Labour Act does not recognise paternity leave and makes no such provisions.
Statutory Deductions
PAYE (Income Tax)
Nigeria adopts a Pay-As-You-Earn (PAYE) system in calculating the personal income tax of employees. This tax rate progresses from 7% to 24% of taxable income. The taxable income band ranges from NGN300,000 to above NGN3.2 million in a year.
Pension Contribution
Employers and employees are required to make a statutory minimum contribution of 10% and 8% respectively of the employee’s monthly emoluments (i.e., Basic salary, Housing and Transport Allowance). It is important to note that the Nigeria EoR you partner with ensure that all these contributions are made correctly.
National Housing Fund (NHF)
Under the NHF law, every Nigerian earning within the minimum wage range is required to contribute 2.5% of the basic monthly salary to the NHF.
National Social Insurance Trust Fund (NSITF)
There is a mandatory employee compensation scheme whereby 1% of payroll cost is contributed to the National Social Insurance Trust Fund (NSITF). Employees who suffer from occupational diseases, injuries from accidents or death at the workplace are compensated with this fund.
Industrial Training Funds (ITF)
Every employer with five or more employees or with an annual turnover of NGN 50 million and above is obligated to contribute 1% of its total yearly payroll to the Industrial Training Fund as the employer’s contribution to the training of employees in Nigeria.
Health Insurance
The provision of health insurance for employees is common in Nigeria but is not mandatory. Private businesses provide health insurance benefits to their employees provided by accredited Health Maintenance Organizations (HMO) in the country.
PEO/EoR Companies in Nigeria like Workforce Africa have partnership with various Health insurance organisation and they will guide you to the work with the best for your employees.
Life Insurance
Group Life Insurance – A group life insurance policy as backed by the Pension Reform Act (2014), must be provided in favour of the employee for a minimum of 3 times the employee’s annual total emoluments.
Transfer of Employment
An employee must concede to his/her transfer from one employer to the other which must be endorsed by an authorised Labour officer, for the transfer to be valid. e.g., If Company A buys over Company B, the staff must sign a letter of consent for the transfer to be valid.
A Nigeria Employer of Record like Workforce Africa ensure that all employee comply with this transfer and make the transition phase seamless.
Termination / Severance in Nigeria
In Nigeria, employers and employees alike can terminate employment contracts at will. Regardless, the labor law leaves room for minimum notice periods based on the duration of the employment.
- Where an employee has been in employment for three months or less, either party may terminate the contract with a minimum of 1-day notice.
- Where an employee has been in employment for three months but less than two years, either party may terminate the contract with a minimum of 1-week notice.
- Where an employee has been in employment for two years but less than five years, either party may terminate the contract with a minimum of 2 weeks’ notice.
- Where an employee has been in employment for five years or more, either party may terminate the contract with a minimum of 1-month notice.
When giving notice of 1 week or more, it must be in writing. The Notice period depends on the contractual agreement, it can extend beyond 1 month based on the agreement between the parties involved.
An employer may terminate an employee’s contract when there is a fundamental breach of the employment contract without compensation.
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