Reps move to prohibit banks from hiring casual, contract staff

A bill seeking to regulate the employment of staff by Nigerian banks has passed second reading at the house of representatives. 

The draft law, sponsored by Fuad Laguda, a member of the All Progressives Congress (APC) representing Surulere I federal constituency of Lagos, aims to amend the Banks and Other Financial Institutions Act 2020 to “prohibit, criminalise and penalise” the employment of casual or contract staff by banks.

Leading the debate on the bill during Thursday’s plenary, Laguda said the objective of the proposed law is to “totally mitigate” employment in banks to remove “exploitative and oppressive treatments of millions” of Nigerians who work as casual or contract workers in the financial sector.

He said the Labour Act 2004, and the Employees’ Compensation Act (ECA) 2010 do not provide for the welfare of casual and contract staff.

Citing a 2023 report by the Chartered Institute of Bankers of Nigeria (CIBN), the lawmaker said banks use casual and contract workers to reduce costs for operations such as pensions, minimum wages, health insurance, promotions, bonuses, study grants, and severance packages.

Laguda said casual and contract workers are about 65 percent of the entire workforce in banks, adding that the bill seeks equitable treatment for all Nigerian workers.

The legislator said the proposed law aims to curb the “heinous practices” of banks breaching the provisions of section 7(1) of the Labour Act 2004, which states that an employee should not be employed for more than three months without the formal recognition of such employment.

“I urge my colleagues to support this bill because it corresponds with the viewpoints of the governor of the Central Bank of Nigeria (CBN), Mr Olayemi Cardoso, who said casual and contract staff in Nigerian Banks are exposed to poor working conditions,” Laguda told the parliament.

He added that banks usually employ casual and contract staff to avoid entering into any legal and contractual obligations with them, and are subject to systemic inequalities, emotional abuses, and mental health challenges.

Lawmakers unanimously voted in support of the bill when Benjamin Kalu, the deputy speaker, called for a voice vote.