The ongoing national minimum wage dispute between the federal government and labor unions has alarmed the organized private sectors (OPS) and entrepreneurs.
They assert that their firms would have to shrink as a result of a high minimum wage, should the law be implemented, and that they are unable to pay more than 62,000 naira.
The Labor Union demands a wage of at least 100,000 naira, but President Tinubu has not yet incorporated their suggested salary of 62,000 naira into law.
Remember that the Federation of Informal Workers of Nigeria (FIWON) has stated that it is willing to accept the results of any agreements that may be reached between the federal government and the labor union.
The Director General of NECA, Adeyemi Smatt Oyerinde, has warned that employers of labor in OPS should not be pushed to the wall, as they have already been pushed by the current situation of the economy.
Adeyemi made the warnings during a chat he had with Leadership Newspaper. He added that the negotiation of the wage has become difficult to conclude due to the current economic
situation.
According to Adeyemi, a new minimum wage was the main discussion of the Committee and not a
general salary increase.
The General expressed concern that the negotiation could be the reason why many businesses have left the country, as they could no longer manage the situation.
“In the present circumstances and even before the inauguration of the Tripartite Committee, many businesses have either folded, relocated, or reduced their operational capacity, with consequential effect in job security.
“Thus, the private sector factored in those indices before it agreed to bend backward and make the
62,000 offer. Any figure beyond this will have a consequential effect on job security.
“As far as we are concerned, the Tripartite Committee has completed its assignment by submitting the report to the federal government.
“We are waiting on the President and Commander-in-Chief to do the needful”,” the General said.
Prof. Ife Adewunmi, Professor of Water Resources, Environmental Engineering, and Civil Engineering at Redeemers University, Ede, has also given a different view to the Labor Union’s demand.
The trade unionist and former scholar of Obafemi Awolowo University also stated that he was not in support of the salary increase for now as the case would cause a domino effect.
“Even though I am a trade unionist (I was OAU ASUU Chairman 2008–11) and stood against exploitation of all staff when the university was illegally deducting 7.5% again as pension deduction after it has been removed from the source into PenCom Account. We eventually got part of it back after a non-violent struggle that lasted about 3 years!
“Why I oppose salary increases is the Domino effect of hyperinflation that will follow such increases because the new increase will not go into production but consumption.
“What Labor and Nigerians should insist on is the creation of an enabling environment for increased productivity.
“It is wicked of the government to increase the electricity tariff. The power supply, which is insufficient and epileptic, should even have a reduction in charges! Instead of over-centralization, each state or region should generate the power for the grids of private power companies just as there are different network providers,” the scholar said.
While speaking, the scholar noted that workers from other occupations are waiting for good news to increase the price of goods and services on their path.
“The total formal sector working population is less than 14% of the country. The Iyalojas, commuter operators, artisans, farmers, and even the bukateria operators are waiting to hear the “good news of increased government workers’ salaries to calculate their increase in their goods or services!
“Remember, we are yet to adjust to an increase in fuel pump prices from N165 to N680-900, depending on the fuel station! You also know the proportionate increase in other things, including cooking gas. People are now back to their firewood and charcoal stove era of the 1960s.” The scholar noted.
Adewunmi suggested that the labor union, rather than asking for a salary increase of the minimum wage, should demand social reliefs such as the regular provision of social amenities like adequate subsidized commuter bus services by local and state governments, adequate public water supply, electricity supply, and adequate security to protect farmers engaged in food production.
He questioned President Tinubu’s administration’s promises of hitting the ground running to stop insecurity from cattle herding terrorists and kidnappers and wondered if insecurity had been curbed.
“We need an increase in social security in terms of food, water, energy supply, good roads, and freedom to do one’s job without fear of gun-totting Fulani terrorists camouflaging as herders. These wage wars of hunger on the country so that it will be their own that we will be forced to depend on,” Adewunmi said.
According to Prof. Adewunmi, what Nigerian workers need is a living wage, not a minimum wage.
The President of the Premium Breadmakers Association of Nigeria (PBAN), Emmanuel Onuorah, also said: “Inflation today is 33.95 percent. What does it tell you? For every N10,000 or N1 you earn, about 40 percent of it has been eroded by inflation, and food inflation is going towards 41 percent, meaning that 41 percent of that salary would be used for food.
“For me, I don’t think labor demand is outlandish. It is for everybody to work with their workers in their various industries. For the time being, in the private sector, open the books to your workers. Let him see the books; look, this is where we are as a business; they will appreciate you more for that. You understand that, as a business, I try as much as possible, and I encourage my members to pay a living wage and don’t owe them. So that is it for us.”
The founder and CEO of Tudu Energy, Tuoyo Dudu, has also stated that he prefers the idea of a living wage to a minimum wage. “For me, I am more of a fan of the living wage. The term minimum wage—I find it derogatory, and I guess it is what we used. So, the Labor Union asking for better wages makes lots of sense considering the cost of things right now. As of the last time, the union is asking for N250,000. But I don’t think the N250,000 is realistic based on the economy and on what the government can even pay.
“For me, I think the current minimum wage should be at least N100,000, just based on the cost “of things in the market. Also, the major thing about the law is that, when it is made, whether it is comfortable or not, people have to adhere to it, and eventually, things will adjust.” The founder and CEO of Tudu Energy said.
Dudu noted that if the wage increases beyond what employers of labor can pay, it might lead to jobs being lost. adding that, “But what would also happen is that it would push people to be more productive.”. He suggested that the government should pay a living wage and also create an enabling environment where businesses can thrive.
“So I suggest the government should do two things. Pay a living wage and, at the same time, create an avenue for businesses to thrive in the country, which is power. Nigeria needs power. If we have power, then businesses can sort themselves out, “he said.
Folusho Folajimi, an SME owner, stated, “There is no doubt that the current minimum wage amounts to next to nothing right now as Nigeria’s economy is suffering daily. However, the demands of the labor union if it becomes binding as a national minimum wage cannot be sustainable for SME owners like myself.”
He noted that companies are exiting the country, importation charges of materials keep soaring, and there is next to nothing when evaluating the purchasing power of the average Nigerian.
Nnadozie Peters, who is a small-scale business owner, also has this to say: “Private business owners may pass on the increased labor costs to consumers through higher prices for goods and services. This could potentially affect consumer purchasing power and overall demand in the economy.”
Source: Leadership e-paper
