Over the weekend, the United Labour Congress (ULC) disclosed that it recently opened negotiations with the federal government on a proposed 96,000 Naira minimum wage, assuring members that the proposal would soon yield fruits. The ULC’s call for increment in the minimum wage is another timely reminder of the new realities that Nigerian workers are presently living with.
In 2011, former president Goodluck Jonathan signed the minimum wage of 18,000 Naira into law, and after five years it was due for review. Hence, on May 1, 2016, the organised labour unions, led by Nigeria Labour Congress, NLC, during their workers day celebration, demanded a new minimum wage of 56,000 Naira with the Federal Government agreeing to set up a joint committee to begin negotiations.
The proposed amount for minimum wage has been vacillating between 56,000 Naira by the NLC and TUC, 45,000 Naira by the federal government and the ULC’s 96,000 Naira.
A technical committee was set up by the federal government. And during the presentation of the committee’s report to the former secretary to the government of the federation, Babachir Lawal, the trade union congress chairman, Bobboi Kaigam, called for a benchmark in minimum wage.
‘‘If the states do their minimum wage, which group is going to do one for the private sector and the disadvantaged in the country? ‘‘That goes to say that it must come from the Federal Government and it must cover all. ‘‘So, the government should ensure that the benchmark for all employers is made as a law so that everybody in the country is carried along irrespective of the number of persons employed.
The proposed figures for the minimum wage have not been received with enthusiasm by federal, state and private employers. The government hopes that setting up an all-inclusive 29 man committee will result in a harmonised structure.
On its part, private employers under the aegis of the Nigeria Employers’ Consultative Association (NECA) consider 56000 Naira and indeed any increase as unfeasible. The Director General of NECA, Olusegun Oshinowo says employers cannot adopt the proposed minimum wage because of the impact of the recession on their businesses.
Oshinowo said “the private sector cannot afford an increase at this point. This is the position the employers will canvass at the National Minimum Wage Committee.”
“The priority now should be for all stakeholders to join hands with government to deliver on inclusive growth that will ensure job security and job creation.”
However, with current realities, NNLC’S N18000 is insufficient to meet the needs of an average Nigerian. The recession has also affected the cost of living in the country. The President of National Council of Industry, an umbrella body of industrial unions, African region, Comrade Isa Aremu, believes it’s time for a review.
“It must be stated that the current minimum wage was negotiated in 2010 when the exchange rate was still better than what we have now. In 2010, the current minimum wage equalled $120 per month, but as we speak, it is about $81 per month. That means the minimum wage has fallen terribly by $38.1. This is as a result of inflation and massive devaluation of Naira, which is currently being exchanged at N230 per dollar,” he said. His comments were made last year, now the dollar is at 385.
To better understand the situation of Nigerian workers, comparisons have even been made between what’s obtainable in Nigeria and other African countries.
A Premium Times report shows the difference between both country’s minimum wages. Nigeria’s current minimum wage is N18,000 ($60) with organised labour asking it be increased to at least N50,000 ($166), despite several state and local governments defaulting on the existing amount while south Africa is set to introduce a national minimum wage of 3,500 rand ($261) per month in 2018.
When constituted, the 29 man minimum wage committee that is expected to address the wage issue and other palliatives has to be objective in deciding what the ideal minimum wage should be.
While there is interest in the welfare of workers, it is imperative that questions are raised about the ability of state governments to sustain a new minimum wage. This will ensure that government and employers are not saddled with inordinate wage bill.
Like Oshinowo suggested, focus should be placed on measures that will stimulate all inclusive growth that will lead to job creation, job security and consequently support a new minimum wage. Likewise, states should be ready to explore every alternative to boost their internally generated revenue.
