SaharaReporters earlier reported how the Nigerian government approved a N70,000 minimum wage following deliberations with the organised labour.
The newly signed National Minimum Wage that pegs the minimum remuneration of Nigerian workers at N70,000 does not apply to all workers in Nigeria, a report submitted by the Tripartite Committee established by President Bola Tinubu has revealed.
SaharaReporters earlier reported how the Nigerian government approved a N70,000 minimum wage following deliberations with the organised labour.
Although the Nigeria Labour Congress, Trade Union Congress and their affiliates earlier demanded N250,000, it finally agreed to a N70,000 wage, bringing an end to the almost protracted wage dispute.
Senate President Godswill Akpabio had also announced that the newly approved minimum wage would apply to all workers. He said the application of the new law is without exceptions.
He noted that all workers across both public and private sectors, including maids and other domestic staff are expected to benefit from the newly approved minimum wage.
However, a copy of the report submitted by the Tripartite Committee to President Tinubu which Vanguard Newspaper obtained has shown that the Senate President’s remark is not accurate.
The report contains some exceptions, stating that not all workers in Nigeria can benefit from the new minimum wage, considering the nature of work, revenue and size of workforce.
The report said for any business to qualify for exemption from the mandatory payment of minimum wage, the business must fall under a nano business (Business managed by 1-3 persons with capital below N50,000).
Others are micro business enterprise, which has 10 or a smaller number of employees, startup businesses, those with legal or statutory exemption and commission contract.
Others include establishments that have “less than N50 million revenue per quarter or N200 million revenue per annum, organisations with less than 10 staff members, establishments of not more than three years in existence, industries which have their staff remuneration and compensation regulated by other Acts of the National Assembly or any other business which the Minister of Labour and Employment or the Executive Chairman of the National Salaries, Incomes and Wages Commission finds to be reasonably justified to be waived or exempted, provided that such waiver shall not be given unless the reason for its application is based on evidence of lower revenue, insolvency, debt crisis or other justification that threaten the existence of the establishment, which shall not apply to governments or their ministries, departments and agencies”.
Before making its recommendations, the committee noted the exemption of workers in seasonal employment, such as agricultural farmland, as well as the exemption of anyone working on a vessel or aircraft subject to commercial shipping or civil aviation legislation.
The committee also noted that the “formal sector wage pattern: governments, corporate organisations and other organised private sector businesses. The wage pattern in this category is mainly every month. Workers and their employers in this category are usually the focus of the national minimum wage laws.
“There is yet a serious challenge when it comes to coverage of or compliance with, as the case may be, the national minimum wage even amongst this category of employers.
“Therefore, it is difficult to have an accurate assessment of the pattern either because some establishment shortchanges by strategically avoiding the threshold or, in the case of state governments, refusing to comply with the law.”
It pointed out that “the informal sector wage pattern, in which workers do not have any earning yardstick, wages in this sector are multi-dimensional. Compensation and remuneration in this category range from commission, to piece-rate. Some are paid daily after close of business which might be dependent upon daily sales. Some are employed on apprenticeship, to work and learn, while helping to build or grow the business with the agreement to get settlement by taking a share of the business, becoming partners or receiving settlements after some agreed years”.
The sub-committee considered the rationale, justification and objective for excluding organisations from mandatory compliance with the national minimum wage laws based on the number of their employees.
The sub-committee considered that many organisations with supposedly slim workforces earn multi-billion naira in annual revenue, and yet do not on their own volition find it fair to commensurately compensate their junior staff with an amount above the minimum wage standard.
The sub-committee also found that this idea of exemption is even discouraged by the International Labour Organisation, describing it as unfair to the lowest earners of the society.
The sub-committee argues that even if this form of exemption becomes necessary, 25 employees as the baseline for such exemption is unfair and unrealistic.
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