Minimum Wage… A bill dead on arrival

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The ploy to remove the minimum wage from the Exclusive List seems dead on arrival with critical stakeholders promising to ensure it does not see the light, writes TONY AKOWE

The minimum wage is as old as the International Labour Organisation (ILO), which was founded in 1919. The 1919 ILO Constitution, in its preamble, notes the importance of “the provision of an adequate living wage”. In its 1944 Philadelphia Declaration, the ILO called for “a minimum living wage to all employed and in need of such protection”. The declaration states that one of the objectives of the ILO was to ensure that member states put in place “policies in regard to wages and earnings, hours and other conditions of work calculated to ensure a just share of the fruits of progress to all, and a minimum living wage to all employed and in need of such protection”.

Also, the ILO Convention 26 of 1928 put in place mechanism for fixing minimum wage by countries of the world. In Nigeria, the minimum wage has been in force since June 16, 1961. According to the ILO website, Nigeria remains one of the countries in Africa yet to ratify the ILO convention on Minimum Wage. African countries that have ratified the convention are Zambia, Niger, Morocco, Libya, Kenya, Egypt, Cameroon and Burkina Faso. Conversely, countries like Germany, Russia, Switzerland (where the ILO headquarters is located), Sweden, Norway, United Kingdom, United States of America (often used as example of countries where states decide their minimum wage), Canada and China among others have not signed or ratify the convention. But nearly all European countries have a fixed minimum wage pattern. Available records on the ILO website revealed that about 98 percent of the countries in the Americas and about 90 percent of African countries have a fixed national minimum wage.

One of the recommendations of participants at the 2014 National Conference put together by former President Goodluck Jonathan was that “the National Minimum Wage, as currently provided for in the Constitution of the Federal Republic of Nigeria 1999 should remain on the Exclusive Legislative List, while all stakeholders, including state governments should avail themselves of the tripartite framework for determining the minimum wage to ensure ownership and acceptability”. Nigeria Labour Congress (NLC) President Ayuba Wabba said the minimum wage in the United states of America was increased by former President Barrack Obama from 10 to 15 dollars per hour, while states are allowed to peg what they pay which must not be below the national minimum of 15 dollars per hour. He also argued that President Joe Biden has promised to increase the template from the current minimum and wonder why Nigeria will seek to take that right away from Nigerian workers.

While debate on the minimum wage in Nigeria has often centred around the ability of states and Federal Government to decide what they can pay to their workers, not many has given recognition to workers in the private sector as possible beneficiaries of the minimum wage. Labour has often argued that if states are allowed to legislate on the minimum wage, who will legislate for workers in the private sector? This explains why the issue of minimum wage has be retained in the exclusive list over the years. Those who want the issue removed from the exclusive list believe that state chapters of the NLC and TUC should be allowed to negotiate with their state government on what they can pay. But labour has argued that there was nothing compelling states to pay the same wages with the federal government. They argued that the idea of a minimum wage is to set the template on which no state should go below, but can pay above. Labour argued that while some states were paying N18,000 as minimum wage, the Edo state government under former Governor, Adams Oshiomhole and current governor, Godwin Obaseki were paying N25,000 as minimum wage. Labour leaders have also argued that if states prioritise what projects they embarked upon, they will be in a position to pay. Many states, they argued have often embarked upon what they described as white elephant projects and projects that are not economically viable to the state. They question the rationale behind states like Nasarawa who are complaining of lean resources building a cargo airport when they have three airports in Abuja, Makurdi and Jos surrounding them, with two of them under-utilised.

But the sponsor of the bill to delist minimum wage from the exclusive list, Garba Mohamed Datti, believes that the issue of minimum wage should not be a federal legislation only, but that states should also be allowed to legislate on the issue and decide what they can pay to their workers. But he is not conscious of the argument of organized labour that if wages of political office holders can be fixed centrally by the Revenue Mobilisation, Allocation and Fiscal Commission without the process of collective bargaining, there was no reason to allow states decide what they will pay to workers. Many however believe that if the legislation is allowed, it will defeat the very essence of the ILO convention on minimum wage for workers, which provides a benchmark for the lowest wages to be paid to every worker, both in public and private sector.

Justifying why states should be allowed to legislate on what they can pay to their workers, Datti Mohammed admitted the issue of the minimum wage and attempt to situate it properly has always been controversial, many states have not been able to implement the national minimum wage because it was imposed on them from Abuja. He argued that the agreement to pay N18,000 as minimum met with vehement opposition by many of the states who insisted they did not have the resources to pay, adding that “while some of them had not been paying, the national minimum wage was raised to N30,000 again with many states vehemently opposing it”. He insisted that there was no propriety in the Federal Government imposing a national minimum wage when the resources available to the Federal Government are at variance with those available to the states or each state.

To him, “the resources available to the states also differ and while some states may be able to afford the national minimum wage, others may not. Within the states, the resources available to the local government councils also vary but they are also subjected to the national minimum wage. The governor of Ebonyi State alleged that the local governments would need to borrow N1 billion to service salaries while some states allege that they would spend 100% of their earnings to pay salaries. He believes that several socioeconomic variables can be advanced for why the states should be allowed to legislate their own wages. He said “these are usually the factors that determine what is appropriate as minimum wage. In the United States, minimum wage is a concurrent subject matter such that in 2018, the minimum wage in 29 states was actually higher than the federal minimum wage. This scenario is also not unlikely in Nigeria as certain states appear to have the capacity to surpass the federal minimum wage”.

He has supporters in some of his colleagues, Nkem Abonta (PDP, Abia), the bill was very progressive and forward looking, describing it as one of the finest bill in the House, while Hon. Fred Agbedi argued that states should be allowed to fix their own wages because the federal law has not been obeyed by several states. Agbedi believe that once the issue is transferred to the concurrent list, states will pay their workers’ wages commensurate to their resources. Both Abonta and Agbedi said in an era when Nigerians are canvassing for devolution of power, it will not be ideal to allow the federal government to continue to legislate for the states on the issue of minimum wage. Hon. Babajimi Benson also believe that the bill when passed will bring freedom to the states to determine wages for their workers, adding that workers in Lagos should not be earning the same wages with those in Zamfara since both states don’t have the same amount of resources. Hon. Sada Soli described the bill as progressive, dynamic and contemporary in nature, adding that every jurisdiction should be allowed to determine what they can pay as wages, adding that doing so will strengthen the economies of the states and promote peaceful coexistence. Hon. Ben Mzondu said the only way to build an egalitarian society was to allow the legislation to pass, pointing out most states spend the resources available to them to pay wages, adding that it will be out of place to describe the bill as anti-people.

But Deputy Speaker and Chairman of the House adhoc Committee on Constitution Review, Hon. Ahmed Idris Wase, is not comfortable with the bill describing it as anti-workers. The Deputy Speaker said states should not allowed to determine the minimum wage as most states will take advantage of the situation to pay the workers’ wages that will not take care of their interest. He based his argument on the constitutional provision that the welfare of the people is the responsibility of government adding that even when the states have the resources to pay, many states have resorted not to pay workers’ wages due to them. Wase’s argument is backed by Hon. Aminu Suleiman (APC, Kano), himself a former labour leader who dismissed the argument that many states in the country cannot afford to pay the current minimum wage. He said the inability of states to pay is not as a result of lack of resources, but because the states have refused to prioritise. Suleiman who expressed shocked at the volume of support the bill was getting from members said it the states have not been progressive minded and embarks on what he described as white elephant projects which are capital intensive and often abandoned. He maintained that the idea of a national minimum wage is to set parameter for states to negotiate with their workers. He said “if we pass this law, we will be giving states the latitude to whatever they want. We should have the security of the workers at heart”.

The Chairman of the House Committee on Army, Hon. Abdulrazak Namdas, said: “If we pass this bill, we will one day bring another bill to set it aside because the states will abuse it.”

The passage of the bill for second reading led workers to take to the streets across the country in protest. They cast aspersion on the sponsor of the bill, calling him unprintable names. Posters have been posted across Abuja and Kaduna and some major cities of the country describing him as a dishonourable member. One of the posters reads “the evil man against Nigeria workers. He is sponsoring a bill to remove minimum wage from the exclusive legislative list. He was hired by Governor El-Rufai of Kaduna state for this evil job.” It also said “Garba Datti: the dirty man says Nigeria workers wage is too much while the wage in the House of Reps is too small”. Another one reads: “Enemy of Nigeria Workers. Dirty man for dirty jobs, he wants minimum wage removed from the exclusive legislative list. He says workers don’t deserve a national minimum wage”.

While presenting their protest letter to the National Assembly, Wabba accused nine governors across the country as major sponsors of the bill because they have refused to pay the N30,000 minimum wage to workers in their state. Wabba said the bill was not acceptable to both workers and the Nigerian people.

He said: “The issue of National Minimum Wage is a standard set by the International Labour Organisation (ILO), the first agency of the United Nations (UN). So we have the powers of the UN. The National Minimum Wage is not a Nigerian standard. It is an international standard. Their argument is that because they want federalism, they want the issue of the National Minimum Wage to be removed to the Concurrent List. That is false. In the countries of the world, we have 26 federal nations that have minimum wage in their Exclusive List, including the United States. As I speak to you, the minimum wage of America is $10 per hour. President Joe Biden came in and the first statement he made was that he is going to review the national minimum wage.”

They got some assurances from the leadership of the National Assembly to ensure that justice is done. While House Leader, Alhassan Ado Doguwa told them to begin an advocacy and lobby lawmakers ahead of the public hearing on the bill, Senate Deputy Chief Whip, Abdullahi Sahabi said since the circumstances that led to the National Assembly killing a similar bill during the 8th Assembly has not changed, the Senate will ensure that the bill does not succeed.

“I want to say very clearly that in the past, we have stood toe-to-toe with Nigerian workers. There is nothing that suggests we are changing from that direction. Rather, we will stand by you to ensure that the fundamental right of every worker is not only enforced, but ensured and guaranteed. I want to guarantee you that you should not go home having any fear. Go home and sleep with your eyes closed. We are going to ensure that we do justice to the message you have brought to us. Action speaks louder that voice. Wait to see the action. I want to assure you that our colleagues will receive this message in full measure without any subtraction or addition.

On his part, Doguwa told the workers that the only justice that can be done to the bill was to kill it. He told that “We are your employees. By implication, we have no reason whatsoever to shy away from the interests and yearnings of Nigerian workers. When you are happy, we are happy. From what I am seeing now, it is clear that organised Labour is against that bill. We will still invite you to engage with the relevant committees.”

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