Daily Law Tips (Tip 418) by Onyekachi Umah, Esq., LLM. ACIArb(UK)
DEDUCTION OF INTERESTS, DISCOUNTS AND SIMILAR CHARGES FOR “SALARY ADVANCE” IS ILLEGAL.
It is illegal for an employer to deduct any interest, discount or similar charges because of any advance of wages (“Salary Advance”) from the salary/wages of a worker. Hence, “Salary Advance” must be free and not with charges/interest, it is not a loan.
Note that this applies to all workers, staff and employees or by whatever description or title in any public or private office/establishment in any part of Nigeria.
My authorities are sections 4(4), 91 and 92 of the Labour Act, 1971.
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