Introduction
To ensure companies operate efficiently in all sectors of the economy including the Tech and the Finance sectors, the employer-employee relationship must be properly managed.
The employee and employer relationship in Nigeria is generally governed by contractual terms. There are also various laws and regulations that guide the relationship including the Labour Act. Although the Labour Act is stated to apply to lower cadre employees and unskilled workers, it also is relied on for guidance on the minimum expectation from employers in Nigeria.
A recent update to the regulation of employee/employer relationships in Nigeria is the proposed wage review bill, which aims to increase the current minimum wage by 50% to N70,000 ($44). This increase will be subject to the National Assembly's approval before implementation is commenced. The proposed wage review is as a result of discussions between President and the Nigeria Labour Congress for better treatment of employees.
Flowing from these discussions on the treatment of employees and frequent questions we receive on the management of the employee/ employer relationship, we have set out in this article 7 key measures to adopt to properly manage employees in Nigeria.
7 Key Measures To Manage The Employee/Employer Relationship
1.Comprehensive Employment Contracts: It is important to execute employment contracts with employees. It should clearly state the responsibilities of the employee and employer, details of compensation, probationary period, termination notices during the probationary period, the employer's right to intellectual property developed, and confidentiality obligations during the term of the employment. It should also clearly set out the conditions under which any party may terminate the contract, including the notice period or compensation when notice is not provided. It is also important the employee contract states that the employee will be bound by the Employee Handbook and Policies to ensure that it is binding on all employees.
2.Share Options: A lot of startups and companies grant employees share options to encourage an ownership mindset and to improve the employee's compensation. Where share options will be granted to the employee this should be clearly stated in the contract and the milestones to be achieved for such share option to vest in the employee. The terms of the Share Option can be included in a separate agreement which should also be executed by the employee.
3.Employee Handbook and Policies: In addition to a well-drafted employment contract, a comprehensive employee handbook should be prepared to state in more detail the policies of the company and acceptable/unacceptable conduct by employees. This should include the leave policy; IP policy, actions considered to be misconduct; disciplinary procedures in the event of employee misconduct; how the disciplinary team will be constituted; whistle blowing policy amongst others. It is important to note that the Handbook is not merely a document but a vital part of the employment contract and should be implemented by the company.
4.Employment Pre-conditions: Where the employment is to be subject to any form of security or other checks, it should be clearly stated in the contract of employment. All required checks or investigations should be conducted before the employee is given a firm offer to avoid the challenges of withdrawing an offer or terminating the employment agreement at the onset of the relationship.
5.Documentation of Disciplinary Procedures: Employers must be transparent and consistent with the implementation of disciplinary actions. The disciplinary procedure should be documented, and a detailed record of actions taken should be maintained. This is to ensure that these measures are applied fairly amongst employees and that records are available in the event of an unfair dismissal proceeding.
6.Probationary Period: Employees should be appraised before the end of a given probationary period. Where the employee's performance is satisfactory, the employment should be confirmed in writing. Where an employee's probation is to be extended for failure to meet the company's expectations, a clear extension of the probationary period should be stated in writing. In the event the employer is unsatisfied with the performance of the employee and chooses to terminate the contract, the employer must adhere to the terms of the contract in terminating and ensure such termination is handled fairly.
7.Appraisals: Employees should be advised of the key performance indicators for his or her employment and regular appraisals should be carried out to help the employee understand the expectations of the employer and areas of improvement. Employers can also use the appraisal to identify gaps in the employee's skill set and support by recommending or conducting training sessions.
Conclusion
As a general note, we advise that companies continue to review their workplace practices to ensure compliance with laws, regulations, judicial decisions (particularly the Industrial Court in Nigeria), and international best practices. Essentially, employers should aim to build a healthy workplace culture and reduce difficult employee/employer issues arising.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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