Economy, Featured
As the issue of minimum wage remains unresolved, the Nigerian organised labour is threatening to shut down the nation’s economy with an indefinite strike billed for November 6
By Emeka Ejere
Few days to the November 6 shutdown of the economy as threatened by organised labour, a peaceful resolution to the minimum wage brouhaha plaguing the country still looks unlikely.
However, the National Industrial Court of Nigeria, on Friday, November 2 ordered the organised labour comprising the Nigerian Labour Congress, NLC, and the Trade Union Congress, TUC, not to embark on their planned indefinite strike. But the labour unions are insisting that there is no going back on the strike.
Nigerian governors had on Tuesday night, announced that states can only afford to raise the national minimum wage from N18, 000 to N22,500 as against the N30,000 being demanded by organised labour down from original demand of N56,000.
The declaration came after an emergency meeting of the Nigeria Governors’ Forum, NGF, purportedly prompted by a nationwide protest same day by the NLC and the TUC to sensitise Nigerians to the planned national strike scheduled to begin on November 6.
It would be recalled that in September, the NLC declared a nationwide strike over the stalled process of providing a new national minimum wage, but the strike was hurriedly suspended after a few days because an agreement was reached to resume negotiations by reconvening the tripartite committee set up to find a lasting solution to the problem.
The 30-member tripartite National Minimum Wage Committee was inaugurated by the federal government in November 2017, to negotiate a new wage for workers by reviewing the current N18, 000 which came into effect in 2011 and recommending another that takes care of the current conditions of living in the country.
No sooner had information leaked out that the committee had concluded its assignment and report ready to be sent to President Muhammadu Buhari, than the Chris Ngige, minister of Labour and Employment, after the Federal Executive Council, FEC, meeting of October 10, 2018, debunked the claim that the committee was yet to arrive at a consensus figure to be recommended to the Federal Government as the new national minimum wage.
According to Ngige, among others, said “negotiations are still on-going in light of the fact that at the last meeting, the figures submitted by the constituencies that make up the Committee are as follows: state governments, N20,000; federal government N24,000; organised private sector N24,000; organized labour, N30,000.”
But the organised labour insisted that negotiations had been concluded and that in the traditions of social dialogue, spirit of tripartism and collective bargaining, the committee negotiated, deliberated, and consulted widely before arriving at the figure of N30, 000 by consensus.
In response, organised labour warned that it would no longer enter into any fresh negotiations with government over the issue of a new minimum wage, informing that if government failed to implement the N30,000 recommended, it will from November 6, begin a nationwide indefinite strike
The essence of national minimum wage is to protect the right of the worker to earn a decent standard of living and also a means of promoting fair distribution of income and wealth.
The minimum wage is usually adjusted through a continuous process of comparing the purchasing power of minimum wages in relation to different baskets and across the regions within the fiscal regime.
Before the coming of Hassan Sunmonu as first president of the NLC in 1978, there was no history of a structured minimum wage for workers. The Udoji pay package of 1975 was not regarded as a structured minimum wage, because it was not negotiated by workers’ representatives.
The then president of the NLC was encouraged to begin agitation for a minimum wage following a pay rise for political leaders at the time. He called for a N300 per month minimum wage in 1981. This led to a major strike, which culminated in President Shehu Shagari and the Hassan Sunmonu-led executive agreeing to a N125 per month pay package.
Those that led the negotiation on behalf of the Federal Government included the then Vice President Alex Ekwueme, Joseph Wayas, the then Senate president, and Ume Ezeoke, the then speaker of the House of Representatives.
Another negotiation came up 1989/90 when the late Pascal Bafyau was NLC President. Adams Oshiomhole led the talks as Bafyau’s deputy. The discussions resulted in workers receiving N250 per month.
An opportunity for another round of negotiation opened 1989/90, during the administration of General Abdulsalami Abubakar. The minimum wage was moved to N3,000. The team was not an organised labour body but a committee of industrial unions, led by Sylvester Ejiofor.
Another negotiation took place while Oshiomhole was NLC President between 2000 and 2001. Demands for N5,500 for state workers and N7,500 for their federal counterparts and oil-producing states were agreed to.
There were unique features to this deal; provisions were made that the following year (2002) there would be a 15 per cent increase across board, and a 25 per cent increase in 2003.
These, however, were not fulfilled. The current N18,000 minimum wage, due for a review since 2015, was negotiated under Abdulwahed Omar, the then NLC president.
In 2011, CBN data showed inflation at about 10.8 per cent, with exchange rate of the naira to the dollar averaged between N151.96 and N155.26.
The country’s gross domestic products, GDP, stood at about $411.7 billion and GDP growth rate at about 8.2 percent.
In 2018, the NBS put inflation rate in the second quarter of the year at 11.23 per cent, with exchange rate of naira to the dollar at N306.25, or N362 in the parallel market. GDP is estimated at $375.77 billion since 2017, growing at the rate of 2.9 per cent.
To compute a minimum wage, consideration is usually given to the prevailing cost of living index, inflationary trend and capacity of employers to pay a living wage.
Living wage is based on the belief that a worker should earn enough income from his or her work to afford the basic living costs of his or her family.
According to WageIndicator.org, living wage is an approximate income a worker needs to meet his or her family’s basic needs for food, housing, transport, health, education, tax deductions and other necessities.
In other words, living wage should take care of the worker’s food costs, housing costs, transport costs, tax/contribution costs and other costs, including medical and children education. But it appears that the Nigerian governments at all levels do not always bear in mind these factors when paying their workers.
For Ayo Teriba, an economist and chief executive officer, Economic Associates, the real issue in the minimum wage debate is no more whether the demand is necessary, but whether N18,000 take home pay will “take the workers home and allow them live reasonably”.
“Divide N18,000 by 30 days, that comes to N600 a day. What can anybody do with N600 per day?” Teriba asked in an interview with Leadership Newspapers.
At N56,000 (the initial figure labour proposed), he said this would translate to a paltry N1,866, an amount he says is not even up to what some less endowed countries pay their citizens as unemployment allowance.
Divergent views:
Some Nigerians have taken to their social media platforms to lend their voices to the minimum wage debate.
“NLC is battling to squeeze a new minimum wage out of a government that pledged to give Nigeria a new minimum wage. Adams Oshiomhole, the leader of the ruling party, is a former NLC chairman but has never expressed his support for the new minimum wage. He doesn’t give a damn.” – Nafiu T
“Cost of living in Nigerian states are different, same with IGR. Negotiate with the National Assembly to change the law compelling all states to pay the same amount. Compel the Assembly to reduce their package, through picketing, not strike that’d affect the common man.” – Abiodun Afolabi
“Former SGF, Babachir Lawal confessed that he earned N930million monthly under the same .@MBuhari government that has been foot dragging to pay the minimum wage of N56,000 demanded by the Nigerian Labour Congress (NLC)for the Nigerian workers. Where is justice, equity & equality?”- The Great Sage
“NLC wants salary increment when even the government is struggling to pay N18, 000. I think it’ll make more sense if the strike is a protest against the states that are owing those poor workers, but no, we just like to do silly things in this country.” – Il Capitano
“NLC should know that what well-meaning Nigerians want is good policies that will stop inflation and add value to naira not wage increase. What if salaries are increased today and tomorrow price of bread becomes 5k a loaf?” – Hamma
“Government should do the needful. What stops Nigerian government from increasing minimum wage by N50, 000?”- Chidi Peter.
“The NLC never fights for anything other than higher pay. Ask them, how productive are most workers? ‘No-go area’. Even the current structure, most states cannot pay, and recurrent expenditure keeps rising.” – Stephen Oyedemi
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