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12 Historical review of Nigeria’s national minimum wage

In January 2024, the federal government inaugurated a 37-member tripartite committee to review the National Minimum Wage. As of today, the committee has not agreed on the new rate but, the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC) have given the federal government a deadline of May 31 to develop a new national minimum wage.
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1. Initiation of Wage Reviews:
– Under President Shagari’s administration in 1981, Nigeria saw its first national minimum wage law, prompted by advocacy from the Nigerian Labour Congress.

2. Divergent Views Between Federal and State Governments:

– In 2019, while the federal government approved a national minimum wage of N30,000, some states, like Zamfara, expressed concerns about their ability to afford it.

3. Lengthy Negotiations:
– Negotiations for the 2019 minimum wage started in 2018 and lasted until March 2019 before an agreement was reached.

4. Differing Perspectives on Wage Determination:
– Labor unions, such as the NLC, based their wage demands on factors like inflation and cost of living.
– The government considered the financial capacity of employers, especially states facing economic challenges.

5. Limited Role of Private Sector:
– While the private sector is involved in negotiations, it often takes a backseat compared to labor unions and government representatives.

6. Exclusion of Local Governments:
– Local governments have typically been absent from minimum wage negotiations, despite their role in employing civil servants.

7. Challenges with Realistic Wage Agreements:
– Some states, like Lagos, have implemented wage adjustments higher than the national minimum wage, but others struggle to meet even the current minimum wage requirements.

8. Enforcement Issues:
– Despite provisions in the Minimum Wage Act for enforcement, many states have failed to comply, leading to unpaid wages and labor disputes.

9. State-Level Wage Adjustments:
– States like Edo and Lagos have independently announced new minimum wage rates for civil servants, reflecting varying economic conditions across regions.

10. Historical Context:
– Chief Awolowo’s introduction of regional minimum wage policies in the past highlighted disparities between regional and federal wage rates.

11. Ongoing Negotiations:
– The 2024 discussions for a new minimum wage continue to follow similar patterns of negotiation seen in previous years.

12. Need for Honest Conversation:
– Governor Obaseki’s approval of a higher minimum wage in Edo State and Governor Sanwo-Olu’s implementation of a wage award in Lagos underscore the need for transparent discussions to balance affordability and worker welfare.

However, we are still using similar templates, processes, methods, and negotiation styles to fix the National Minimum wage to what we have used in the past. This raises the question: will we get any better results? Would we get a wage that will make a real difference to workers?
We need to have an honest conversation about the Minimum wage. Do we want to fix any amount as the minimum wage, or do we want a wage that will be affordable to employers and reasonable enough to improve the livelihood of the workers? Until we resolve this question, we will keep fixing minimum wages that many employers will refuse to pay, and even when they pay, the wage will make no difference to most workers.

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