Employers Urged: Workers’ Future Goes Beyond Salaries
The Managing Director of the Nigeria Social Insurance Trust Fund (NSITF), Oluwaseun Faleye, has advised employers in Nigeria to secure the long-term future of their workers through the Employees Compensation Scheme (ECS), stressing that focusing solely on salaries is not enough.
Speaking in Abuja during a courtesy visit from the leadership of the Oil Producers Trade Sector (OPTS) of the Lagos Chamber of Commerce, Faleye said sustainable industrial harmony depends on employers showing genuine commitment to workers’ welfare.
Workers’ Demands Go Beyond Wage Increases
Faleye explained that employees often prioritize long-term welfare and job security over wage increments.
“Workers’ demands are not always tied to wage increases. The assurance of their future — through compensation schemes, health benefits, and safety policies — often takes priority,” he said.
He called on employers to highlight welfare initiatives such as health benefits, insurance coverage, and compensation schemes as part of their workforce management strategy.
ECS Compliance Should Be Prerequisite for Contracts
The NSITF boss urged the government to make compliance with the Employees Compensation Act (ECA) a prerequisite for contract awards.
He further emphasized that employers must ensure subcontractors and suppliers also enroll workers in the ECS to avoid vicarious liabilities.
The OPTS delegation, led by Steve Ojeh, commended Faleye’s leadership but expressed concerns over the proposed increase in ECS contributions beyond the current 1% rate, as well as plans to extend contributions to cover allowances beyond basic salary, housing, and transport.
What is the Employees Compensation Scheme (ECS)?
Established under the Employees Compensation Act of 2010, the ECS provides compensation for workers who suffer work-related injuries, diseases, disabilities, or death at no cost to the employee.
Employers are required to contribute 1% of their workers’ gross salaries to the scheme, which serves as a social safety net for Nigerian employees.
Finance Act Ambiguity Threatens Workers’ Safety Net
Meanwhile, the Chairman of the NSITF Management Board, Sola Olofin, has warned that ambiguities in the Finance Act 2021 could threaten the independence and operations of the Fund.
Speaking at the 69th NSITF Board Meeting in Abuja, Olofin highlighted ongoing debates over whether contributions to the Fund should fall under the revenue classification of the Federal Inland Revenue Service (FIRS).
“Not Just Accounting — A Threat to Workers’ Security”
Olofin stressed that the issue goes beyond accounting procedures:
“This is not merely an accounting classification. It has far-reaching effects on the autonomy, operations, and financial health of the Fund.”
He called on Board members to actively support the Faleye-led management in ensuring that policymakers understand the peculiar statutory nature of NSITF contributions, which are earmarked exclusively for social security objectives.
Call for Advocacy and Policy Protection
Olofin emphasized the need for sustained advocacy to protect NSITF from regulatory overreach, warning that without clear legal protection, workers’ welfare could be jeopardized.
He said:
“We must continue our advocacy, backed by sound legal and policy arguments, to safeguard the Fund from interference that may impair its ability to meet its statutory obligations.”
The Board Chairman reaffirmed the Fund’s commitment to Nigerian workers, describing the meeting as a demonstration of its fiduciary duty to the President, the Labour Minister, and the Nigerian workforce.
Conclusion
The NSITF has positioned the Employees Compensation Scheme as a cornerstone of industrial harmony in Nigeria. Employers are reminded that salaries alone cannot guarantee workers’ future security, and compliance with ECS is essential.
At the same time, the ambiguity in the Finance Act 2021 presents a looming threat to workers’ social safety net, making it crucial for employers, policymakers, and labour unions to rally in defense of the scheme.
