As far back as one can remember the issue of national minimum wage has been problematic both in comprehension and implementation. From the 1981 N125 minimum wage act enacted by the Shehu Shagari government to the present N30, 000 minimum wage law passed by the National Assemby in 2019, there has been no shortage of disputes and industrial unrest.
By 1981, the naira was widely considered a strong currency. A brand new Volkswagen Beetle sold for three thousand naira. A bag of Nigercem cement went for N3. 50k. A meal at any of the country’s universities, that included chicken and fruit at least two times a week, was for 50k. For the organised private sector, the new minimum wage would be difficult to pay even for companies that employed up to 25 staff as the legislation stipulated.
It is common knowledge that employers of labour outside of the organised private sector rarely pay the minimum wage to their workers. Information too is scarce on any prosecution, let alone conviction, arising from non compliance on minimum wage provisions. The result is that at the end of the day, the minimum wage content is effectively a demand to be borne almost exclusively by the three tiers of government.
Nigeria’s labour history shows a regular pattern of contentious implementation of new wage adjustments at the States in contrast with the situation at the federal level. Observers see the huge disparity between the incomes of the federal government on the one hand and those of the 36 states on the other as a source of seasonal industrial unrest in the States. With the lion’s share of 52% of federation income firmly in its kitty, the federal government has no problem paying higher wages approved for workers. The States’ collective 24% share of national revenue has proved insufficient for the responsibilities thrust on them.
Implementation of the 2019 thirty thousand naira minimum wage package has continued to generate workers discontent at the States. The labour unions have expressed dissatisfaction with the compliance of most state governments and issued ultimatum for full compliance or strike action. Investigations revealed that the state chapters of organised labour are demanding the same adjustment rates granted to federal workers. This agitation is supposedly justified on the ground that labour is on the exclusive legislative list and there are no separate minimum wage laws for states. Relatedly, the grade level concept upon which remuneration is graded is definitive and applies to all government workers. For instance, grade level 08 – 10 federal workers got ten thousand naira pay increase whereas many states added between four thousand and five thousand naira for the same category of workers.
The State labour unions have every right to press for better deal for workers. They are in order demanding from the State governments explanation on how they arrived at their adjustment figures. The first step is to continue discussions until grey areas are ironed out. Here, the example of the Anambra State Joint Negotiating Council which had suspended its earlier ultimatum on minimum wage implementation for further negotiation with the state government is commendable.
But time has also come for Labour to look at this issue holistically. It is not enough to negotiate salaries and other benefits with the federal government and expect that it will work automatically across the federation. The States employ the bulk of the public workforce. Accordingly, any agreement signed with the federal government that does not create the capacity for states’ implementation is only a half executed project. It is in the interest of labour for the states to be empowered and financially strong. Except this is done, labour unrest in the States will continue for some time to come.
Organised labour should not just be concerned but should be in the forefront of resolving these two issues. The first is the oddity of having a central labour law that applies to all when States should have their own labour laws. The concurrent right of States to economic jurisdiction ought to be restored without further delay. Secondly, the current national revenue sharing formula is intolerable. It is a shame that this product of military unitarism is still in operation twenty years into the fourth republic. The formula is an impediment to development and industrial peace.
The repeal of these two backward legislations is one area labour must deploy its activism. And it is not a matter for tomorrow. The time to mobilise and pile pressure on the National Assembly is now. States are creaking under the huge economic and social burdens the present system has placed on them. No other body is better placed to drive this change process and no other body will benefit more than Nigeria’s organised labour.