The House of Representatives has proposed a Bill that would make it illegal for employers and corporate entities in the country to delay or fail to pay their employees’ salaries.
The Employees Remuneration Protection Bill, 2023 is sponsored by Wale Hammed, a member of the House, representing the Agege federal constituency in Lagos State.
Key Details of the Bill
- It is unlawful for any employer to “refuse or neglect to pay the remuneration of his employees, as provided under this Act,” according to Section 7 (1) of the Bill, which has passed its first reading.
- Section 8 (1) of the bill stipulates that if an employee’s compensation remains unpaid beyond the specified period permitted by this legislation, the employee may submit a written demand to their employer for the payment of their entitlement if they wish to assert their claim.
- Nonetheless, it stipulates that “if an employee fails to remit payment within five business days following service of a demand under Section 9 of this bill, the employee may petition the court for redress by filing a motion on notice.”
- As a result, the legislation imposes a jail term of three to six months, without the possibility of a fine, on employers who are found guilty of failing to pay the salaries of their workers.
- When a corporate entity fails to adhere to a court order regarding the remuneration of its employees, it will incur a fine of N10,000 per day of default, or “be sealed off for a period not exceeding three months, provided that the default extends beyond two months.”
- Alternatively, the suggested legislation imposes a penalty of N10,000 on any officer or agent of the organization, government parastatal, agency, body, or institution who deliberately or knowingly authorizes or permits the default or noncompliance with the directive until it is complied with.
- As mandated by the legislation, employers are obligated to provide written terms of employment to resuming employees within fourteen working days of the employee’s return to work for terms of employment exceeding one month.
- The employment contract, which shall be executed by the employer and employee, shall comprehensively outline the terms and conditions, remuneration, and methods of payment, in addition to the character of the employment and the procedure for terminating it by either party.
- In addition, Section 27 of the proposed legislation stipulates that an employee’s petition to the court for payment of remuneration shall not serve as grounds for “disciplinary action, inquiry, suspension, or termination of the applicant by the employer.”
- By Section 28, in the event of an employer’s bankruptcy, prioritization shall be given to the payment of all outstanding remuneration to employees.
More Insight
A similar bill was proposed by the current Chief of Staff to the President, Femi Gbajabiamila when he was a speaker of the House of Representatives.
The proposal was contained in the ‘Employees/Workman (Unpaid Wages Prohibition) Bill 2016’ but was recalled for reconsideration by the 9th Assembly, where it passed the first reading in July 2019.
In the explanatory note, Gbajabiamila had said:
- “This bill seeks to provide for the prohibition of late payment, non-payment, and underpayment of workers’ wages in Nigeria and prescribes penalties for violations and for other matters connected thereto.”