At a glance

• Employment bonds are used in Nigeria’s employment space to protect employers’ investment in employee training.
• Nigerian courts uphold bonds that are reasonable, proportionate and voluntary but reject those that are punitive, excessive or restrictive enough to amount to forced labour.
• Key factors that determine enforceability of employment bonds include the actual cost of training, reasonable duration of employment (typically one to three years) and adherence to constitutional and international labour standards.
• Employers risk invalidation of employment bonds when the terms are unclear, oppressive or where the employers fail to meet their own obligations.
• Properly structured bonds are legitimate but must be carefully balanced with employee rights.

Background

Employment bonds are contractual agreements requiring employees to remain with an employer for a defined period after receiving training or, alternatively, to repay the cost of that training if they leave prematurely. Their rise in Nigeria reflects the growing demand for specialised skills, particularly in aviation, oil and gas, and financial services, where employers incur significant costs in the development of their employees. While bonds serve as a safeguard for employers, they intersect with sensitive legal issues, including the constitutional prohibition against forced labour, contractual fairness, and public policy.

The National Industrial Court of Nigeria has played a pivotal role in clarifying...

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