Decentralisation of minimum wage: NLC distorting the facts, Salihu Lukman, DG of PGF alleges

Director-General of the Forum of All Progressives Congress governors, Salihu Lukman has faulted the argument of the organised labour that nations who were signatory to the International Labour Organisation (ILO) Convention, have minimum wage on their exclusive legislative list.

The face-off between the government and organised labour was a sequel to a bill sponsored by a member of the House of Representatives, representing Sabon Gari Federal Constituency of Kaduna State, Honourable Mohammed Garba Datti, seeking to move minimum wage from the Exclusive Legislative List to the Concurrent Legislative List in the 1999 Constitution in line with recommendations of the report of the All Progressives Congress APC.

Both the Trade Union Congress and the Nigeria Labour Congress staged a protest to the National Assembly during the week.

Lukman in a statement on Friday argued that the statement attributed to the NLC that moving the minimum wage from the exclusive legislative list to the concurrent list contravened the provision of the International Labour Organisation (ILO) Convention, which Nigeria is a signatory is a distortion of fact.

The DG of the Progressive Governors Forum maintained that ‘While it is true that ILO Convention No. 30 of 1928 Minimum Wage-Fixing Machinery Recommendation provide the guiding principles for the determination of minimum wages in all countries, nowhere was it stipulated that the process should be the exclusive preserve of federal authorities. Anyone interested can confirm the details.

“If anything, the Convention allows for flexibility for each country to apply the guiding principles to its circumstances through consultative processes that take into consideration all the interests in the country’s labour market. The guiding principle is ‘to ensure that each Member ratifying the Convention is in possession of the information necessary for a decision upon the application of minimum wage-fixing machinery, the wages actually paid and the arrangements, if any, for the regulation of wages should be ascertained in respect of any trade or part of trade to which employers or workers therein request the application of the machinery and furnish information which shows prima facie that no arrangements exist for the effective regulation of wages and that wages are exceptionally low.’

‘Nowhere in the Convention is it provided that minimum wage-fixing is the exclusive responsibility of federal authorities. “

Stretching his argument further,  Lukman submitted that in all federal states that were members of ILO, the issue of fixing wages has never been the exclusive preserve of the central government.

“Experiences of all ILO member countries will further confirm that fixing minimum wages is never the exclusive preserve of federal authorities. Since our model of democracy is United State of America, it should perhaps be the first reference. In US, minimum wage is set by US Labour Law and a range of state and local laws. As at January 2020, there were 29 states and D.C. with a minimum wage higher than the federal minimum. Almost 90% of US minimum wage workers are earning more than $7.25 per hour, which is the minimum wage at federal level in the US. 

“The Federal, States and Counties make laws for minimum wage. Minimum wage for each level is negotiated. Different states are able to set their own minimum wages independent of the federal government. When the state and federal minimum wage differ the higher wage prevails. As of January 2018,  there were 29 states with a minimum wage higher than the federal minimum. Washington, D.C, and New York City have the highest minimum wage at $15.00 per hour. By January 1, 2021, California has the highest state minimum wage at $14.00 per hour, which will be raised to $15 per hour starting January 1, 2022. The minimum wage in New Jersey is $12.00 an hour as of January 1, 2021, but will be raised by a dollar a year until 2024 when it will be $15. Massachusetts minimum wage is $13.50 per hour. A number of states have also in recent years enacted state preemption laws, which exclude local governments from setting their own minimum wage. As at 2017, state preemption laws for local minimum wages have been passed in 25 states.

“Legislation has been passed recently in multiple states that significantly raises the minimum wage. California, Illinois, and Massachusetts are all set to raise their minimum wages to $15.00 per hour by January 1, 2023, for California and Massachusetts and by 2025 for Illinois. Colorado raised its minimum wage from $9.30 per hour to $12 per hour by January 1, 2020. New York has also passed legislation to increase its minimum wage to $15.00 per hour over time, with certain Counties and larger companies set on faster schedules than others. Some smaller government entities, such as Counties and Cities, observe minimum wages that are higher than the state as a whole. 

“The National Minimum Wage in the United Kingdom is set depending on your age, and whether or not you are an apprentice. It has been in place since 2005, and several changes to the way it operates have been made over time. At present, the minimum wage applies to any worker aged 16 or over. However, there are some exceptions, such as people who are working in their employers home, or who are undertaking voluntary work. In these cases, the National Minimum Wage might not apply. For eligible workers aged 25 and over, the minimum wage is known as a National Living Wage. It is expressed as an hourly gross payment, and reviewed every April. For the period April 2017 to March 2018, the National Living Wage paid to employees aged 25 or over, is £7.50 per hour. The National Minimum Wage is set by the UK government. It is reviewed every year, and usually, most categories get an annual increase. However, as the system is quite complicated and based on a number of different age bands, there have been years when employees of certain ages don’t get their minimum pay increased. 

“Some other countries negotiate with trade unions and employers, and agree on what should be the minimum wages. This means that there could be different minimum wages depending on the sector. Belgium, Norway and Sweden work in this way. Other countries have a different way of managing minimum wages. Singapore has minimum wages set by the government, but only across some low income sectors. These minimum wages are applicable to Singapore nationals and permanent residents only – although employers are encouraged to extend them to other workers as a minimum, too. And yet other countries don’t have any minimum wage at all, preferring to leave employers and employees to negotiate on an individual basis.

“Coming closer home, in South Africa and Ghana, minimum wage is determined through negotiations between unions, employers and government. The National Minimum Wage (NMW) in South Africa was increased to R21.69 per hour from March 1, 2021. The 93c increment was announced by Employment and Labour Minister, which is in line with the NMW legislation of January 1, 2019. It is illegal and an unfair labour practice for an employer to unilaterally alter hours of work or other conditions of employment in implementing the NMW. In Ghana, government-mandated minimum wage provides that no worker in Ghana should be paid less then the mandatory minimum rate. Employers in Ghana who fail to pay the Minimum Wage may be subject to punishment by the government of Ghana. Weekly rates per month are calculated 4.33 times the standard hours per week. 

“What all this means is that the process of minimum wage-fixing across the world varies in almost every ILO member country. As much as every federal authority plays an important role in facilitating the process of fixing the minimum wage, it is never their exclusive legislative jurisdiction. How, as a nation, Nigeria arrived at the constitutional provision of assigning minimum wage under the exclusive legislative list is completely not based on the guiding principles provided under ILO Convention 30 of 1928.”

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