Hire your first employee in Nigeria

Confirm that your business is registered with CAC before hiring a formal employee. Employees need a registered employer for tax and pension purposes. If you only need short-term help, consider a contractor arrangement first.

Prepare an employment contract. It must include: job title, salary, working hours, leave entitlement, notice period, and confidentiality/IP clauses. Use Lawpadi's Nigerian employment contract template as a starting point, then have it reviewed by a lawyer.

Register your company for PAYE (Pay As You Earn) tax with the relevant State Internal Revenue Service (SIRS). Lagos-based companies register with LIRS. The employee's salary determines their monthly PAYE liability.

Register with the Pension Fund Administrator (PFA). Both employer and employee contribute to a pension fund — employer contributes a minimum of 10%, employee contributes 8% of monthly gross salary. Employees choose their own PFA.

Register with the Nigeria Social Insurance Trust Fund (NSITF) for employee compensation insurance. This is a mandatory contribution of 1% of the monthly payroll.

Set up payroll. SeamlessHR automates PAYE calculations, pension remittances, NSITF contributions, and payslip generation for Nigerian employees. This will save you significant manual work every month.

Open or use your existing Kuda Business or Moniepoint Business account to pay salaries. Both support bulk salary payments to multiple banks. SeamlessHR integrates with most Nigerian banks for direct payroll disbursement.

Issue offer letters and signed contracts before the start date. Keep physical and digital copies.

After 90 days, conduct a formal performance review. Document it in writing. Nigerian employment law gives employees certain protections after 3 months of employment that make termination more complex without proper documentation.