The Director-General of the Nigeria Employers’ Consultative Association (NECA), Adewale-Smatt Oyerinde, in an interview with GLORIA NWAFOR, discusses how back-end negotiation with organised labour on the next national minimum wage before the committee-level discussion will help to prevent industrial crisis and other emerging labour issues.

The world of work has changed more in the past five years. Employees’ expectations have increased far beyond simple perks or hybrid work policies. What are your expectations for shaping the future of work?

The future of work is here, shaped by innovations that are transforming the workplace in the wake of the necessary disruption of COVID. Without COVID, it would probably have been difficult for us to secure the jobs we have now, and it would have been hard to follow this trajectory. But COVID forced us to re-evaluate how we have been doing things and working, and that shock is driving greater innovation.

The economic dynamics, as we see them now, are making individuals’ needs change in proportion. Before now, it was basically about economic needs, but we have seen that for many employees, what keeps them going has gone beyond the Naira and kobo, which is also very important. We have come to see the context of mental health, flexibility in engagement, and meaning.

People find meaning in work, not necessarily the quantum of work, while the quantum of cash is also very important because, in the long run, we are all working so that we can make a reasonable income. But progressively, workers’ expectations are changing, and employers’ expectations largely remain focused on sustainability and competitiveness across different models. Sustainability in the evolution of the kind of models and structures you run, and competitiveness in the context of being able to meet your obligations, not only to the government but even to the workers whose expectations are changing.

The new thrust of competition has been on sustainability and on how to care for the environment beyond the ordinary. So those are changing, and I must confirm that employers are responding. We responded initially to the COVID shock, and we are currently responding to all those issues of mental health and flexibility, with people actually deriving meaning from work. Within the context of the limitations of employers, I think employers, maybe not all, are also evolving so that they can meet the expectations of the current realities, which concern the future of work.

With the ongoing tensions in the Middle East and their impact on the global oil market, which has driven up domestic oil prices and worsened inflationary pressure across the globe, what reforms do you suggest the government implement to support businesses and households?

The global economic quagmire we find ourselves in as a result of the war in the Middle East is both an opportunity and a threat. For countries with high stability, higher crude prices mean more cash. But for countries that are still experiencing some level of instability, even in production, it is a double-edged sword. Take a country like Nigeria: we have just about 2,000 barrels per day allocated by the Organisation of the Petroleum Exporting Countries (OPEC), but we are still struggling to meet the production quota. So, what you will have made by selling your quota, if your budget assumption for crude is $100, by the time crude is $120. You are making an extra $20 per barrel sold, which is quite a lot of money if you are maximising your potential.

But if you are not maximising your potential in production, you are already short-changing yourself. Now, because you cannot meet your quota, you cannot make the kind of money that you should make. The extra you are making is just being used to balance your shortfall. We are in a peculiar situation where we have sold our crude ahead of time. For many of us, our past administrations have cooked our breakfast and dinner. We ate it. Now in the morning, we are all expecting breakfast. That is the pain that many of us are feeling. However, the government must take steps to mitigate the challenges, as energy is fundamental to everything.

It affects your transportation, logistics, production, and almost everything else. When costs rise proportionally, they reduce the average individual’s purchasing power, affecting flight, logistics, shipping, and freight costs. This is because everything feeds back into the cost of production, which in turn pushes up the prices of goods and services, and the burden ultimately goes back to the consumer, unfortunately and all of us, including households and workers, are part of it. Short-term mitigation strategies, though not specific to every country, require each country to decide what works best for them. Some countries have stepped up investment in renewable energy and Compressed Natural Gas (CNG) buses to mitigate transport challenges, and we are in an environment where, when prices go up, they hardly come down again, which is unfortunate for us. For governments to think through, they must address the critical issues of how to support the most vulnerable among us. Unfortunately, we are also facing multidimensional issues.

Meanwhile, as we work to raise money to address the needs of the most vulnerable, we are increasingly concerned that you must find a way to continue supporting our military and the police in the field, no matter how tight your budget is. As efforts are made to protect the pipelines, some people are also coming up with innovative ways to continue disrupting and vandalising them. There are many contradictions that we just have to deal with. As many other governments have done to mitigate the challenge, ours can create state-owned commercial buses at specific times, such as 6 am to 8 am, to pick up people going to work.

So, let us have state-owned buses and trains, and let them, during that period, take people who are going to work for free. Then, in the evening, when coming back from work, it should be free within a set window. Then, after that, at that window, they go back to the commercial, just as a way of supporting. We just have to come up with some innovative ways to address these issues, because they cut across both. As workers are crying, the woman in the market is crying too.

Whatever you give the worker as support, the woman in the market is waiting to collect it, and the next person is also waiting to collect it. So, it is a rigmarole, but we just have to find a way to mitigate pressure.

What role should employers play in raising wages without fuelling inflation or causing job losses? And how committed is NECA to decent wages and jobs for Nigerian workers, given the challenges many businesses face?

We are committed to decent wages, not just the minimum wage. Many organisations in the private sector are already paying above the N70,000 minimum wage. We have lived up to our responsibility to ensure that, as much as possible, no worker is left in drudgery. We make sure that no worker goes home with an amount that cannot take them home. We advocate responsible business conduct, in which employers are responsible not only to the government but especially to their workers, by providing a decent environment and decent work.

We will continue to advocate for decent work, a decent environment, and a decent life for all. We remain within the realm of the living wage, as the conversation at the living wage level is still being sorted out at the International Labour Organisation (ILO), because the International Organisation of Employers (IOE) is also part of the conversation on the living wage. So, we are open to collaborating with our colleagues in organised labour, ensuring that neither employer nor employee is treated like a commodity, as the ILO has said.

As a member of the tripartite, what is the current situation and the private sector’s position on the next minimum wage?
On the national minimum wage, we will return to the negotiation table by next year. Employers are open to discussing this so that the issues that bedevilled us before can be resolved. We hope organised labour will find it necessary for us to hold pre-meetings and pre-engagement sessions before we reach the committee level, as we identified gaps in the last meeting. We all went there, and that was where the negotiation started. We begin the negotiation at the back end, harmonising our positions and views and arriving at figures we think will be sufficient for workers to take home. We hope that will be the case as we approach the next conversation about the national minimum wage in 2027. We hope the conversation will start soon, and we are looking forward to a very strong engagement with organised labour.

Is the private sector ready for its wage review?

At the just-concluded ILO governing body meeting in Geneva, I returned with a document, which I have shared with the Secretary of the National Minimum Wage Committee and the Chairman of the National Salaries, Incomes and Wages Commission. I also shared a copy of the document with the Minister of Labour and the President of the NLC so that we can start educating ourselves on the processes and parameters used globally to guide this kind of conversation. Once we are all on the same page about the parameters, we can then look at our realities as a country. This will make our conversation easier, especially when we are all educated on the parameters we use. However, whether those parameters will yield the actual figure sufficient for our environment is another matter; the fact is that, at least, we have something guiding us and our conversation until we arrive at that level.

What solution do you recommend for the current widespread insecurity?

The security issue in the country is quite unfortunate, and one issue is especially important to all of us: homeland security. Wherever there is insecurity, you will hardly find businesses there. In the North East, you will hardly find any business, because no rational investor will take their capital to an environment where they are perpetually under threat. It is also jeopardising the young people in those places’ ability to get work. You cannot work at the corporate level and you cannot go to the farm due to security concerns. One way or the other, you have to eat. So, they are exposed and vulnerable to being recruited as tools in the hands of bandits and other unscrupulous individuals. While we continue to commend the government and the gallantry of the Nigerian military, we also hope that more efforts will be made to address these issues.

High unemployment figures are a major socio-economic concern, especially among young people. What specific measures would you want the government to take to address this and to tackle the growing skills gap between graduates and the demands of industry?

I think the first thing we need to ask is what causes unemployment. There are two main factors. The first is job availability. For employment to exist, there must be jobs. The second is a skills mismatch. There are jobs, but there are no skilled individuals to fill them. The first part concerns job creation. Who can create the jobs? Businesses are the primary creators of jobs. For every 10 jobs created, nine are created by the private sector. So, why not focus on those in the private sector? For every 50 jobs created, we will give you a percentage tax rebate.

The second part is that if 100 companies create jobs yearly, multiplying that by 50 gives about 5,000. You are creating 5,000 direct jobs. You are not only creating 5,000 direct jobs, but also indirect jobs, because those 5,000 people who get jobs will increase their capacity to patronise other businesses. Because the customer rate is now increasing, their generated income is also rising, and they have the capacity to expand and upscale their production. And because they are upscaling production, they also employ. So, you have created 5,000 direct jobs with the potential to create another one million indirect jobs.

The second part is the issue of skills mismatch.

If there is a skills mismatch, where do we address it from? Do we address it with the universities through the National University Commission? Do we have to tweak our curriculum at the university level? With the advent of artificial intelligence (AI) and the influence of information and communications technology (ICT), it would be unfortunate if we were still running the courses we ran 10 years ago in universities. Or if, at the primary and secondary school levels, we are still doing it the way we used to, then what are we preparing them for? Which future are we preparing them for?

Ahead of Workers’ Day, what is NECA’s message to Nigerian workers and labour leaders?

We want to commend our social partners, the Nigeria Labour Congress (NLC) and the Trade Union Congress of Nigeria (TUC), for keeping the engine of production running. We commend them for their commitment, resilience, and doggedness, and for the cooperation we are fostering between organised labour and the private sector to ensure that our mutual interests in productivity, decent work, and decent wages are met proportionately.