In February 2023, President Muhammadu Buhari (GCFR), signed the Business Facilitation (Miscellaneous Provisions) Act, 2023 into law. The Act, which is also known as the “Omnibus Act” is aimed at improving the ease of business in Nigeria, and to further create an enabling environment for micro, small and medium-sized enterprises (MSMEs) to thrive in the country.

This Business Facilitation Act amended various clauses in about 21 pieces of legislation. These amendments are intended to eliminate bottlenecks that have hitherto impeded business operations in the country.

This piece will focus on two (2) of the amendments which have direct impact on personnel cost and employee benefits:

1. National Housing Fund (NHF) Act: the NHF Act had hitherto made contributions to the National Housing Fund mandatory for all Nigerian workers in both the public and private sectors earning at least N3,000.00 (Three Thousand Naira Only) per month. The Act stipulated a monthly contribution of 2.5% of basic salaries to the Fund. The Omnibus Act has however made the following amendments to the NHF Act:

  • The minimum monthly earnings required for eligible contributors has been increased to match the current national minimum wage of N30,000.00.
  • Participation of private sector employees in the scheme has now been made optional. Whereas public sector employees are required to continue contributing to the Fund.
  • The contribution rate into the Fund has also been expanded from 2.5% of monthly basic salary to 2.5% of monthly income. The Act however does not specify what constitutes the monthly “income”. This is an area that still requires clarification. For example, the Pension Reform Act defines “emoluments” as the minimum of basic, transport and housing allowances. Such definition would be required to eliminate ambiguity in the implementation of this portion of the Omnibus Act. Curiously, the wording of the Act seems to make it mandatory for self-employed persons to also contribute to the Fund. It is unlikely that this can be enforced in practice.

2. The Industrial Training Fund (ITF) Act: the ITF Act had hitherto required organisations employing a minimum of five (5) employees, and with annual turnover of at least N50m to contribute 1% of their annual payroll to the Industrial Training Fund. Contributing organisations however have the opportunity to receive 50% of their annual contributions as reimbursements, upon fulfilling certain criteria defined by the Fund.

The Omnibus Act has now raised the required number of employees to at least 25. Consequently, organisations employing less than 25 persons are now exempted from contributing to the Fund. Also exempted by the Act are employers operating within a Free Trade Zone in the country.

In conclusion, while the amendments introduced by the Omnibus Act are well-intentioned, implementation challenges may arise due to the ambiguity of some clauses.

There is therefore an urgent need for the Federal Mortgage Bank of Nigeria (operators of the NHF) and the Industrial Training Fund to clarify the following:


  • What constitutes “monthly income”?
  • Is contribution mandatory for self-employed persons?
  • When can private sector employees who no longer wish to continue contributing to the Fund access their contributions. Can they apply for their refunds immediately or do they have to wait till retirement?


  • Is the exemption applicable to all companies below 25 staff or just new companies registering with the Fund?

The exclusion of organisations employing less than 25 persons from annual ITF levies will reduce cost of employment for such companies and clearly validates the objective of the Omnibus Act, which is to lessen the burden/ impediments associated with running businesses in the country.

While the NHF is laudable and a relatively affordable route to home ownership, bureaucratic bottlenecks have limited access to the Funds. Private sector employees such as those employed by the MSMEs operating in the country can now exercise the choice to remain in the scheme or withdraw after weighing their options.