By Muhammad Mamman
The Nigeria Labour Congress (NLC) has accused the Federal Ministry of Finance of unlawfully deducting 40 per cent of contributions to the Employees’ Compensation Scheme (ECS), branding the action a violation of labour laws and a threat to workers’ welfare. In a formal letter dated 22 July 2025, addressed to the Managing Director and Chief Executive of the Nigeria Social Insurance Trust Fund (NSITF), NLC President Joe Ajaero demanded the immediate refund of the deducted funds, with interest, within a two-week deadline.
The NLC’s letter highlighted that the deduction, allegedly made under the pretext of removing the fund’s operating surplus in accordance with the Fiscal Responsibility and Finance Act 2020, contravenes Sections 33 and 39(1) of the Employees’ Compensation Act (ECA) 2010. These provisions mandate employers to contribute 1 per cent of their monthly payroll to the ECS to mitigate the impact of workplace injuries, explicitly prohibiting deductions from employees’ wages. The NLC described the Ministry’s action as “strange and extremely irregular,” noting that the NSITF, a tripartite agency, holds these funds in trust for workers’ benefit and is neither treasury-funded nor designated as a government revenue agency.
The ECS, established under the ECA 2010, operates as a ‘No Fault Scheme’ to provide compensation for workplace injuries, occupational accidents, or fatalities, ensuring robust protection for Nigerian workers. The NLC emphasised that the fund’s contributions are solely for workers’ welfare, with no legal or practical basis for the Ministry’s deduction.
The Congress has called for urgent action, demanding that the NSITF ensure the prompt return of the deducted 40 per cent, alongside reasonable interest, within two weeks of receiving the letter. The NLC’s stance underscores its commitment to safeguarding workers’ rights and upholding the integrity of the ECS.
Failure to comply, the NLC warned, could escalate tensions, as the Congress seeks accountability and adherence to the law. The matter remains under close scrutiny, with stakeholders awaiting the Federal Government’s response.
