With the recent assent by President Muhammadu Buhari to the National Minimum Wage (repeal and Enactment) Bill 2019 as passed by the National Assembly, this has expectedly thrown open yet another chapter of struggle if not battle for its implememtation by various State Governments across the Federation.
It is appreciable that Mr. President’s assent to the new minimum wage raise law has not only bring to a halt several months of meets, agitations and controversies over an appreciable new minimum wage scale but also a spur for effective productivity on the part of Nigerian workforce.
As prescribed by the new minimum wage Law, its effectiveness commenced on April 18, 2019 according to President Muhammadu Buhari and makes it compulsory for all employers of labour in Nigeria to pay their workers the sum of N30.000, accept a private employer whose workforce is below 25 persons in number.
The Law while exempting persons who are on other kinds of regulated employment, gives workers the right to sue their employers if compelled by any circumstance to accept salary that is less than N30.000 to recover the balance.
The new minimum wage law also mandates the National Salaries, Incomes and Wages Commission and the Minister of Labour to be the Chief and Principal enforcers of the provision of the act. Also, the enforcement and the right to start the implementation of the provisions of the act, including such steps that would be taken gradually under the law commenced immediately.
It will not be shocking that the new minimum wage salary scale will ignite fresh crisis among some State Governors, Labour Movements, Civil Society Organisations and Workers.
Already, some months back, many State Governors have rejected 30% minimum wage but agreed paying N22,500 as the new minimum wage. Reasons being that: ” … we feel strongly that our acceptable miminum wage must be done in such a way that total personnel cost does not exceed 50 percent of the revenue available to each state”. Nigerian Governors warned.
Although Governor Samuel Ortom of Benue State has agreed to pay workers in his State any amount approved by government at centre as minimum wage: “I am known for championing improved welfare for workers”, yet other Governors declined complying with any approval beyond N22,500.
However, the chips are down, the new minimum wage bill has been passed by the National Assembly and the law assented by President Muhammadu Buhari effective from April 18, 2019. States components are left with no option than complying with the new minimum wage law of the nation with immediate effect.
Communicating the need for immediate compliance with the new minimum wage law by State Governors, the National Chairman of the All Progressive Congress (APC), Comr. Adams Oshiomole posited that: “a labourer deserves to be paid as at when due” and reasoned that Governors have no excuse not to implement the new minimum wage.
Pertinently, it is believed that it will go against the law for Governors and private employers under the new minimum wage law to pay workers less than the minimum wage or to falsify payment records.
Also, apart from the law giving workers the right to sue their employers if compelled by any circumstance to accept salary that is less than N30.000 to recover the balance, the law should also state a miximum monetary fine for non-payment per a worker in the private sector and an impeachment fine for defaulting Governors.
Although, the 30 percent mininum wage quest had gingered so much controversies among the tripartite parties and foot dragging by government at the centre to see to the realization of the new minimum wage, questions going rounds are; is the new N30.000 minimum wage in equilibrium with the living wage of an average working family man in Nigeria? Is living wage at the southern, western, eastern and northern regions of the country at par?.
Comparing Nigeria’s new minimum wage with a few other African countries; Egypt as at January 2019 stands at 1200.00, Mozambique as at April, 2018 is fixed at 4150.00, while Kenya as at May 2018 reflects 13572.00, Cape Verde pays 13000.00 January, 2019, Angola pays 2145.10, May 2019 while Nigeria in April, 2019 goes for N30.000.
It is worthy of note that Nigeria’s Minimum wage is calculated monthly based on cost of living calculated by Trade Unions based on inflations and satistical data from the National Bureau of Statistics and other related while Living wage is the actual amount an individual needs to earn to cover the basic costs of living, having at the back of mind that living costs vary in different parts of the country. For instance; there is a different rate for Abuja, Lagos and the rest of Nigeria.
Now back to one of the questions: is national minimum wage at equilibrium with living wage?
Let us marry the new national minimum wage of N30.000 with the current econonic reality (living wage) in Akwa Ibom State.
In a brief assessment (based on assumption), what is it to live on the current minimum wage of N30.000 per a month? Well, if you are a single person earning N30.000 of course you have to pay some intrinsic tax(es), right? that aside.
So your income is N30.000 and your expenditure goes thus:
Mobile phone, assuming you don’t have a home phone, you probably recharge your cell phone
N2000 per a month
Food and personal expenditures: N15.000
Transportation: lets assume you pay N100 to and fro every five working days per a week: N2000
That brings your total monthly expenditure to N27.500, leaving you with N2.500 savings per month.
Not too bad, right? Of course you will make progress in the system, Perhaps. But think about it, you are residing at Abuja where the cost of living vary with Akwa Ibom Ibom State, can you find a place to live for N3000 per a month, can you cover all your personal expenses, like food and clothing for N15000 per a month? In some months sure, but what if you have to purchase a new pair of shoes, hospital bills, attend to extended family needs etc, or maybe you have a family!
So we can all agree that N30.000 is not a huge amount of money.
The consequences is that many civil servants live on loan and credit to pay for what their minimum wage pay job won’t cover. It is a popular believe that a higher or implementation of the new national minimum wage which is ‘minimal in nature’ will help workers stay out of debt to some extent.
In a nutshall, a higer wage could solve a lot of debt problems for workers.
Relatively, the main benefit why governors should pay workers the new minimum wage is that it can increase employee retention, decrease absentism, promote transparency and enhance the quality of work produced.
Whether or not Nigerian Governors decide not to pay their employees at least the minimal new minimum wage, it behooves on them to remember that failure to pay the legally approved amount of N30.000 new national minimum wage can land their governments in hot water.