NLNG Train 7 Workers Protest Alleged Illegal Tax Deductions

Staff working on the multi-billion-dollar Nigeria Liquefied Natural Gas (NLNG) Train 7 project have embarked on a protest in Bonny, Rivers State, over alleged irregular tax deductions. The action has brought into focus critical questions about workers’ rights, corporate responsibility, and the integrity of labor unions in Nigeria’s oil and gas sector. The protest, which began with fitters and welders before spreading to include junior staff under Daewoo Contractors, highlights a serious labor dispute on a project of immense national importance.

According to findings, each worker has allegedly been subjected to monthly deductions of approximately N150,000 for tax clearance over the past two years. The aggrieved staff claim that despite these significant deductions, the company has not issued them their official Tax Identification Numbers (TINs). A further audit reportedly uncovered a grave anomaly: despite the deductions being made, the monies were never remitted to the federal government. As a result, the workers are demanding the immediate release of their TINs and a full refund of the monies illegally deducted from their salaries over the last two years. Under Nigerian law, specifically the Pay-As-You-Earn (PAYE) system, an employer is legally obligated to deduct taxes and remit them to the relevant state internal revenue service. Failure to do so is a serious offense punishable by law and can lead to hefty penalties and even prosecution. The workers’ demand is therefore rooted in their legal rights as taxpayers.

One of the protesting workers, a pipe welder who spoke to the media on condition of anonymity, explained that the protest commenced on Monday after numerous unanswered requests for clarification from the company. He noted that although the company had at one point asked the workers to appoint representatives for a dialogue, the resolutions reached during those discussions were never implemented, leading to the current industrial action. The situation is further complicated by serious allegations leveled against their own union. The workers have accused their union leadership of complicity, claiming that the leaders had been aware of the illegal deductions for two years but chose to remain silent, allegedly because they were benefiting from the illegal taxation. This accusation of a compromised union leadership adds a layer of betrayal to the workers’ struggle, leaving them feeling abandoned by the very body meant to protect their interests.

The NLNG Train 7 project is a massive, multi-billion-dollar investment that is vital to the Nigerian economy. It is expected to inject over $10 billion into the country’s oil and gas industry, create more than 12,000 direct jobs, and increase Nigeria’s LNG production capacity by a significant 35%. The project is a joint venture between NLNG and the SCD JV Consortium (Saipem, Chiyoda, and Daewoo). A protest of this nature has the potential to cause significant delays and tarnish the image of a project that is of such national importance. The dispute highlights the need for greater transparency and accountability in labor relations, particularly in the oil and gas sector. It also serves as a cautionary tale for workers and a reminder of the importance of vigilance in ensuring their rights are not trampled upon.

The alleged illegal tax deductions are part of a broader, more systemic issue of payroll fraud and non-compliance in the country, where some employers fail to remit statutory deductions like taxes, pensions, and housing funds to the appropriate government agencies. The workers’ decision to protest is their constitutional right and is a clear indication that they will not tolerate what they perceive as exploitation. The situation is a major test for the contractors, the union, and the relevant government bodies to address the workers’ grievances transparently and swiftly to prevent the dispute from escalating further and affecting a project so critical to Nigeria’s economic future.