The Renewed Call for New Minimum Wage

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Workers’ unions recently walked out on the Federal Government during the  May Day celebration in protest against perceived lack of action to initiate a new minimum wage. Senator Iroegbu looked at the contending issues, actors, prospects and challenges

May 1, 2017 often referred to May Day or Workers’ Day,  could be said to have officially marked the end of a precarious honeymoon between the organised labour championed by the Nigerian Labour Congress (NLC) and the Federal Government through the Ministry of Labour and productivity.

This is evident in the display of a soured relationship during the  May  Day celebration at the Eagle Square, Abuja with the workers walking out on the Minister of Labour and Productivity, Sen. Chris Ngige. The angry workers had protested the tough economic conditions in the country, and went on to disrupt the rally organised to commemorate the Workers’ Day.

The workers complained about what they described as the insensitivity of the federal government to their plight, describing the absence of President Muhammadu Buhari and Vice President Yemi Osinbajo at the rally as ample evidence of their disregard for labour.

Consequently, their protest forced very important dignitaries, including the Speaker of the House of Representatives, Hon. Yakubu Dogara; Ngige; and former governor of Edo State, Adams Oshiomhole, to leave the event abruptly.

While some of the protesting workers noted they could understand the absence of Buhari, who was presumed ill, they objected to Osinbajo’s preference for honouring an invitation to attend a lecture in Lagos instead of honouring them at the May Day rally.

Added to the insult  was the decision of the Labour minister to ask Ms. Biola Bawa, the acting Permanent Secretary of the ministry, to read his speech.

Frustrated, NLC stressed the fact that no concrete step had been taken by the federal government on the demand for the harmonisation and implementation of a new minimum wage  in the country.

The organised labour union now anchored their grouse on the fact that they agreed on a new minimum wage and government seems to have done nothing about it. To this, they demanded immediate action or no more cooperation.

The Genesis 

Following the decision of the federal government to remove fuel subsidy last year and increase pump price of the Premium Motor Spirit (PMS) from N87 to N145, the organised labour under the NLC and  Trade Union Congress of Nigeria (TUC), negotiated  among other palliatives,  N56,000 as the new national minimum wage.

As part of its negotiation trade-offs, the federal government claimed to have budgeted about N500billion as a palliative to cushion the effect of the increase in pump price of petroleum.

In addition, President Muhammadu Buhari early this year was reported to have given a go-ahead order for a 29-man committee of the government and organised labour to negotiate a new national minimum wage for workers.

Ngige was quoted to have assured in March this year that the government and labour unions met to finalise the report of an earlier constituted technical committee.

According to him, the next stage was to constitute the minimum wage review committee which will work with the report of the technical committee.

He said: “When the national minimum wage committee finishes its work, it will go to the National Assembly because all national minimum wage issues are issues that are on the exclusive list. So it is within the ambits of the National Assembly in accordance with the 1999 constitution as amended.

“The meeting was the final conclusion meeting of the Federal Government and Labour technical committee on the issue of the review of minimum wage and the prescription of the palliatives.

“The committee is supposed to put up a framework for the composition, functions and establishment of a minimum wage tripartite committee to review the hitherto existing 2011 minimum wage as well as prescribe to government the areas of palliatives that will enable the economy cushion the effect of the increase in the pump price of petrol.

“The committee has finished its work and we held a conclusion meeting to finalise our report and this we successfully did. This committee will now take this technical report and hand over to the main committee of Labour and government.

“It may be sometimes next week if everything goes normal, and we have started consulting on the day.”

Ngige assured that once they receive the report, “the committee will adopt the technical report or make some amendments and then submit it to Mr. President, and based on the report, the President will constitute a national minimum wage tripartite committee.”

Government Inaction

The workers had in various fora expressed frustration that despite the mouthed plans by the Federal Government to ease their suffering occasioned by the fuel subsidy removal, nothing seems to be moving and no concrete action has been taken to address the dire situation.

The battle line was already drawn prior to the Labour Day, when the Deputy President of NLC and Chairman of the 2017 May Day celebration, Comrade Peters Adeyemi, said  the federal government lied to Nigerians when it promised to roll out palliatives to ensure the citizenry do not feel the impact of the fuel subsidy removal.

Adeyemi said contrary to the promise by the federal government that it budgeted about N500billion as a palliative to cushion the effect of the increase in pump price of petroleum, there was no such thing.

He, however, vowed that the organised labour union was determined to ensure government review the N18, 000 minimum wage.

According to him, “Federal government told us when we protested against the increase of pump price of fuel from N87 to N145 that N500billion was budgeted as a palliative for workers, but to our greatest surprise, we discovered there was nothing as such; rather government is blaming the situation on the price of crude oil at the international market.

“We are determined to ensure government provide palliative to cushion the effect of harsh economic policies of this government and also ensure there is food on the table of Nigerians.”

Adeyemi said Nigerian workers would among other things, during the May Day, include immediate implementation of the new minimum wage.

He said: “We shall use this opportunity to renew the call for the review of the national minimum wage that is overdue for review considering the current economic trend.

“Inflation has increased, the naira has lost its value and current minimum wage has been completely eroded. Therefore, the need and urgency for a call for the review of the current minimum wage.”

On the theme of this year’s celebration, ‘Labour relations in economic recession: an appraisal,’ the labour leader said it would provide working class the opportunity to engage the government on how to revive the economy.

He further stated: “As the theme of this year’s May Day suggests, this is a time for us as working class to look at the present economic situation that has witnessed negative downturn and the reality of the moment.

“We need to critically look at the opportunity afforded us to work toward achieving economic revival and chart a way to a national rebirth, economic recovery and advocate for the engendering of socio-economic policies that is pro-poor.”

And true to this, the NLC triggered the demand for immediate implementation of the new minimum wage that resulted in the famous May Day celebrations walkout at the Eagle Square.

In the same vein, the NLC President, Comrade Ayuba Wabba, while speaking earlier on the Workers’ Day, shortly before the protests, painted a gloomy picture of the Nigerian worker.

In his address titled: “Labour Relations in Economic Recession: An appraisal,” he accused the federal government of reneging on its promises for palliatives after the fuel subsidy removal.

He also called for the immediate implementation of the national minimum wage, the Economic Recovery and Growth Plan, as well as the revival of the Ajaokuta steel plant.

Wabba said: “As we all already know, Labour relations in times of economic crisis are often turbulent. We have had continuing crisis of non-payment of wages, allowances and pensions almost across board. Even with two bailouts by the federal government and Paris Club loan refunds to states, as at this May Day, about 12 state governments still owe their civil servants several months of unpaid wages, pensions and gratuity.”

He regretted that the debtor states had deliberately sought not to prioritise payment of workers’ salaries and entitlements, adding that reports at the NLC’s disposal indicated that part of the problems of states was their debt burden.

Wabba said cutting down on cost of governance and keeping security vote at not more than 5 per cent of the state’s revenue would go a long way in making resources available to address the current situations in most states.

The workers’ frustration was also re-echoed by the President of National Union Local Government Employees (NULGE), Ibrahim Khaleel.

“The truth is that workers at local government level are really not happy. We feel side-lined in so many areas. We are not happy because we are not getting our salaries as at when due. Workers at local government are the most affected when it comes to issue of non-payment of salaries,” Khaleel said.

On the issue of minimum wage, he said: “As you are aware, the present N18, 000 minimum wages came into effect since 2011”.

He stressed that between 2011 and now, so many things have changed, particularly the economic recession in which the country is wallowing .

“By that you know the inflation rate is going higher and higher every day. And the naira has lost its value. This singular fact alone is enough for government and employers of Labour to see reason as to how the minimum wage can be enhanced so that workers can live happily with their families and dependants. But as you are aware, every effort to achieve that, government has been playing delay tactics,” he concluded.

Government Response 

Caught off-guard by the Labour unions’ outbursts, the federal government went to re-echo measured assurances to Nigerian workers.

Buhari in his May Day speech, which could not be read to the workers, assured that his administration would approve the final recommendations of the committee comprising government and labour representatives for the constitution of a new national minimum wage committee to set a new minimum wage for workers.

The committee, he said, would start work on the workers’ demand within the next three months. 

He also promised to take steps towards providing palliatives to workers with a view to ameliorating their living conditions.

While enjoining the workers to cooperate with his government in its commitment towards building an egalitarian society, Buhari assured the workforce that his government would deploy every power at its disposal to improve the welfare of workers.

He said: “Government will take necessary steps to implement the final recommendations of the main government/labour committee as it relates to the setting up of New National Minimum Wage Committee and needed palliatives in order to reduce the discomfort currently being experienced by the Nigerian working class.”

In the same vein, Ngige who condemned the actions of the workers who deserted him before he could read the President’s speech, said that the “Federal government has been fair to workers and it showed it by releasing bailout funds to state governors,” adding: “Part of this government’s fairness has been demonstrated by our firm commitment in making sure that no worker is laid off. What happened today is simply that this place was infiltrated by non-workers.”

The minister urged workers to be patient with the minimum wage demand, assuring them that the minimum Wage Negotiating Committee would start functioning within the next quarter which is in the next three months.

He also assured the workers that the backlog of promotion arrears and repatriation allowances, relocation allowances and other allowances that are due to them as emolument would be paid soon.

“My message for the workers is that they should be patient, they should give us some time. Within the next quarter, the Minimum Wage Committee will start functioning within the next quarter which is in the next three months. The backlog of promotion arrears and repatriation allowances, relocation allowances and other allowances that are due them as emolument will be paid,” he assured.

On his part, former Edo State governor Oshiomhole told Arise TV that Nigerian workers were facing very difficult times due to the present economic recession in the country but noted that the situation was a response to the mismanagement of governance by past governments.

He noted that what the Buhari government was trying to do was to check the excesses of the past and make sure that Nigeria was not made a dumping ground and to ensure prudent management of resources so that the workers and other Nigerians would enjoy better economy and improved welfare in future.”

On their part, the Senate called for an upward review of the minimum wage from N18, 000 to a living wage that would ensure some decent standard of living for Nigerian workers.

The lawmakers said the poor wages and failure to pay salaries would militate against the anti-corruption war of the president.

They, therefore, urged the government to formulate and implement welfarist policies and establish a surveillance unit that will ensure proper, timely delivery of all necessary welfare packages to Nigerian workers.

The resolution was sequel to a motion sponsored by Senator Suleiman Nazif (Bauchi North), on the welfare of Nigerian workers ahead of the 2017 workers day celebration.

“One of the major agenda of this administration is to fight corruption and you know very well that without productivity, fighting corruption will be impossibility. If workers are not paid as and when due and their allowances are not taken care of, corruption will certainly continue to be a major problem in Nigeria,” Nazif said.

He noted that Nigeria workers have suffered all forms of injustices including a lack of adequate housing, access to transportation and effective health facilities, pension entitlements, among others.

“The Senate observes that the untold hardships that Nigerian workers are experiencing as a result of poor welfare packages are quite alarming,” he said.

The Will Vs. Capacity 

While the need for a new minimum wage is not in doubt, many stakeholders have questioned the capacity of the government to match its willingness to pay the proposed N56,000 wage base-cap.

Some have argued that if the state governments are finding it difficult to pay and honour the current N18,000 minimum wage with some state like Kogi owing up to 15 months, how could they possibly comply with the new demands.

But the Senate has singled out corruption, noting that despite bailouts made to states by the federal government, and monies received in the Paris Club refunds, several states have continued to owe workers’ salaries and pensions.

Senator Dino Melaye (Kogi West), contributing to the debate, said workers were being owed in his state, despite the bailouts and Paris Club refunds, leading to industrial strike actions by the academic and non-academic staff of the state’s tertiary institutions.

“The first set of bailouts was given to governors. Again, a second set of bailouts was given to state governments. As if that was not enough, Paris Club (loan) refund was also released to state governments,” he said.

“If these governors, including my governor, got bailout 1, bailout 2 and Paris refund 1, yet did not pay salaries; if they get the second tranche of the Paris Club refund, they will still not pay salaries. How do we then compel them to become responsible and responsive to the magnanimity shown by Mr. President? It is to make sure that we use our oversight responsibility and constitutional powers to direct the Federal Ministry of Finance to stop the second tranche of the Paris Club refund to state governors who have not paid salaries. The essence of these bailouts was actually to pay salaries, arrears and pensions,” Melaye added.

In the same vein, the Deputy Senate President, Senator Ike Ekweremadu, said the upper legislative chamber would always stand with workers just as it has always done.

“This is a timely call for all states to ensure that they address all issues that we raised today, especially those concerning the welfare of our workers. We believe that in doing so, they must also take the cognisance of the fact that those who retire are entitled to their gratuities and pensions. These are being denied despite all the efforts by the National Assembly to provide the legal basis to ensure that these monies (bailouts) were paid,” he said.

Also speaking on the matter, Oshiomhole lamented that most of the states’ workers were owed, some up to 12 months. “So people are hungry and angry, but no matter whatever your grievances are, you must listen to your employer,” he said.

He said that the Nigerian workers are trying to determine their wages through the demand and supply mix, but noted that it was not the salary demanded by the workers that was paid to them but what they were able to negotiate with their employers.

Nevertheless, the former NLC President said that he had demonstrated in Edo State that payment of the new minimum wage is possible.

The former governor said that N18, 000 was not a living wage and that was why as governor, he increased the minimum wage in Edo State to N25, 000 but noted that such amount was not a living wage too.

He also remarked that no one actually earned a minimum wage because no worker was on grade level 1, adding that those who earned such low income were the vulnerable that should be protected, noting that responsible employers should pay a living wage.

This ability to abide by the proposed wage raise for the Nigerian workers was supported by the Governor of Gombe state, Ibrahim Dankwambo, who assured to pay the new minimum wage, if approved.

The conclusion from stakeholders in the workers welfare is that the new minimum wage is possible, if the government is willing, responsible and committed to its mandate.