Former Minister of Works and Housing, Babatunde Fashola, has said that the National Assembly can only enact laws on the minimum wage for workers and not their salaries.
Fashola said this in an article titled ‘Minimum Wage Review – My Takeaway’, adding that what the constitution allows to be legislated on in the exclusive-legislative list is Nigeria’s minimum wage.
According to him, anyone earning a salary is paid a fixed amount over a period of time, while anybody earning a wage is paid by the hour.
The former governor of Lagos State said this amid the negotiations currently going on between organised labour and the federal government.
The labour union has asked for an increase in the minimum wage of N30,000 as a result of the rising inflation that has made life unbearable for Nigerians.
Labour leaders initially demanded N497,000 as the new minimum wage, which they reduced to N494,000 but with the federal government rejecting their request, the former declared a national strike.
Both parties thereafter went into more talks with the federal government offering N62,000 as the new minimum wage, however, the labour union has insisted on N250,000.
Fashola reacting in his article said that the Nigerian constitution needs to be amended to give room for the fixing of minimum salaries for workers.
“In my recent monograph, ‘The Nigerian Public Discourse: The Interplay of Empirical Evidence and Hyperbole’, I had made the point at page 89 that the word used in item 34 of the Exclusive Legislative list is minimum wage,” he said.
“It does not talk about salaries. I further stated that ‘…it has also been shown, wages and salaries are different and should not be conflated.’ I posited that ‘…efforts to improve minimum wage must be that and nothing more. It must not translate to a salary overhaul by accident’.
“Therefore, it seems obvious from this definition that by making a law in Section 3(1) of the Minimum Wage Act that the minimum wage of N30,000 shall be paid monthly, the NASS may have acted unconstitutionally by legislating on a SALARY (monthly payment) when they only have power to legislate on WAGES, an hourly payment.
“This is important while the conversation on minimum wage is being had in 2024 because in Section 3(4), the minimum wage ‘shall be reviewed in line with the provisions of this Act’ which includes Section 3(1) that has prescribed a monthly amount instead of an hourly wage.
“If we follow the proper definition of wages as an hourly rate and apply the global method for computing it, which is to divide the gross annual sum by 52 weeks, and further by 40 hours recommended per week, we will have for Nigeria a minimum wage that is not N30,000 per month, but rather N30,000 X 12 (months) = N36,000 divided by 52 (weeks) = N6,923.07 divided by 40 (hours), which will give a minimum wage of N173.07 per hour.
“What we have done is to erroneously fix monthly minimum salaries as wages, and then effect consequential adjustment for all other SALARY EARNERS, which results in a bloated compensation wage that employees find difficult to meet.”
Also according to Fashola, both high and low income earners in Nigeria deserve adjustments in their salaries and wages owing to the rising cost of living in the country.
