NIGERIA – EMPLOYER OF RECORD

For companies that want to hire employees in Nigeria, prior to figuring out local labor laws and registering a branch office or subsidiary, Employ Africa offers an Employer of Record Service which puts your employee on our locally compliant payroll in Nigeria, and assigns the employee to work full-time and exclusively for our client. Our services turn payroll into a simple monthly invoice. The Employer of Record Platform makes it easy to hire employees overseas with minimal time and expense.

When an employee is hired via a PEO, the employee is hired as an extension of a company that is already legally registered as an employer in-country. We process salaries, take care of personal income tax and set up the employee’s local benefits.

We take care of human resources, employment, and personal income tax reporting issues and allow you to concentrate on the project, rather than manage administrative issues.

Professionals can rest assured that their payroll and benefits will be managed exactly as they would be for any local company, and they can focus on the role for which they were hired.

Nigeria is located in West Africa on the Gulf of Guinea. Nigeria is the most populated country in Africa and the seventh most populated Country in the world, with 184 million people. 500 different ethnic groups live in Nigeria, the largest of which are the Hausa, Igoband, and Yoruba. The official language is English. Nigeria’s GDP of USD 568 billion contracted in the first quarter of 2016 by 0.4%. The unemployment rate is 12.1%, although youth unemployment is 21.5%. Oil and gas account for 91% of Nigeria’s exports.

When negotiating terms of an employment contract and offer letter with an employee in Nigeria, it may be useful to keep the following in mind:

Public Holidays

Bonus

Some companies pay a 13th month bonus, called a 13th Cheque. Annual bonuses and performance-based bonuses are common in Nigeria.

Working Hours

The labour law requires one 24-hour rest period every seven days and a one hour break per six hours of work.

Vacation

Employees are generally entitled to six days of paid annual leave after one year of employment.

Sick Leave

In general, employees are entitled to 12 days of paid sick leave per year.

Maternity/Paternity Leave

Female employees are generally entitled to 12 weeks of maternity leave at 50% of pay.

Paid paternity leave is available in the Lagos and Enugu States of 2 weeks and 3 weeks respectively.

Termination/Severance

Nigeria has “at-will” employment. In general employers should provide written notice of dismissal and give the employee an opportunity for defence.

Probationary periods of up to three months, or longer if negotiated, are permitted.

There is no statutory severance pay.

Taxes

Employees who make more than ?3,000 contribute 2.5% of their wages to the National Housing Fund.

Contributory Pension Scheme:

• Employers contribute at least 10% of employee monthly emolument
• Employees contribute at least 8% of monthly emolument

Health Insurance

Nigeria has a National Health Insurance Scheme. Private heath insurance is also available.

Additional Benefits

Common benefits include:

• pension plans
• dental benefits
• life insurance
• stock options
• car allowance
• mobile phone

Employment Contracts

Fixed term contracts are permitted.

It is legally required to put a written employment contract in place in Nigeria, in the local language, which spells out the terms of the employee’s compensation, benefits, and termination requirements. An offer letter and employment contract in Nigeria should always state the salary and any compensation amounts in Nigerian naira rather than a foreign currency.

This information is provided as general accepted information and is not intended as advisory services.

Why Employ Africa

Employ Africa makes it easy to hire employees in Nigeria with minimal time and expense. We put your employee on our locally compliant payroll and you get a simple monthly invoice. We can also process expense reports, handle personal income tax issues, and set up statutory local benefits with the streamlined ease of a company that has done it hundreds of times before, enabling you to skip the difficulty of creating a subsidiary and instead focus on building your business.

If you would like to discuss how we can provide employee leasing or PEO solution for hiring an employee in Nigeria, please contact us [email protected]