Nigerian labour unions demand for N615,000 minimum wage

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Introduction

President Bola Tinubu is a year old in office. On several occasions he has promised Nigerian workers not only a minimum wage but a living wage. What Tinubu has in mind as a living wage is probably known to him alone. On October 2, 2023 after a marathon meeting with the labour unions to forestall their threat of embarking on indefinite strike, he agreed to paying federal workers N35,000 wage award from September 2023 until a new minimum wage comes into effect and also said a new minimum wage committee will be inaugurated by November 2023. This did not happen until Tuesday, January 30, 2024. It must be stated that labour law expected a new national minimum wage every five years and negotiation committee to be inaugurated at least six months to the expiration of the extant one. Under Tinubu it was inaugurated barely three months to the end of the current one.

37-member tripartite national minimum wage committee

The new minimum wage should have kicked in by April 2024 but the only assurance Tinubu’s government has given is that whenever it is eventually agreed to, the new minimum wage will take effect from May 1, 2024. As earlier said, the Federal Government on Tuesday, January 30, 2024 inaugurated the 37-man Tripartite Committee on National Minimum Wage. Vice President Kashim Shettima who inaugurated the committee at the Council Chamber of the Presidential Villa Abuja, charged to them to ensure the timely submission of their recommendations. The Committee chaired by the former Head of the Civil Service of the Federation, Goni Bukar Aji, is made up of members of the organised labour, the private sector and the federal and state governments. Shettima said the decision to set up the committee is a recognition of the need to ensure a decent living wage and in compliance with the existing National Minimum Wage Act of 2019.

Membership of the committee cuts across the Federal Government, state government, private sector, and organised labour. Present at the inauguration are some state governors, including Bala Mohammed of Bauchi State; Mohammed Bago of Niger State; Ademola Adeleke of Osun State, and Bassey Otu of Cross River State. Members of the committee from the Federal Government   include Nkeiruka Onyejeocha, Hon. Minister of State, Labour and Employment; Mr. Wale Edun; Minister of Finance & Coordinating Minister of the Economy; Alhaji Atiku Bagudu, Hon. Minister of Budget Economic Planning; Dr. (Mrs) Yemi Esan, Head of the Civil Service of the Federation; Dr. Nnamdi Maurice Mbaeri, Permanent Secretary, GSO. OSGF and Ekpo Nta, Esq, Chairman/CEO, NSIWC – Member/Secretary.

From the states, Alh. Mohammed Umar Bago, Governor, Niger State- representative from North Central; Sen. Bala Mohammed, Governor Bauchi State- representative from North East; Alh. Umar Dikko Radda, Governor Katsina State- representative from North West; Prof. Charles Soludo, Governor, Anambra State- representative from the South East; Sen. Ademola Adeleke, Governor, Osun State- representative from South West; Mr. Otu Bassey Edet, Governor, Cross River State- representative from South West are part of the committee. From the Nigeria Employers’ Consultative Association (NECA) – Adewale-Smatt Oyerinde, Director-General, NECA; Mr. Chuma Nwankwo; Mr. Thompson Akpabio with also members from the Nigeria Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) include Asiwaju (Dr) Michael Olawale-Cole, National President; Hon. (Dr) Ahmed Rabiu, National Vice President and Chief Humphrey Ngonadi (NPOM), National Life President.

The members from the National Association of Small and Medium Enterprise (NASME) are Dr. Abdulrashid Yerima, President & Chairman of the Council; Hon. Theophilus Nnorom Okwuchukwu, Private Sector representative; Dr. Muhammed Nura Bello, Zonal Vice President, North West and also from the Manufacturers Association of Nigeria (MAN) are Mrs. Grace Omo-Lamai, Human Resource Director, Nigerian Breweries; Segun Ajayi-Kadir, mni, Director-General, MAN; Lady Ada Chukwudozie, Managing Director, Dozzy Oil and Gas Limited. From the organised labour, the Nigeria Labour Congress (NLC) Comrade Joe Ajaero, President, NLC; Comrade Emmanuel Ugboaja, mni; Comrade Prince Adeyanju Adewale; Comrade Ambali Akeem Olatunji; Comrade Benjamin Anthony and Prof. Theophilus Ndukuba. Also, membership from the Trade Union Congress of Nigeria (TUC) include Comrade (Engr) Festus Osifo, President, TUC; Comrade Tommy Etim Okon, Ph.D., Deputy President I, TUC; Comrade Kayode Surajudeen Alakija, Deputy President II; Comrade Jimoh Oyibo, Deputy President. III; Comrade Nuhu A. Toro, Secretary-General and Comrade Hafusatu Shuaib, Chairperson Women Commission.

Labour Unions demand N615,000 national minimum wage

The labour unions have placed their demand of N615,000 as the new minimum wage and are expecting an offer from the Federal Government. The unions have also demanded that the new Act should have a two-year life with an agreement for automatic adjustment in wages any time inflation exceeds 7.5 per cent. Unions have also demanded that every employer with up to five workers in his employ shall pay the new minimum wage and have asked for the strengthening of monitoring and compliance mechanisms to penalise non-complying state governments and organisations.

On the other hand, the Nigeria Governors’ Forum, on Thursday, May 2,2024 emphasised the need for the government and organised labour to come up with a sustainable minimum wage in the ongoing negotiations. The NGF, which made the call in a communique issued at the end of its virtual meeting and signed by its Chairman and Kwara State Governor, AbdulRahman AbdulRazaq, assured labour of governors’ commitment to pay the workers an improved wage.

The Issues

Giving the rising cost of living, the inflation and devaluation of naira, the Nigerian labour unions are right on their demands. However, the reality on ground is that no government; be it federal, state or local government or the organised private sector can afford to adjust minimum wage from N30,000 to a whooping N615,000. As at now, many state governments are not paying the agreed N30,000 minimum wage of 2019. I recall that Ogbeni Rauf Aregbesola as governor of Osun State could not pay N15,000 minimum wage to the state workers between 2010 and 2018. Rather he was paying in percentages. Many state governors such as Senator Uba Sanni of Kaduna State have voiced their concern that their states are finding it difficult to pay the extant N30,000 minimum wage because of paucity of funds starting with debt burden they have to pay, reduction in their monthly subvention, low internally generated revenue, and increased cost of governance.

Many governors are of the opinion that workers constitute barely ten per cent of the population of their states and they have to provide social amenities such as good roads, hospitals, schools, electricity, potable water, and recreational facilities for the entire population of the state. More so, Ministries, Departments and Agencies will need to have running cost. So, the country is in a Catch 22 situation. Workers demand for welfare is good but realistically, affordability and sustainability are concerning.

If forced to pay the new minimum wage, government at all levels including the organised private sector may resort to retrenchment of workers under the guise of right-sizing and downsizing. Thoughts must also be spared for senior citizens who are retirees. Their pensions and gratuities may not be paid.

The way forward

Personally, I believe that the new national minimum wage should not be less than N70,000 and not more than N100,000 for purposes of affordability and sustainability. Ultimately, I advise that the Labour Act should be amended to allow for a decentralised minimum wage negotiation. Federal Government should negotiate with the leadership of labour unions at the centre while state governors should be allowed to discuss with labour unions in their respective states and agree to an affordable and sustainable minimum wage. The truth is that states do not have the same population size, labour force, federal allocations and IGRs. This reflects in their respective annual budgets. Insisting on national minimum wage will continue to lead to threat of sack of workers or situation where governments will owe workers backlog of salaries. In the organised private sector, many industries and companies are resorting to casualisation in order to reduce administrative cost. They know fully well that casual staff will have no privileges of full staff who get transport allowance, health benefits, housing allowance, leave bonus, feeding allowance and on retirement will be entitled to pension and gratuity.

Conclusion

It is imperative for the National Minimum Wage Committee to conclude its work without further delay  by arriving at a win-win situation for both the government and workers’ unions. It is noteworthy that whatever is agreed on will still have to be sponsored by the president as an executive bill to the National Assembly who will review it, pass it and send it back to the president for assent before it will become law and operational. Time is therefore of essence as the deadline has already been missed. I implore the labour unions to be reasonable and soft-pedal for a realistic national minimum wage to be expeditiously agreed on. Best of luck!

This article was first published in THISDAY newspaper of 14 May 2024

 

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