The employer is somebody or an institution that hires or provides work for another person called, employee for an agreed remuneration. The employer can hire anybody he pleases and relieve any of his employees of work if he misbehaves contrary to the laid down rules and regulations.


Duties of the Employer

  1. Payment of Remuneration to the Employee: The employer has a duty to pay his employee’s remuneration according to the terms of the contract.
  2. Provision of Safe Place for Work: He must provide a very safe place to his workers in order to carry out duties assigned to them without fear of injury.
  3. Provision of Necessary Tools and Equipment: He must provide all necessary tools and equipment for proper execution of his employee’s duties.
  4. He must Indemnify His Employee: The employer must indemnify his employee against any loss arising from the proper performance of his duties.
  5. He must Accept Responsibility for Personal Injury: The employer must accept responsibility for injury sustained by an employee during the course of carrying out his obligations.
  6. Provision of Training Facilities: The employer must provide training facilities as well as incentives to motivate his employee in order to increase productivity.
  7. Job Security: The employer must provide adequate job security. He must assure the employee that their employment is permanent.


Rights of the Employer

  1. Right to Use Invention of Employee: He has every right to make use of anything invented by the employee with his facilities and more especially during the working period.
  2. Right to Fix Remuneration: The employer has right to fix wages and salaries of his employee.
  3. Right to Relieve Employee of His Job: He can terminate the appointment of his employee, after giving due notice.
  4. Right to Employ or Hire Anybody: The employer has the right to hire whoever he pleases without being questioned.



The employee is someone who agrees to perform services to an employer in exchange for the payment of an agreed remuneration. The employee works for another person called the employer for an agreed sum of money and is accountable to his employer.


Duties of the Employee

  1. Performance of Duties According to Terms: The employee must perform all his duties and obligations according to the terms stated in the contract.
  2. Keeps the Secret of His Employer: He must not under any circumstance reveal confidential and secret information regarding the employer’s trade.
  3. Obeys Orders and Instructions: He must obey orders and instructions from his employer in respect of the work assigned to him.
  4. Must Serve Faithfully and Honestly: The employee must serve faithfully and honestly. His own interest must not conflict with the interest of his employer.
  5. Exercises Good Faith: The employee has a duty to act in good faith when discharging his duties for the benefit of the employer.
  6. Must be Accountable to His Employer: He must be accountable to his employer for the discharge of his responsibilities; proper account must be kept.
  7. Must Not Delegate His Duties: He is not to delegate the performance of his duties to another person without the authority of the employer.
  8. No Secret Profit or Acceptance of Bribe: The employee is under obligation not to accept bribe and not to use his employer’s equipment for secret profit.


Rights of the Employee

  1. Right to Receive Compensation for Loss: The employee has a right to receive compensation for liability or loss suffered in the course of business.
  2. Right to Accept or Reject Offer: He has the right to either reject or accept offer of employment.
  3. Right to Receive the Agreed Remuneration: He must receive his agreed remuneration. He must be paid wages or salaries for performing his duties.
  4. Right of Annual Leave: He must be given annual leave to rest once in a year.



The government lays down certain rules and regulations that will help to control and regulate business activities in a country. There is need to ensure uniformity in commercial policies and to regulate business activities so as to encourage smooth operations because of the inherent intricacies and complexities in the commercial world.


Methods of Government Regulation of Business

There are various ways by which government regulates business. These include:

  1. Business Licence / Registration: Under the Company Act, all businesses must be registered either as sole trading, partnership, public company or cooperative. In Nigeria, it is mandatory for all business enterprises to be registered with the Corporate Affairs Commission (CAC) before commencing operation. A certificate of incorporation will be issued to any business incorporated. Such organisation must abide by the provisions of the Company and Allied Matters Act.
  2. Patent Rights: This is an exclusive right granted by government to a person to make use or sell an invention for a certain period of years. This gives the owner some degree of monopoly of the invention. Nobody can make use of such invention without permission from the right owner. This is to encourage innovation and allow the inventor to recoup his research cost, e.g. right given to Henry Ford to produce Ford automobiles.
  3. Trade Marks: Trade mark is a distinctive symbol, special mark or design that is given to a producer to distinguish or identify its products from other products. It is a form of product differentiation. Trade mark is a legal term covering words and symbols which can be registered and protected. Once a producer has registered a trade mark, any infringement will attract the wrath of the law. Examples of trade marks are Jik, Parozone; all are different trade marks for cleaning or washing materials.
  4. Copyrights: This is an exclusive or sole right granted to writers of literary works (authors), musicians and artists to produce his work for a specified period of time. Another person cannot reproduce such work without a written permission from the copyright owner. Literary copyright will last for 50 years after the death of the author while musical right will only last for 50 years after its release.
  5. Approval of Business Location: Government can also control and regulate business by giving approval for the location of a business enterprise. Sometimes they do this by establishing industrial estates.
  6. Publication of Accounts: Public liability companies are mandated to publish their annual accounts for public consumption. This is to prevent fraudulent practice.
  7. Taxing Company’s Profit: Business can also be regulated by introducing tax on the profit of some business enterprises while poor companies may have their tax reduced through concession in order to encourage them.
  8. Use of Standard Weight and Measures: All business enterprises are mandated to use standard weights and measures for the product offered for sale, e.g. in soft drinks industry, there are 25cl, 30cl, 35cl etc measures.
  9. Ensure Production of Safe Goods: Another way is to ensure that goods offered for consumption are safe and of high quality.
  10. Regulation of Disposal of Waste: Businesses are also mandated to introduce measures to dispose their waste in such a way that there will be no environmental pollution.
  11. Regulation Over Ownership of Business: Ownership of business can also be regulated through some policies like indigenisation, commercialisation and privatisation.


Reasons for Government Regulation of Business

  1. To ensure uniformity in commercial and economic policies.
  2. To ensure industrial harmony between the employers and workers.
  3. To ensure provision of quality products.
  4. To ensure regular supply of essential goods and services.
  5. To ensure the development of the economy.
  6. To raise revenue through tax imposition for certain purposes, e.g. in Nigeria, companies are paying educational tax, value added tax (VAT), etc.
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