Are Company Directors Employees? An Analysis of the Status of Company Directors Under Nigerian Law

Abstract

The legal status of company directors under Nigerian law presents a doctrinal tension between company law, which conceptualizes directors as fiduciaries and organs of corporate governance, and employment law, which is designed to protect persons working under contracts of service. This tension becomes particularly acute where executive and managing directors seek to enforce employment rights following removal or termination. Nigerian courts, especially the National Industrial Court of Nigeria (NICN), have increasingly been required to resolve disputes arising from this overlap. Anchored on the dual capacity theory and the contractarian theory of employment, this paper examines the status of company directors as employees under Nigerian law, analyzing statutory provisions, appellate decisions, and recent NICN decisions. A comparative analysis with the United Kingdom and South Africa is undertaken to contextualize Nigerian jurisprudence. The paper argues that Nigerian law adopts a functional and fact-based approach: directors are not employees by virtue of their office, but may assume employee status where a distinct contract of employment exists and the indicia of employment are satisfied. It concludes that while the appellate courts have been consistent, the stance of the NICN on borderline cases may compound the issue. It suggests statutory reform to harmonize company law and labour law principles on the status of company directors in Nigeria.

Keywords: Contractarian; Dual Capacity; Director; Employee; Managing Director

DOI: 10.7176/JLPG/151-02

Publication date: March 28^th 2026