AI agents for business finance: what they can and can't do
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The short answer
An employee who lives and works in Nigeria is likely to be able to rely on Nigerian employment law and bring claims at Nigeria's National Industrial Court, whatever law the contract names. Nigeria's Labour Act requires written terms within three months of starting, covering pay, hours, holidays, sick pay and notice. Add clear clauses on the employing entity, currency, tax and pension deductions, confidentiality, IP, data and equipment.
A South African company hiring someone in Lagos to work remotely often reaches for its standard SA contract and changes the address. That leaves gaps. The employee is working in Nigeria, paid in Nigeria and protected by Nigerian law in ways the SA template does not reflect. This guide covers which law is likely to apply, what Nigerian law requires the contract to say, and the clauses that prevent disputes.
Which law governs
A contract can name a governing law, but that does not stop an employee in Nigeria from relying on Nigerian protections. Adeola Oyinlade & Co's June 2026 analysis of worker classification notes that a reclassified worker may claim Labour Act entitlements and bring wrongful or unfair termination claims at the National Industrial Court of Nigeria. In practice, draft as though Nigerian law will be applied to the employment relationship, whichever law you name for the rest of the contract.
First decide who the employer is. If your SA company employs the person directly with no Nigerian entity, Nigerian payroll duties and tax presence questions follow; see employer of record or Nigerian entity. Many SA companies employ through a Nigerian subsidiary or an employer of record, and the contract is with that entity.
What the Labour Act requires in writing
Section 7 of the Labour Act requires the employer to give a written statement of terms within three months of the start of employment, and to notify changes within one month. According to WageIndicator's summary, the statement covers:
- the employer's name and the worker's name and address;
- place and date of engagement, and the nature of the job;
- the end date if the contract is for a fixed term;
- notice to be given by each side;
- pay and how it is calculated and paid;
- hours of work, holidays and holiday pay;
- sickness and sick pay; and any special conditions.
Minimum terms worth matching
| Topic | Labour Act position |
|---|---|
| Notice (s.11) | 1 day up to 3 months' service; 1 week from 3 months to under 2 years; 2 weeks from 2 to under 5 years; 1 month for 5 years or more. Notice of a week or more in writing; pay in lieu allowed |
| Sick leave (s.16) | Up to 12 working days' paid sick leave a year, certified by a registered medical practitioner |
| Annual holiday (s.18) | At least 6 working days after 12 months' continuous service; no pay in lieu while the contract continues |
| Maternity (s.54) | 6 weeks before and 6 weeks after confinement, with at least 50% of wages after 6 months' service |
| Pay intervals (s.15) | No longer than one month |
Section 91 excludes people in administrative, executive, technical or professional functions from the Act's definition of "worker", so some of these minimums may not apply by statute to senior or professional hires. Most employers still offer at least these terms; contracts below them invite disputes.
Clauses an SA company should add
- Employing entity and place of work: who employs, and that the role is performed from Nigeria.
- Currency and pay date: the currency of salary and how any conversion works. See dollars or naira for Nigerian staff.
- Deductions: PAYE, pension (employee's 8% minimum under PenCom rules) and any others, with the employee's consent where required.
- Confidentiality: Nigeria has no specific trade secrets statute, according to a 2023 Chris Ogunbanjo LP analysis, so protection rests on contractual confidentiality terms. Write them out in full.
- Intellectual property: that work created in the course of employment belongs to the employer, with an assignment of rights.
- Data protection: how the employee handles customer data, and that their own data may be processed in South Africa. See POPIA and NDPA.
- Equipment and costs: who provides the laptop, internet and power backup, and what happens on exit.
- Working hours and availability: core hours and how overtime or weekend work is handled.
- Termination and disputes: notice, garden leave if any, and the forum for disputes.
Probation
WageIndicator's summary notes that probation is not regulated by Nigerian law and is commonly three to six months. If you want one, state its length, the notice during it and how confirmation happens; the Labour Act notice periods above still set the floor for staff the Act covers.
Common mistakes
- Using an SA contract that refers to SA statutes the employee has no connection with.
- Calling the person a contractor while managing them as an employee; see paying Nigerian contractors.
- Restraint clauses so wide a court is unlikely to enforce them.
- No written statement within three months.
Where Pryme fits
A Nigerian employing entity with a Pryme Business Account can run naira payroll, and the Compliance agent can track contract reviews and probation dates for a person to act on. Outside Nigeria, Pryme's activities are carried out through regulated partners.
Questions people ask
Can I use South African law for a remote employee in Nigeria?
You can name it, but an employee working in Nigeria may still rely on Nigerian protections and bring claims at the National Industrial Court.
What must a Nigerian employment contract include?
Labour Act s.7 requires written terms within three months: parties, place and date, job, pay, hours, holidays, sick pay, notice and any fixed end date.
What notice period applies in Nigeria?
Under s.11, from one day (up to three months' service) to one month (five years or more), unless the contract gives more.
How do I protect confidential information with a Lagos employee?
Use detailed contractual confidentiality and IP clauses; Nigeria has no specific trade secrets statute.
Sources
- Labour Act (Nigeria), full text · accessed Oct 2026
- WageIndicator Nigeria, Contracts and dismissals (updated 15 March 2025) · accessed Oct 2026
- Adeola Oyinlade & Co, worker classification in Nigeria (18 June 2026) · accessed Oct 2026
- Chris Ogunbanjo LP via Mondaq, Trade secrets and confidentiality: the Nigerian perspective (29 August 2023) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.