Employment contracts should be in writing and should state the role, location, remuneration and currency, probation, working arrangements, leave, benefits, confidentiality, intellectual property, data use, discipline, termination and dispute handling. Nigerian mandatory rules may override inconsistent terms.

Core employment obligations

The national minimum wage was increased to NGN70,000 per month by the 2024 amendment, subject to statutory exclusions, and the review interval was shortened to three years.

Under the Pension Reform Act 2014, minimum pension contributions are generally 10% by the employer and 8% by the employee on monthly emoluments. If the employer bears the whole contribution, the minimum is 20%. Covered employers must also maintain group life insurance of at least three times annual total emolument for each employee.

The Nigeria Social Insurance Trust Fund describes the Employees’ Compensation Scheme contribution as employer-funded at 1% of monthly payroll. The Industrial Training Fund states that an employer with at least five employees, or fewer than five employees and annual turnover of at least NGN50 million, contributes 1% of annual payroll.

PAYE must be registered and operated with the relevant state authority. Benefits, housing, school fees, equity awards and offshore remuneration may require payroll treatment. Expatriate status does not by itself determine tax residence or remove Nigerian payroll obligations.

Workforce policies and termination

An employer should adopt proportionate policies on conduct, harassment, grievances, discipline, whistleblowing, health and safety, IT, privacy and anti-bribery. Employee and contractor agreements should assign business IP and protect confidential information.

Termination should follow the contract and applicable law. The employer should check notice, accrued pay and benefits, pension and tax records, return of assets, access removal, confidentiality and post-termination restrictions. A redundancy programme requires separate legal and workforce planning. Do not assume that payment in lieu cures a discriminatory, retaliatory or procedurally defective decision.

Practical launch steps

Prepare local contracts and policies; register payroll, pension, NSITF and ITF where applicable; secure group life cover; implement health and safety; publish employee privacy information; establish time, leave and payroll records; and create a documented onboarding and exit process.