Introduction

With the enactment of the National Minimum Wage (Amendment) Act 2024, the Federal Government has increased the statutory minimum wage to ₦70,000 per month, thereby imposing new legal obligations on employers in both the public and private sectors. The enactment is aimed at improving workers’ welfare. However, it also raises critical legal questions regarding compliance, enforcement, contractual obligations, and industrial relations.

Statutory Framework Governing the Minimum Wage in Nigeria

The principal legislation regulating minimum wage in Nigeria is the National Minimum Wage Act 2019, as amended by the National Minimum Wage Act  (Cap. N61 Laws of the Federation of Nigeria 2024). The Amendment Act increased the national minimum wage to ₦70,000 per month and reduced the wage review period from five years to three years.[1]

Section 3 of the Act makes it mandatory for every employer to pay a wage not less than the prescribed minimum to eligible workers.[2] Any agreement or contract stipulating a wage below the statutory minimum is rendered null and void to the extent of its inconsistency with the Act.[3]

The Act applies to both public and private sector employers, subject to limited exemptions such as establishments employing fewer than twenty-five workers and certain categories of casual, part-time, or commission-based employment.[4]

Legal Obligations of Employers Under the New Minimum Wage

Contractual Adjustments

Employers are legally required to review and adjust existing employment contracts to reflect the new minimum wage. Failure to align contractual remuneration with the statutory minimum constitutes a breach of statutory duty and may expose employers to claims for wage arrears and damages.

Record-Keeping and Compliance

The Act imposes a duty on employers to maintain accurate wage and employment records for inspection by labour officers.[5] Non-compliance with record-keeping requirements attracts statutory penalties of  a fine of #75,0000.

Enforcement Mechanism of the new minimum wage

Failure to pay the prescribed minimum wage constitutes a criminal offence under the Act.

“9.—(1) An employer shall pay to the workers a wage not less than the national minimum wage, subject to statutory deductions.
(2) Any employer who fails to comply with subsection (1) commits an offence and is liable on conviction to pay—

(a) a fine not exceeding 5 % of the offender’s monthly wage;
(b) all outstanding arrears of the workers’ wages; and
(c) an additional penalty of not less than the prevailing Central Bank of Nigeria lending rate on the wages owed, for each month of continuing violation,
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.[6]

Labour officers of the Federal Ministry of Labour and Employment are empowered to inspect workplaces, examine records, and institute prosecutions against defaulting employers. In addition, disputes arising from the implementation or interpretation of the minimum wage fall within the exclusive jurisdiction of the National Industrial Court of Nigeria (NICN) pursuant to section 254C of the Constitution of the Federal Republic of Nigeria 1999 (as amended).[7]

Industrial Relations and the Right to Strike

Non-payment of the statutory minimum wage may give rise to trade disputes capable of triggering lawful actions against the employer. Under the Trade Unions Act, workers are entitled to embark on strikes in furtherance of trade disputes, including disputes arising from breaches of statutory employment rights.

Labour matters, including minimum wage regulation, fall within the exclusive legislative competence of the National Assembly under the Exclusive Legislative List of the Constitution.

Consequently, the minimum wage law is binding on all states and employers across the federation. The NICN has repeatedly affirmed that labour statutes must be interpreted purposively in favour of protecting workers’ rights. In Amodu v Amode, the Supreme Court emphasised that labour laws are social legislation designed to correct inequality between employers and employees.[8]

While the new wage strengthens workers’ economic rights, it also places increased financial and compliance burdens on employers, particularly small and medium-scale enterprises. Nonetheless, economic hardship does not excuse statutory non-compliance, as Nigerian courts have consistently held that inability to pay is not a defence to breach of labour legislation.

Employers are therefore advised to implement compliance strategies, including payroll restructuring, contract reviews, and internal audits, to mitigate legal risk.

Conclusion

The National Minimum Wage (Amendment) Act 2024 has far-reaching legal implications for employment relations in Nigeria. It reinforces the supremacy of statutory labour standards over contractual arrangements, expands employer liabilities, and strengthens enforcement mechanisms through criminal sanctions and judicial oversight. While the new wage regime aims to improve workers’ welfare, strict compliance is essential to avoid litigation, penalties, and industrial unrest. Ultimately, it success will depend on effective enforcement, judicial interpretation, and good-faith compliance by employers across Nigeria.

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[1] Section 1,National Minimum Wage (Amendment) Act 2024

[2] National Minimum Wage Act 2019, section 3 (2)

[3] Ibid, section 3 (3)

[4] Ibid, section 4

[5] National Minimum Wage Act 2019, s 7.

[6] Ibid, s.9

[7] Constitution of the Federal Republic of Nigeria 1999 (as amended), s 254C.

[8] Amodu v Amode (1990) 5 NWLR (Pt 150) 356.

CONTRIBUTORS

Ojienoh Segun Justice Esq.,

Lead Partner, EKO SOLICITORS & ADVOCATES