Still on Organised Labour’s minimum wage demand

The Nigeria Labour Congress (NLC) and Trade Union Congress (TUC) on Tuesday suspended the nationwide strike it embarked on the previous day over a new national minimum wage. In this report, PAUL OKAH wonders if their demand is reasonable.

The Nigeria Labour Congress (NLC) is used to calling off proposed industrial actions, which made Nigerians to often regard the Congress as a toothless bulldog. However, it surprised the citizens on Sunday night when it said there was no going back on the industrial action it proposed to press its demand for “a reasonable minimum wage.”

The strike, which it started on Monday, June 3, led to essential services such as fuel distribution, health care services, banking and power supply being shut down nationwide while they deliberated with the federal government.

Despite Labour suspending the strike for a week on Tuesday, as a result of the federal government agreeing to pay more than N60, 000 as new national minimum wage, the NLC and TUC said they would resume the strike if their demands were not met.

Issues at stake

According to the NLC and TUC, the strike was due to the failure of the federal government to negotiate a new minimum wage for the workers, including the reversal of electricity tariff hike and division of electricity users into bands. The NLC and TUC initially proposed a new minimum wage of N615, 000, citing the high cost of living as a result of the removal of fuel subsidy announced last year, but lowered it to N495, 000, after negotiations and deliberations.

On Monday night, the federal government initially insisted on paying N60, 000, but accepted to pay “an amount higher than N60, 000,” adding that the proposed amount from the labour union “is unsustainable.”

Furthermore, the organised private sector, which was also part of the tripartite committee set up by the government on the issue, said they accepted the sum proposed by the federal government.

The NLC has been pushing for a living wage to address the issues of poverty, inequality, and poor working conditions in Nigeria. The demand for a living wage is also in line with the International Labour Organization (ILO’s) recommendation that workers should earn a wage that allows them to enjoy a decent standard of living.

However, analysts have noted that the implementation of a living wage would depend on various factors, including the country’s economic conditions, industry-specific factors and the ability of employers to pay as any agreed minimum wage will set a benchmark for private employers to follow.

Demand unrealistic

Speaking with Blueprint Weekend, an analyst, Peter Gbenga, said the demand by Labour “is unrealistic as the government cannot afford it.”

“Labour did well to call off the strike as it was unreasonable at any length. While I don’t find Labour’s N484, 000 minimum wage demand as realistic, let me also add that anything short of N120, 000 as minimum wage of an average Nigerian worker amounts to cheating on the part of the workers.

“Here is my analysis: Fuel price rose by 300% following fuel subsidy removal, the same per cent rate should be applied in increasing the minimum wage. The current minimum wage stands at N30, 000, while a 300 per cent increase of the minimum wage is N90, 000. N90, 000 (increase in minimum wage) + N30, 000 (current minimum wage) = N120, 000.

“On the other hand, the FG can return fuel subsidy removal as all these salary increases will not work because of the high cost of living in Nigeria. Truly, the economy is not working fine. NLC should not disappoint the masses again by settling for anything less as fuel, electricity and food prices are very high,” he said.

Also speaking with this reporter, a civil servant, Justina Joel, said the economy is biting and that NLC should look into states paying any agreed minimum wage.

She said, “How many people are working for the government compared to the country’s population? I believe you know that it is not only government workers that patronise the market and there is no separate market for government workers. Abia state is yet to pay N30, 000 minimum wage. Zamfara state just started paying it last month, since 2019, while Borno state is also not paying it in some sectors. So, the NLC should direct more of their energies to the states because federal workers are nothing compared to state workers.

“Again, the analysis should center on minimum wage and the implications on the economy. Wage issue is on the exclusive list. It’s the prerogative of the FG to lead on the debate. What governors are doing or not doing with federal allocation is subject of another debate. This is not about being a Professor of the economy. Common participatory knowledge of the economy is enough to understand the situation at hand.

“Inflation is high, induced or caused by impromptu decision of the federal government to remove fuel subsidies. The attendant effect is what we are experiencing now. My take is that the wage should be raised to match the inflation; otherwise workers will go into extinction economically. Don’t forget that the law allows five years interim before the next negotiation on wage.”

She said further, “Please, for the sake of God and the millions of Nigerian workers and citizens dying under the harsh weight of the economic discomfort, I beg NLC not to back out of this fight no matter how hot it gets. Minimum wage should, at least, be up to what a bag of rice is currently sold. If you see how teachers line up along our roads to beg for lifts from private car owners, you’d understand why this fight must be dragged to the very end.

“Let it also be agreed and signed, when the payment of the minimum wage will commence. Many states are yet to implement the 30k minimum wage agreed in 2019 even. Please, look into it. We are suffering and we can’t bear it further. Imagine that I, as a teacher who decided to get online cannot even buy a good phone. Don’t back out, I beg you.”

Inflation

In his view, an economic expert, Mr. Abanishe Olanrewaju Taofeek, said a higher minimum wage would trigger unprecedented inflation, adding that Labour should accept the amount offered by the federal government.

He said, “I support Labour on the issue of a new national minimum wage to reflect economic realities. However, anything above N100, 000 as minimum wage will be a disaster for the country. Do you consider what paying N120, 000 minimum wage will cause to the economy? It will trigger inflation to above 50%. If N120, 000 is agreed to be paid by the federal government, remember federal government workers are just less than 2% of the entire population. The new minimum wage will become a law that will bind on all employers of labour from private school owners to state government workers to LG workers, manufacturing companies etc.

“Now, how do you think the manufacturing companies will meet up with the obligation? They will jerk up their product prices to be able to pay and who will bear the brunt? What about the masses who are not earning salaries from either the federal or state government?

“Schools will also pay their lowest staff the same N120, 000 and how will they pay the money? They will also increase their school fees to meet up with the wage demands. Who will bear the brunt? Remember, our present and past leaders have killed public primary and secondary schools so don’t even think about it as an option. Traders in the market selling groceries will also pay their children school fees which means they will have to increase their own prices too in order to maximise their profits and settle their bills. The list is endless and the cycle continues.

“I know our government is not responsible, but paying salaries is not only their obligation as we want them to construct roads, build schools, and provide good healthcare delivery, electricity and so on. Where will the money come from? They will further devalue the Naira and also increase the taxes like VAT, duties etc then Labour will now come back to ask for a new minimum wage.

“In conclusion, anything above N100, 000 as minimum wage will be a disaster for the country. What I expect from Labour is to stand on the reversal of new electricity tariff, stop floating of the Naira and pegging our exchange rate to like N650/$1, demand for a working and functioning refinery, press the government to cut down their extravagant expenses and reduce the cost of governance.”