Minimum Wage
National minimum wage in Nigeria is determined by the Government through the Tripartite Committee on National Minimum Wage. The Committee is tasked with reviewing and recommending a new national minimum wage (latest recommendation was made in 2024). It comprises representatives from the government, trade unions, and private sector employers. The committee’s mandate includes assessing economic conditions and workers’ needs to propose a sustainable wage. It operates under the National Minimum Wage Act, requiring periodic review and updates to the minimum wages after every three years.
Generally, wage rate is determined by the applicable collective agreement or the agreement between the worker and the employer.
There is no pre-set criterion to determine the minimum wage. National minimum wage rate is applicable to every worker except part-time workers (working for a duration shorter those for comparable full-time work in a sector or occupation); workers paid on commission or piece-rate basis; workers in seasonal employment such as agriculture; workers in merchant shipping or civil aviation; and those working in establishment employing less than 25 workers.
Minimum Wage compliance is regulated by the Ministry of Labour and Employment, and the National Salaries, Incomes and Wages Commission. In case of non-compliance with the provisions of the National Minimum Wage Act, an individual worker may file a case directly with the National Industrial Court or may file a complaint with the Ministry of Labour and Employment. Employer, in the case of non-payment of minimum wage, is liable to a fine up to 5% of the offender’s monthly wage, all outstanding arrears of the worker’s wages and in case of continuous offence, an additional penalty of not less than the prevailing Nigerian Central Bank lending rate on the wages owed provided that the power to order payment on account of wages under subsection (2) shall not derogate from the right of the worker to recover wages due to him by any other proceeding in a court of competent jurisdiction. A court may also order the employer to pay such sum, in addition to the fine, to make up the shortfall in wages below the minimum rate. The National Minimum Wage Act further clarifies that an agreement for the payment of wages less than the national minimum wage is void and of no effect.
Source: §1-17 of the National Minimum Wage Act, 2019
For updated minimum wage rates, please refer to the section on minimum wage.
Regular Pay
Wages are the remuneration or earnings (however designated or calculated) capable of being expressed in terms of money and fixed by mutual agreement or by law which are payable by virtue of a contract by an employer to a worker for work done or to be done or for services rendered or to be rendered. Wages and other payments entitled to the employee are paid in the legal tender, i.e., Naira or by prior consent, in the form of a cheque or postal order.
The wage payment period must not exceed one month. The wage payment period varies between a day and one month, depending on the period specified in the employment contract. The Employer cannot force the worker in an employment contract about where and how to spend his wages. In accordance with the Labour Act, the employer must provide every worker (not later than 3 months after the commencement of employment) a written statement which should specify, among other things, the rate of wages, the method of wage calculation, the manner and periodicity of wage payment. The wage payment period cannot exceed one month unless the written consent of the state authority has been obtained for this purpose. The Labour Act states that wages shall become due and payable at the end of each period for which the contract is expressed to subsist (daily, weekly or at such other period as may be agreed upon) provided that where the period is more than one month, the wages become due and payable at intervals not exceeding one month.
Wages must not be paid in the premises used for the sale of liquor or for the retail sale of goods, except in case that the worker is employed on such premises. An employer may make a maximum advance of one month’s wages to a worker. The minimum period for recovery of this advance is three months. Labour Act prohibits deductions from workers’ wages except in the cases specified. With the consent of labour officer, an employer may make a reasonable deduction from a worker’s wages in respect of injury or loss caused to the employer by the wilful misconduct or neglect of the worker. An employer is allowed to deduct income tax and pension contribution from the wage with the consent of the worker. Similarly, union contribution can be deducted from workers’ wages, however, workers can opt out of it. Any other kind of deduction, without prior consent, is not allowed except in cases specified by the law.
Source: §1-7, 15 & 91 of the Law of the Labour Act (Cap L1 LFN 2004)
