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More huddles before new minimum wage

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Ayuba Wabba

Though the House of Representatives has passed N30,000 as the new minimum wage into law, there are many huddles the bill would still have to cross before it becomes a reality.

The passage of the bill by the green chamber of the National Assembly followed the adoption of the report of its ad hoc committee on the new wage during the plenary last week.

The passage comes about a week after President Muhammadu Buhari sent the wage bill for consideration, following its approval by the national council of state.

While the council approved the N27,000 and the Federal Government agreeing, albeit in principle, to pay its workers N30,000, it pegged the minimum wage at N27,000 which was a concession to the state governments which insisted they cannot afford N30,000 per month.
But the lawmakers argued that one thousand per day for a family of four is still grossly inadequate.

The lawmakers therefore agreed with the tripartite committee which had relied on empirical data to arrive at N30,000.

The lawmakers also resolved that the bill would be effective the day it is assented to by the president.

Also, contained in the new bill is the provision for a N75,000 fine for defaulters. This replaced N5,000 contained in the 2011 minimum wage bill.

With the milestone the bill has achieved in the House of Representatives, it does appear that the coast is becoming clearer for a new national wage floor in the country.

The main huddles before the bill is whether the Senate will tow the same line of thought when it resumed on February 19th 2019.
February 19th comes four days after the general elections. Would the upper house legislative house still be enthusiastic about a matter that concerns the workers after many of them may not be returning as lawmakers? Would the governors bark down? Would President Muhammadu Buhari sign a bill that contains a figure he was not disposed to in the first place?

Indeed, a sign of what awaits the implementation of the bill was given by the Chair of Nigeria Governors’ Forum, Abubakar Yari.
Yari, who is also the governor of Zamfara state warned the National Assembly against passing a new national minimum wage that would be difficult for states to pay.

Yari issued the warning on the sidelines of the public hearing on new National Minimum Wage bill in Abuja.

The forum has consistently opposed to N30,000 as the new minimum wage even proposing that it would only pay a maximum of N24,000 at some point.
Reacting to the demand of the organised labour, Yari said that the demand for N30,000 as the new minimum was not realistic.
To the organised labour, N30,000 is grossly inadequate to feed, pay school fees, pay house rent and transport workers to and from work for 30 working days.

Labour stated that N30,000 translates to N50 per meal for a family of six (a husband, wife and four children) per day.

President of the Nigeria Labour Congress (NLC), Ayuba Wabba who spoke on behalf of organised labour during the public hearing on a new national minimum wage at the National Assembly complex, argued that government alone, being one of the social partners in the tripartite cannot single-handedly alter a negotiated N30,000 figure.

He stated that the N30,000 was not a figure originally submitted to the minimum wage tripartite committee but a figure that was agreed upon by the committee members which were equal partners on the negotiation table.
Wabba argued that when the minimum wage was equivalent to $150 at N18,000 in 2011, arguing that in 2019, N30,000 is less than $100.
His explanations: “I remember that in 2017 during the May say pandemonium, the national Assembly made a commitment that when the minimum wage hill is submitted, it will receive accelerated hearing. This promise has been kept.
“On this issue of minimum wage, by our database, 11million workers will benefit and we know that the law provides for a wife, a husband and four children. If N30,000 is multiplied by 11, there is no economy that will not be boosted by this singular upward adjustment at least in Naira terms. This is why it is very central.

“The ILO recognizes that minimum wage is one of the most used instruments for wealth distribution in the labour market. Intact, minimum wage is provided for by law in 90 per cent of countries of the world.

“There has been some misconception about what minimum wage stand for. It is the barest minimum that is allowed to be paid to a worker in both public and private sector. When people say we are not supposed to have a minimum wage, that is not true.
“The United States of America is a federal system. It has a minimum wage of 10 dollars per hour and after that, every state can then pay higher. Recently, Microsoft increased its minimum wage to 15 dollars per hour. The principle is that we must protect the most vulnerable worker from exploitation and wage tyranny of employers.

“So, it is not about the state, but about the protection of the individual. If you say remove it from the exclusive list and give it to the states, who will fix for the private sector? Employer cannot and should not determine single-handedly the salary of a worker. This is the principle and if you understand the principle, it will be easier to understand the challenges and work towards addressing them.
“The minimum wage was due in 2016 because through the collective bargaining process of 2011, we all agreed among all the social partners that a five year circle will be used to review the minimum wage. Some important economic challenges arose within the period and fuel price increased by about 85 per cent and electricity tariff also increased.

“In the midst of all these increases, the salary has remained static. From our records, minimum wage has never led to increase in inflation. The fact is that when minimum wage is increased, inflation drops. There are clear scenarios that increase inflation rate in the country and one of them is huge spending during elections.

“This is one factor that we must consider because there will be excess liquidity which will trigger inflation. By the data presented by the National Bureau of Statistics, there is nowhere in the world that minimum wage has triggered inflation.

“When we signed the N18000 minimum wage, it was equivalent to 150 dollars. Today, it is less than 50 dollars. So, the reality is that it is biting hard on the workers and most of them can’t feed their families and can’t even go to work and be productive. This was why we insist on a new minimum wage.

“The issue of tripartite negotiations and social dialogues is an instrument of the ILO which proscribes collective bargaining among social partners. It also says that all partners should come to the negotiation table in equal footing. There are also procedures in arriving at the minimum wage. Collective bargaining agreement is like a consent judgment where partners sit on a table and agree and what has been agreed is transmitted to government who will make it into a law.

“This document which we all signed agreeing is N30,000 was by all the social partners. We looked at all the issues and through the process of negotiation and looking at the economy and ability to pay, labour dropped its demand to N30,000.
“We did not recommend N30,000 but because we want to carry everybody along, and make sure that we are considerate, labour became very responsible and agreed on N30,000 and this document was signed and presented to Mr. President.

“It was agreed to as equal partners and as contained in ILO convention 131, you cannot alter the figures without consulting the social partners involved in the process. I remembered that we considered all issues including how to make sure resources are available so that the wages can be paid because we have been on this path for 38 years. At every stage of negotiating the minimum wage, the same argument has come up.

“I think we should all sympathies with Nigerian workers. N30,000 translate to N1000 per day and N50 per mill for every member of the family. If you have a family of six, a wife husband and four children, it translates to N50 per meal.”

Wabba insisted that most state governors have indicated their readiness to pay the N30,000 minimum wage.

He further argued that if state such as Yobe that is afflicted by Boko Haram insurgency can pay its workers up to date and Katsina is equally paying workers as at when due, it is immoral for any state governor to insist he cannot pay a paltry N30,000.

“We discussed with 30 state governors and they made commitment that they will pay N30,000. The law recognizes individual states and we have attached memos we received from states to our submission. We accepted the N30,000 so that there will be peace. That was how we arrived at the figures. In want to plead that the N30,000 we have agreed on with all the social partners be approved.

“On the bill, we want the figure increased from N27,000 to N30,000. If that is done, it will not be the first. When we got the first minimum wage, this House increased the figure from N100 to N125, which was equal to N200 dollars.

“We want the four circles as contained in the bill and we want it included that if there is a major economic development that affects workers salaries negatively or even positively, wage should be reviewed. Workers create wealth and should partake in the wealth they create. The workforce of any country is an asset to that country,” he added.


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