As Minimum Wage Standoff Looms Large

The current administration has begun a countdown to its first anniversary amidst an unresolved crisis over a new minimum wage. Festus Akanbi, in this report says an unresolved issue of this magnitude will cast a pall over the celebration 

Unless there is a resolution to the lingering dispute over the new minimum wage this week, there is the possibility that the nation may witness a labour strike in the coming week as representatives of the Nigerian workers maintain their hard stance at last week’s meeting with government’s representatives.

The labour had rejected the federal government’s new minimum wage offer of N54,000, proposing N610,000, but which was later scaled down to N500,000 on Wednesday.

As negotiations on the new national minimum wage continues, organised labour on Wednesday shifted ground on its demand from N615,000 to N500,000.

Although the government is still being expected to respond to the latest position of the labour leaders, watchers of the unfolding drama said a good resolution of all the issues before the May ending deadline is not feasible.

Incidentally, the current administration is marking its first anniversary this week, a development which analysts said is being exploited by the labour to register its grievances over the poor state of the economy and the attendant pressure on the Nigerian workers.

Labour union apologists explain that the federal government, on the other hand, hasn’t shown sufficient examples of how to make sacrifices for the country in the face of the current economic crisis.

They believe Nigerians need to cut wastes and divert more money into productive ventures. 

Meanwhile, some analysts believe the labour union may not win the current war, saying their demands show that the union leaders are far from the current economic realities of the federal government, states and the organised private sector. 

According to a Lagos-based analyst, Mr. Fidelis Anumihe, even if the federal government accedes to the N500,000 minimum wage demand of the labour, where will the money come from? 

“Some states are yet to meet up with the N30,000 minimum wage and you are making a case for N500,000. How realistic is this demand?”, he asked .

He argued that “in an economy where many private sector operators are shutting down their companies, are the labour leaders not pushing for more closure and the corresponding job losses?

Nigeria’s headline inflation rate continued to climb to 33.69% in April 2024, its highest since March 1996, up from 33.2% in the prior month. This marks the 16th consecutive month of acceleration in inflation, partly because of renewed weakness in the naira coupled with the removal of fuel subsidies

Observers said it is in the best interest of everyone if an amicable settlement is reached to avoid plunging the nation into another round of a general strike.

The labour argued that the unrelenting spike in the nation’s inflation will make no sense of the new proposal by the government, hence their push for N500,000.

No Going Back

Explaining the position of the labour after the resumed meeting of the Tripartite Committee on Minimum Wage last week, a member of committee representing NLC, Professor Theophilus Ndubuaku, said that labour has maintained a position on its demand and that should the government fails to meet the May 31 deadline to conclude every negotiations there may not be any other notice to government for strike if it fails to keep to the deadline.

The federal government had raised its proposed minimum wage to N54000 which the labour said had been overtaken by events.

The Argument

“We still told them that the ground they shifted was not enough and that they have not started the negotiation because as of now, the take home salary of the lowest paid worker is over N70,000. So, by their own standard we have not started negotiating minimum wage.

“What we are negotiating now is wage reduction because what they are now telling us is that if we walk out from there, if we agree on N54,000, that means we will come out and tell people who are already earning N77,000 that their wage has been reduced.

“We told them that it is not possible for workers to start earning less than what he/she was earning. Is it that there is a reduction in inflation or that the cost of living has improved, or is it that the cost of food has come down?

“Why will they now be negotiating wage reduction? It’s unthinkable, we cannot be involved in this kind of a thing – that labour will sit down and be negotiating wage reduction. On what will it be based? Will it be based on the fact that the money they are collecting now since petroleum subsidy was removed has reduced?

“Or why will they now be talking about wage reduction when even the inflation is going higher and the cost of living is going higher? So, we told them that that it is not acceptable, but then we had to adjourn because we cannot continue to negotiate without the presence of governors, it will not augur well for the Tripartite Committee.

Analysts said the governments, especially at the state level haven’t shown enough seriousness on the issue, especially with their failure to participate fully in the negotiation, a development which Professor Theophilus Ndubuaku alluded to.

“They said they didn’t know why the governors were not there, six of them are supposed to be on that committee. We told them that this is a serious matter because when they refuse to come even if at the end we agree on anything they will say it’s not binding on them because they were not there.

“There was a permanent secretary that represented one governor and the person has no input, so nobody will take decisions on their (governors) behalf when they are not there.”

President Bola Tinubu through Vice President Kashim Shettima, on January 30, 2024, inaugurated the 37-member Tripartite Committee on Minimum Wage to come up with a new minimum wage ahead of the expiration of the current N30,000 wage on April 18.

With its membership cutting across federal and state governments, the private sector and organised labour, the panel is to recommend a new national minimum wage for the country.

During the inauguration of the panel, Shettima urged the members to “speedily” arrive at a resolution and submit their reports early.

“This timely submission is crucial to ensure the emergence of a new minimum wage,” Shettima said.

The National President of the Nigeria Labour Congress, Joe Ajaero, insisted that the position of the labour was arrived at after an analysis of the current economic situation and the needs of an average Nigerian family of six.

He blamed the government and the OPS for the breakdown in negotiation, saying, “Despite earnest efforts to reach an equitable agreement, the less than reasonable action of the Government and the Organised Private Sector has led to a breakdown in negotiations.”