Former Minister of Works, Babatunde Fashola has called for significant adjustments to workers’ incomes to counter the soaring cost of living.
Fashola, former Governor of Lagos State, emphasized the necessity for wage adjustments in his article titled “Minimum Wage Review – My Take Away.”
Fashola argued that both the lowest and highest income earners are adversely affected by the current economic climate.
“When the cost of living rises as it has now, all income earners are impacted to varying degrees and therefore deserve reasonable adjustments, whether they earn wages or salaries,” he asserted.
Critically, Fashola highlighted a flaw in the National Minimum Wage Act 2019, specifically Section 4(1)(b), which exempts establishments with fewer than 25 employees from adhering to the minimum wage requirement.
He questioned the efficacy of such legislation in protecting the most vulnerable workers, who are often employed by small businesses.
“The exemption raises serious doubts about whether we have truly enacted a minimum wage law,” Fashola remarked.
Furthermore, Fashola scrutinized the constitutional powers of the National Assembly regarding wage legislation.
He noted that Item 34 of the 1999 Constitution, as amended, allows the Assembly to prescribe a national minimum wage but does not extend this power to monthly salaries.
“The Assembly may have overstepped its bounds by setting a monthly minimum wage of ₦30,000, as their authority pertains to wages, typically understood as hourly payments,” he explained.
Fashola proposed that Nigeria must decide on a proper minimum wage system, potentially revising Item 34 to include salaries.
He suggested this could pave the way for a more comprehensive approach to employee compensation, potentially boosting national productivity and economic prosperity.
The ongoing struggle over the minimum wage has led to significant industrial actions.
On June 3, 2024, the Organised Labour declared an indefinite strike, shutting down critical sectors like airports, hospitals, and power grids.
They argue that the current ₦30,000 minimum wage is insufficient in light of rampant inflation and the economic impacts of recent policy changes, including the removal of fuel subsidies and unification of forex windows.
Despite initial demands from Labour for a ₦615,000 minimum wage, negotiations saw a gradual reduction in their demands to ₦250,000.
In contrast, the government’s offers started at ₦48,000 and only reached ₦62,000 after intense deliberations.
The failure to reach an agreement led to continued tensions and a temporary relaxation of the strike after promises from the government to re-engage in talks.
President Bola Tinubu, addressing the nation on Democracy Day, has reassured workers that an executive bill on the new national minimum wage would soon be submitted to the National Assembly.
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