The precarious situation of contract staff in Nigeria’s financial sector has prompted calls for government intervention, particularly from the National Assembly. Anthony Abakpa, President of the National Union of Banks, Insurance, and Financial Institution Employees (NUBIFIE), has voiced serious concerns regarding the discriminatory treatment and exploitative practices faced by outsourced workers in banks, insurance companies, and other financial institutions. This disparity in treatment, he argues, violates the principles of decent work and undermines the Sustainable Development Goal 8, which aims to promote inclusive and productive employment for all. Abakpa advocates for a thorough review of the current system, even suggesting the abolition of contract staffing in the sector, highlighting the stark contrast between Nigerian practices and those of neighboring countries where outsourcing models appear more equitable.
The core of the issue lies in the significant gap in wages, benefits, and career progression opportunities between permanent staff and outsourced employees. While both groups contribute to the organizations’ overall performance, contract staff are often denied basic employment rights, including fair compensation, pension contributions, and pathways for professional growth. This practice effectively creates a two-tiered system within the financial sector, where outsourced workers are relegated to a lower status with limited prospects for advancement. Abakpa’s characterization of this system as “satanic” underscores the deep-seated inequities inherent in the current model and the urgent need for reform. He argues that these practices deprive Nigerian citizens of their fundamental right to decent work and a fair standard of living.
The exploitation of contract workers, Abakpa contends, stems from the unchecked power of financial institutions to dictate employment terms and conditions for outsourced personnel. These institutions leverage the vulnerability of contract staff, who are often hired through third-party agencies, to minimize labor costs and maximize profits. This strategy, while financially beneficial for the organizations, perpetuates a cycle of precarious employment and undermines the principles of fair labor practices. NUBIFIE, along with other labor unions, has repeatedly challenged these practices, demanding equal treatment and collective bargaining rights for all workers in the financial sector, irrespective of their employment status.
Olusoji Oluwole, National President of the Association of Senior Staff of Banks, Insurance and Financial Institutions (ASSBIFI), acknowledges the inconsistencies in staff welfare across different organizations, noting that reviews and negotiations frequently occur based on varying parameters. Regarding outsourced staff, he highlights ongoing efforts by unions to address their representation challenges, given their employment through third-party companies. Oluwole points to guidelines issued by the former Minister of Labor and ongoing initiatives to absorb outsourced employees into permanent positions within some organizations, signifying some progress in addressing the issue. However, the widespread adoption of such policies remains a challenge.
The prevalence of contract staffing within the Nigerian banking sector is underscored by data from the National Bureau of Statistics. As of September 2020, a staggering 42% of bank employees were on contract, demonstrating the extent to which this practice has become embedded in the industry. This over-reliance on contract labor highlights the cost-cutting strategies employed by banks, which often prioritize short-term financial gains over the long-term well-being of their workforce. By outsourcing a substantial portion of their workforce, banks circumvent the obligation to provide full benefits and compensation, effectively shifting the burden onto individual workers and perpetuating a system of unequal treatment.
The situation of contract staff in Nigeria’s financial sector calls for a comprehensive reevaluation of existing labor practices. The concerns raised by Abakpa and Oluwole emphasize the need for a more robust regulatory framework that protects the rights of all workers, regardless of their employment status. Government intervention, including legislative action and stricter enforcement of labor laws, is crucial to addressing the systemic inequalities and ensuring decent work for all Nigerians employed in the financial sector. Moreover, a collaborative approach involving stakeholders such as unions, employers, and government agencies is necessary to create a more sustainable and equitable employment landscape. This includes promoting fairer compensation practices, providing opportunities for career progression, and ensuring access to essential benefits for all workers, thus upholding the principles of fair labor practices and contributing to a more inclusive and just society.
