The Nigeria Social Insurance Trust Fund (NSITF) has warned that widespread non-compliance, weak enforcement, and rising labour outsourcing practices are crippling the effective implementation of the Employees’ Compensation Scheme (ECS) in Nigeria’s oil and gas industry.
Speaking at the Labour and Contract Administrators of Nigeria (LACAN) Annual Labour Conference in Abuja, the NSITF General Manager for the Abuja Region, Mrs. Bridget Ashang, who represented the Managing Director, Mr. Oluwaseun Faleye, described the situation as “a paradox of high-profit operations and low compliance with worker protection laws.”
Ashang lamented that despite the clear provisions of the Employees’ Compensation Act (ECA) 2010, many companies in the oil and gas sector have failed to register their employees or remit contributions to the ECS, which protects workers against occupational injuries and diseases.
“The oil and gas sector operates in some of the most hazardous environments in the country,” she said. “Yet, our enforcement teams continue to uncover poor hazard reporting, recurring safety lapses, and widespread ignorance of the law among both employers and employees.”
Outsourcing, Casualisation Obscure Accountability
According to Ashang, the increasing trend of labour outsourcing and casualisation has made it difficult to determine who bears liability when workers sustain injuries.
“A worker may wear the logo of one multinational, be paid by another, and have his employment contract handled by a third party,” she explained. “When accidents occur, accountability becomes a game of hot potato, leaving injured workers stranded without compensation.”
She further disclosed that some high-revenue companies exploit complex joint venture structures and offshore contracting arrangements to evade registration and contributions to the Fund.
Weak Penalties, Limited Access Hinder Enforcement
Ashang identified weak penalties for default and difficult access to offshore sites as key enforcement challenges, adding that the low-compliance culture within the sector discourages adherence to statutory obligations.
To address these gaps, she revealed that the NSITF has digitalised registration and remittance processes, intensified inspections of employer records, and strengthened collaboration with the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Federal Ministry of Labour and Employment.
Other reforms include the establishment of a service delivery centre in Bonny, simplified claims processing, and increased stakeholder sensitisation to raise awareness of the ECS benefits and obligations.
Push for Stronger Legal Backing and Policy Reforms
The NSITF called for sweeping reforms to enhance compliance, including stiffer penalties for defaulters, integration of labour data across government agencies, and a policy requiring ECS compliance clearance as a condition for awarding or renewing oil and gas contracts.
“We must move beyond persuasion to enforcement,” Ashang stressed. “Protecting the Nigerian worker is not an option—it is a legal and moral duty.”
Industry observers say stricter implementation of the ECS could help close protection gaps for thousands of oil and gas workers who face daily risks without adequate safety nets, while boosting the credibility of Nigeria’s social insurance framework.
