INTRODUCTION

The Federal Government of Nigeria (FGN), on the 27th  of February, 2024 issued a directive to Companies with expatriate  employees to pay an annual Expatriate Employment Levy (“EEL”). This directive is aimed at reducing the reliance on imported labour and, ultimately, ensuring that expatriates are employed only when no Nigerian candidate possesses the requisite skills for the particular role under consideration.

In addition, the EEL aims to narrow the wage disparity and facilitate knowledge exchange and transfer between foreign and domestic labour forces. Additionally, it seeks to decrease the frequency with which Nigerian employers renew their expatriate quotas.

By implementing this levy, the FGN anticipates enhancing Foreign Direct Investment (FDI) and fostering a culture among employers to invest in and actively support the growth of their local workforce.

SCOPE

The EEL  applies to private sector employers of any industry or size who hire a non-citizen residing in the country for a period not less than 183 (One Hundred and Eighty-Three) days within a year. The Nigerian Immigration Service (NIS) is the body tasked with determining which expatriates are subject to the EEL, enforcing the payment of the levy, and utilising the data collected from the EEL to bolster measures aimed at national security.

Exceptions

The EEL exempts staff of diplomatic missions, government officials, and accredited international agencies working with the Federal Government of Nigeria.

COMPLIANCE

Employers must maintain an updated and accurate register of all their expatriate employees on the EEL portal.

Applicable Fees

Employers are obligated to remit the appropriate fees as determined by the NIS. The fees vary from one  employment cadre to the other.  Failure to comply with the remittance attracts a penalty which may include a jail term of up to 5 (five) years.

 Conclusion

The EEL represents a positive step forward, fostering development for Nigeria’s workforce and enhancing the value of local labour. Businesses are strongly encouraged to adhere to the guidelines outlined in the EEL handbook, reinforcing the importance of compliance and commitment to the objectives of the levy.

** We are available to assist with ensuring your compliance with this new directive of the Federal Government .