Employer of Record in Nigeria: what one employee really costs
Nigeria, Africa. One software engineer at $20,000 gross per year, priced through 12 providers with a published fee, on the European Commission's September 2026 exchange rate. Change the salary and headcount below.
- Employer on-cost
- +12.0%
- statutory charges on top of gross
- All-in per month
- $2,066 – $2,566
- salary + charges + published fee, cheapest to dearest listed provider
- Onboarding through an EOR
- 2 days
- per Deel - Hire employees in Nigeria ('your next hire could start in as little as 2 days with Deel')
Hiring one software engineer in Nigeria at $20,000 gross a year costs about $200 a month in statutory employer charges (+12.0%), plus an EOR fee of $199 to $699 per month depending on the provider: $2,066 to $2,566 all-in, before deposits, FX margins and add-ons. Prices checked 2–24 Sept 2026.
Disclosure Some provider links on this page are affiliate links: if you become a customer after clicking, the provider may pay us a referral fee. It never changes the price you pay, and it never changes the numbers on this page, which come from official sources and are dated. How we are paid
Cost engine · preset to Nigeria
Price your own hire, line by line.
≈ NGN 26,932,062 gross / year · NGN at the European Commission monthly rate for September 2026
| Per employee | Rate | Per month |
|---|---|---|
| Gross salary | $1,667 | |
| Contributory Pension Scheme, employer share | 10% | $167 |
| Employees' Compensation Fund (NSITF), employer contribution | 1% | $17 |
| Industrial Training Fund levy | 1% | $17 |
| Employer on-cost | +12.0% | $200 |
| Cost of employment, before EOR fee | $1,867 |
$2,066/ month · 1 employee
- Fee / mo
- from $199
- Per year
- $24,788
- Fee share
- 9.6%
Checked 2 Sept 2026
Get a RemoFirst quote$2,366/ month · 1 employee
- Fee / mo
- from $499
- Per year
- $28,388
- Fee share
- 21.1%
Checked 2 Sept 2026
Get a Papaya quote$2,466/ month · 1 employee
- Fee / mo
- from $599
- Per year
- $29,588
- Fee share
- 24.3%
Checked 2 Sept 2026
Get a Deel quoteEmployer charges from official sources; provider fees are list prices on the dates shown; deposits, FX margins and add-ons are not included. Not legal or tax advice. Methodology
14 providers, one scenario, all-in totals.
| Provider | EOR fee / employee / mo | All-in / mo, 1 hire | Deposit | Countries | Checked | Quote |
|---|---|---|---|---|---|---|
| RemoFirst EOR in 185+ countries from $199 per employee per month, no annual contract. | from $199 | $2,066 | Not stated on the pricing page | 185+ | 2 Sept 2026 | Get a quote from RemoFirst· $2,066/mo |
| Rivermate EOR in 180+ countries from $319 to $639 per employee per month. | from $319 | $2,186 | Not stated on the pricing page | 180+ | 2 Sept 2026 | Get a quote from Rivermate· $2,186/mo |
| Pebl Velocity Global, renamed Pebl in 2026. Prints $399 per employee per month. | from $399 | $2,266 | Not stated on the pricing page | 185+ | 22 Sept 2026 | Get a quote from Pebl· $2,266/mo |
| Playroll EOR in 180+ countries from $399 per employee per month; deposit of one month's salary. | from $399 | $2,266 | Fully refundable security deposit equivalent to one month's salary when onboarding an employee (pricing page). | 180+ | 2 Sept 2026 | Get a quote from Playroll· $2,266/mo |
| Multiplier EOR from $459 (annual) or $499 (monthly) per employee, plus mandated add-ons. | from $499 $459 billed annually | $2,366 | Refundable security deposit required per employee by the EOR terms (effective 1 June 2026), sized by Multiplier; not on the pricing page. | 150+ | 24 Sept 2026 | Get a quote from Multiplier· $2,366/mo |
| Papaya Global EOR starting from $499 per employee per month, quote-based, 160+ countries. | from $499 | $2,366 | Not stated for EOR on the pricing page (the contractor block states 'No deposit required'). | 160+ | 2 Sept 2026 | Get a quote from Papaya Global· $2,366/mo |
| Borderless AI EOR at $579 per employee per month, no deposit or pre-funding, 170+ countries. | $579 | $2,446 | No deposit: 'No upfront deposits or pre-funding required' (pricing page). | 170+ | 24 Sept 2026 | Get a quote from Borderless AI· $2,446/mo |
| Atlas HXM EOR from $599 through its own entities, plus an Agent of Record at $199. | from $599 | $2,466 | Not stated on the pricing page | 160+ | 21 Sept 2026 | Get a quote from Atlas HXM· $2,466/mo |
| Deel EOR in 130+ countries, starting at $599 per employee per month. | from $599 | $2,466 | Not stated on the pricing page | 130+ | 2 Sept 2026 | Get a quote from Deel· $2,466/mo |
| G-P EOR in 180+ countries from $599, with no minimum contract length. | from $599 | $2,466 | Not stated on the pricing page | 180+ | 24 Sept 2026 | Get a quote from G-P· $2,466/mo |
| Oyster EOR in 120+ countries at USD 699 per employee per month; refundable deposit. | $699 | $2,566 | Refundable deposit required for EOR team members 'to initiate the engagement and to ensure on-time payments' (pricing FAQ). | 120+ | 24 Sept 2026 | Get a quote from Oyster· $2,566/mo |
| Remote EOR in 90+ countries at $699 per employee per month, no deposit. | $699 | $2,566 | No deposit: 'We collect reserve payments in rare, high risk circumstances' (pricing FAQ). | 90+ | 2 Sept 2026 | Get a quote from Remote· $2,566/mo |
| Rippling EOR bundled with the Rippling platform; custom quote only. | Quote only | — | Not stated on the pricing page | — | 24 Sept 2026 | Get a quote from Rippling |
| Safeguard Global EOR sold alongside entity setup and payroll; no price published. | Quote only | — | Not stated | 187+ | 21 Sept 2026 | Get a quote from Safeguard Global |
Same salary and statutory charges in every row; only the fee segment changes.
What Nigeria adds on top of the salary, and where each rate comes from.
Rates apply to the base named in each line; capped lines stop growing above the ceiling. Engine assumptions: Pension contribution base as a share of gross = 1.
| Line | Employer rate | Base & ceiling | Source |
|---|---|---|---|
| Contributory Pension Scheme, employer shareEmployers with three or more employees, on the employee's monthly emoluments, with no ceiling | 10% | Basic wage Section 4(1) of the Pension Reform Act 2014 sets the rates 'relating to his monthly emoluments' at 'a minimum of ten per cent by the employer' and a minimum of eight per cent by the employee. Two words in that sentence do work. 'Minimum' means an employer may agree to more, and section 4(4) lets one carry the whole scheme at no less than 20% of monthly emoluments. 'Monthly emoluments' is defined in the Act as total emoluments under the contract, but never less than basic salary plus housing and transport allowances - a floor on the base rather than a cap. There is no earnings ceiling, so this line is a straight percentage at every salary. | National Pension Commission (PenCom)2026-09-21 |
| Employees' Compensation Fund (NSITF), employer contributionEvery employer, on total monthly payroll, with no ceiling | 1% | Gross salary Section 33(1) of the Employees' Compensation Act 2010 obliges an employer to pay into the Employees' Compensation Fund managed by the Nigeria Social Insurance Trust Fund. The National Industrial Court of Nigeria states the obligation in those terms in a judgment it published on 7 May 2025: an employer 'is obligated to make a minimum monthly contribution of 1% of its total monthly payroll into the Employees' Compensation Fund managed by the Nigeria Social Insurance Trust Fund Management Board'. It is charged on payroll rather than on a capped insurable wage, and it is the Nigerian equivalent of the work-injury cover that many countries buy from a private insurer. | National Industrial Court of Nigeria2026-09-21 |
| Industrial Training Fund levyEmployers with five or more employees, or fewer than five but with annual turnover of NGN 50m or above | 1% | Gross salary The Industrial Training Fund (Amendment) Act 2011 substitutes a new section 6(1): 'Every employer having either 5 or more employees in his establishment, or having less than 5 employees but with a turnover of N50m and above per annum, shall, in respect of each calendar year and or the prescribed date, contribute to the Fund one per centum of his total annual payroll.' The threshold is why this line is sometimes said not to apply to a first hire. Under an employer of record it always applies: the employer of record is the employer, and it is well past both tests. The Act also lets the Ministry vary the rate by order published in the Gazette. | Industrial Training Fund2026-09-21 |
| Group life insurance of three times annual emoluments - premium, not a percentage charge not in total | — | Carried at zero because it is an insurance premium, not a rate fixed by law. Section 4(5) of the Pension Reform Act 2014 requires that 'every employer shall maintain a Group Life Insurance Policy in favour of each employee for a minimum of three times the annual total emolument of the employee'. The law fixes the cover, the insurer fixes the price, so what appears on an invoice is a commercial number: Deel publishes 1.8% of salary for Nigeria. On a USD 20,000 salary that single line would be nearly as large as the NSITF and ITF levies combined, 1.8% against 2%, which is why it is worth asking a provider to quote it separately rather than reading it as part of the statutory total. | Deel2026-09-21 |
| National Housing Fund, 2.5% - deducted from the employee not in total | — | Carried at zero because the private-sector National Housing Fund contribution is a deduction from the employee's monthly income that the employer withholds and remits, with no matching employer share. Deel lists a National Housing Development Fund among Nigerian benefits without putting a percentage against it in the employer cost, which is consistent: the money comes out of pay. | Deel2026-09-21 |
| Thirteenth month pay - not required by Nigerian law not in total | — | Carried at zero because the Labour Act contains no thirteenth month or annual bonus obligation. Bonuses are contractual, and in practice a Nigerian offer that competes for software engineers usually carries one by contract rather than by law. | Federal Ministry of Labour and Employment (NELEX)2026-09-21 |
| Employer on-cost at $20,000 | +12.0% | $2,400 a year, $200 a month |
EOR or your own entity
Fees scale with headcount. An entity does not.
Nigeria prices cleanly and then hides its cost in two places. The clean part: 10% pension, 1% to the Employees' Compensation Fund and 1% to the Industrial Training Fund, none of them capped, which means the employer on-cost is the same percentage at USD 20,000 as at USD 100,000 - no ceiling flattens the curve the way Kenya's KES 108,000 NSSF limit or Morocco's MAD 6,000 CNSS ceiling does. The first hidden part is the pension base. The Act charges 'monthly emoluments' with a floor of basic plus housing and transport allowances, so a package paid as one salary is charged in full while a package split into allowances is charged on the narrower base. That single structural choice moves the pension line by a third or more, and it is a contract drafting question rather than a tax question. The second is the group life policy: three times annual emoluments is mandatory under section 4(5), the premium is commercial, and at the rate Deel publishes, 1.8% of salary, it is almost as large as the two levies together. For an entity-versus-EOR comparison, note that the ITF levy applies to employers with five or more employees or NGN 50m of turnover - a threshold a small local entity might sit below for a while, and one that an employer of record clears by definition.
Fees grow with every hire; the charges line is owed under an entity too.
| Headcount | RemoFirst fees / yr | Borderless AI fees / yr | Statutory charges / yr |
|---|---|---|---|
| 1 | $2,388 | $6,948 | $2,400 |
| 3 | $7,164 | $20,844 | $7,200 |
| 5 | $11,940 | $34,740 | $12,000 |
| 10 | $23,880 | $69,480 | $24,000 |
| 20 | $47,760 | $138,960 | $48,000 |
Statutory charges are owed either way; the provider fee is the only line an entity removes, against the cost of incorporating and running local payroll.
Employment terms that move the cost
- Paid leave
- 6 days
- Public holidays
- not recorded
- 13th month
- Not mandatory
- Probation
- no statutory maximum
- Notice
- By length of service, under section 11(2) of the Labour Act: one day where the contract has run three months or less, one week between three months and two years, two weeks between two and five years, and one month at five years or more. Notice of a week or more must be in writing. The statute is a floor - contracts for senior staff commonly provide one to three months - and a Nigerian hire of under two years' standing can be released on a week.
- Reviewed
- 2026-09-21
Get a quote for Nigeria.
The lowest published total here, next to the two providers searched for most often (the rule). Totals for 1 hire at $20,000. Ask each provider about deposits, FX margins and mandatory add-ons for Nigeria: those are the lines that move.
Disclosure Some provider links are affiliate links; they never change the numbers on this page. Details
Questions people ask before booking a demo
- How much does an employer of record cost in Nigeria?
- On a USD 20,000 salary the gross is about $1,667 a month and statutory employer charges add about $200 when the whole salary is the pension base, so payroll lands near $1,867 before the provider fee. Add the fee: about $2,066 a month with Remofirst at $199, about $2,466 with Deel at $599. Ask separately for the group life premium, which is mandatory and priced by the insurer.
- What is the employer cost in Nigeria as a percentage of salary?
- 12% of pay when the full salary is the pension base: 10% pension, 1% NSITF and 1% ITF, none of them capped, so the percentage does not fall as salary rises. If the contract splits pay into basic, housing and transport allowances, the pension base narrows towards the statutory floor and the total falls below 12% - the two levies stay on total payroll regardless.
- Is the Nigerian pension charged on basic salary or on the whole package?
- On 'monthly emoluments' as defined in the contract of employment, which the Pension Reform Act 2014 says 'shall not be less than a total sum of basic salary, housing allowance and transport allowance'. That is a floor on the base, so a contract that defines emoluments as the whole salary is charged on the whole salary. This is the single largest lever on Nigerian employer cost, and it is set when the contract is drafted.
- Does the Industrial Training Fund levy apply to one employee?
- Under an employer of record, yes. The Amendment Act 2011 applies it to an employer with five or more employees, or fewer than five with turnover of NGN 50m or above - and the employer of record is the employer of your hire, well past both tests. A small Nigerian entity of your own might sit below the threshold for a time, which is one of the few places where an entity is genuinely cheaper per head.
- What leave and notice apply in Nigeria?
- Section 18 of the Labour Act gives at least six working days of paid holiday after twelve months of continuous service - a statutory minimum well below the market, so competitive offers write in more. Notice under section 11 runs from one day under three months of service to one month at five years or more. There is no statutory thirteenth month and no statutory cap on a probationary period.