Employment Contracts in Nigeria: What You Need to Know

Employment Contracts in Nigeria: What You Need to Know

Employment contracts serve as the backbone for employer-employee relationship, so as an individual making a debut in the world of work or a seasoned professional switching jobs, it is rather crucial for you to understand the key elements  of employment contracts in Nigeria to ensure your rights are protected and your responsibilities are clear.

As stipulated by law, the contract must be signed by both parties binding them to the terms stated in the contract, as such it is pertinent to have a balanced contract that caters for the interest of both parties. This will help prevent heavy loss on the part of the employer and prevent the risk of exposing the employee to “slavery”. Where there is a Breach of the terms of the contract by either party, the aggrieved party can enforce his rights at the National Industrial Court within the jurisdiction of the aggrieved party.

In Nigeria, being able to navigate the intricacies of employment contracts starts with getting familiar with the legal framework that has been put in place to govern employment and labor relations. The primary legislation saddled with the responsibility of regulating employment contracts in Nigeria is the Labour Act (Cap 198 Laws of the Federation of Nigeria 1990). This legislation clearly states the rights and obligations of both parties while also regulating employment issues such as working conditions, termination procedures, and dispute resolution.  Other legislations include;

Among others.

Key Elements of Employment contracts In Nigeria

Just like any other contract, employment contracts must contain certain key elements to ensure its validity. These elements include;

  1. Name and address of the employer and employee
  2. A clear Description of your Job title with a detailed description of the duties attached to the role so as to prevent any misunderstanding of your role within the organization. The employer must also inform you of any changes in the duties of your role before you sign the contract
  3. The Commencement date must be clearly stated , this help you in calculating entitlements such as leave, and also the probation period
  4. Many contracts include a probation period during which either party can terminate the contract with short notice. Understanding the length and terms of the probation period is crucial as it affects job security.
  5. The contract should state whether the employment is for a fixed term or indefinite. It must also outline the conditions under which either party can terminate the employment, including notice periods and any severance pay entitlements.
  6. Ensure that the contract clearly states your working hours, and compensation for extra working periods
  7. A contract of employment should clearly define your compensation as an employee as well as the means of calculation, be informed of the your gross and net salary so you won’t be left wondering on your first payday
  8. Leave Entitlement, the contract should detail your entitlement to annual leave, sick leave, maternity/paternity leave, and any other statutory leave. It’s important to know your rights regarding paid and unpaid leave
  9. Employment contracts should include Confidentiality and Non-Compete Clauses. Many employers include clauses that protect their business interests, such as confidentiality agreements and non-compete clauses. These can have significant implications on your future employment opportunities, so understanding their scope is vital.
  10. In accordance with legal requirements, sufficient notice must be provided by the party intending to terminate the employment to the other party. The Labor act in provides for the length of notice in Section 11 of the act ;
  • one day, where the contract has continued for a period of three months or less;
  • one week, where the contract has continued for more than three months but less than two years;
  • two weeks, where the contract has continued for a period of two years but less than five years; and
  • one month, where the contract has continued for five years or more.

Understanding and carefully navigating employment contracts in Nigeria is quite key in protecting your rights as an employee and enabling a positive working environment. Before agreeing to the terms of any employment contract, be sure to consult a lawyer or any of the various Labour and employment law firms in Nigeria for proper advice.

We at eLegal Consultants can help you draft or review your employment contracts as well as advise you on the  key elements and legal protections, and by taking the necessary steps before signing, you can enter into employment with confidence and clarity. Contact us today

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