EMPLOYEE COMPENSATION SCHEME IN NIGERIA
The Employee Compensation Act of 2010 establishes the Employee Compensation Scheme, which provides adequate and timely compensation for employees who suffer diseases or injuries in the course of employment.
The National Social Insurance Trust Fund (NSITF) provides a defined scheme through social insurance method for employees in the private and public sector. It is targeted at protecting employees or their families from financial difficulties in the event of death or permanent incapacitation as a result of work-related disease or injury. The NSITF is applicable to all employees in the public and private sector throughout Nigeria.
The private sector makes contributions for their staff to the funds by virtue of a scheme known as called employee compensation scheme. The employer rate of contribution is 1% of the total payroll, consisting of the total emoluments.
Steps for NSITF employee Registration
Upon the completion of the processes, the applicant is further required to apply for the Certificate of Compliance.
In conclusion, it is important that every company register its employees for the National Social Insurance Trust Fund (NSITF) to affirm its compliance with the Employee Compensation Act 2010 and to also contribute to the employee’s compensation scheme.
The importance of registration cannot be overemphasized as Employee compensation provides a form of social security for workers who become incapacitated in the course of employment or their dependents in the event of death.
By Labour and Employment Law Team at Resolution Law Firm