Employer of Record in Nigeria | Employee Benefits

Employee Benefits in Nigeria

Bonuses and additional payments

In Nigeria, there is no statutory requirement for employers to provide annual bonuses to employees. Nonetheless, it is customary and often expected practice for employers to offer an end-of-the-year bonus, often referred to as a “Christmas bonus,” equal to one month’s wages or salary.

Annual leave

Employees in Nigeria are entitled to paid vacation leave after completing one year of service. The statutory entitlement is six working days per year for adult employees, increasing to 12 days for employees under 16 years of age. This leave is fully paid and can be taken throughout the leave year, as agreed between employer and employee.

Additional leave may be offered as part of an employment contract, though it is not required by law. Many employers offer enhanced leave policies to stay competitive and improve retention.

Statutory leave must be taken within the year it is earned. Payment in lieu of unused leave is only permitted upon termination of employment.

Sick leave

In Nigeria, personal and sick leave are governed by the Labour Act. Employees are entitled to up to 12 working days of paid sick leave per year, provided the illness is certified by a registered medical practitioner. Employers may offer more generous sick leave policies through employment contracts or collective agreements.

Parental leave

Employers must provide six months of paid maternity leave, typically taken after childbirth, for each pregnancy, excluding adoptive and surrogacy-commissioning mothers. Pregnant employees in the public sector are eligible for benefits without explicit social security contribution requirements, while private-sector policies may vary, with medical documentation required to confirm the pregnancy.

Additional benefits

In addition to the above, employers are legally required to provide further benefits under Nigerian labor laws.

• Pension contributions: Employers contribute a minimum of 10% of an employee’s monthly salary to the Retirement Savings Account (RSA), aiding in employee retirement savings.
• National Health Insurance Scheme (NHIS): Employers with 10 or more employees are required to enroll in the NHIS, which provides healthcare, maternity, disability, and sickness benefits for employees.

Public healthcare coverage is provided to all Nigerian residents through the NHIS, offering access to medical services. However, many individuals opt for private healthcare to access a broader range of services and reduced wait times. As your workforce enablement partner, we can consult with you about supplemental coverage options, such as additional pension contributions or life insurance, if needed. We may be able to provide optional supplementary medical insurance coverage for professionals and their dependents at a more cost-effective rate.