Minimum Wage Update: Bill passes Second Reading in Senate - as Reps fault Council of State, insist on N30,000 minimum wage

Abiodun Oba

The Nigerian Senate on Thursday passed the first and second reading of the National Minimum Wage Bill of 2019.

The Bill will now be worked on by a Special Ad-Hoc Committee to be chaired by the Senate Majority Whip, Senator Olusola Adeyeye (South West), ahead of its third reading.

Speaking on the Second Reading of the Bill, Deputy Senate President, Ike Ekweremadu noted that due to the importance of the National Minimum Wage, today was the first time that the 8th Senate was suspending its rules to take a First and Second Reading of an Executive Communication.

“Let me congratulate the NLC and all those who have brought this to this point. I would also like to thank my Distinguished Colleagues for the speedy consideration of this Bill.

“This will be the first time the 8th Senate is reading an Executive Communication and suspending our rules to take a First and Second Reading and assigning the Bill to a Committee, all in one day. This shows how committed we are to this issue.

“I believe what we have been saying so far will suffice in guiding the Committee. Just to clarify, the new minimum wage brought to us is set at N27,000. There were news reports of N27,000 for states and N30,000 for the Federal Government, but this is a single national minimum wage of N27,000. Another issue of concern is whether this affects organisations and establishments employing less than 25 persons.

“If this does not affect these people, it means a whole number of people are left outside the minimum wage and that is not right. In most countries, the minimum wage applies to all workers, regardless of the number of people in an establishment. I believe that at the public hearing, we will be able to clarify and sort it all out. We must try our best to reduce the gap between the rich and the poor,” the Deputy Senate President said.

Other Members of the Ad-Hoc Committee include Senator Abu Ibrahim, the Chairman of the Senate Committee on Labour; Senator Shehu Sani, representing the North West; Senator Sam Egwu, representing the South East; Senator Suleiman Adokwe, representing the North Central; Senator Francis Alimikhena, representing the South South; and Senator Binta Masi Garba, representing the North East.

The Committee has been directed to report back to the full Senate Plenary within two weeks.

Prior to the Second Reading of the Bill, Senators weighed in on the proposed National Minimum wage.

“Let me congratulate the Federal Government, the 36 states of Nigeria and stakeholders on this Bill for the increase of the minimum wage from N18,000 to N27,000. Our Civil Servants will be excited about this. It may not be all they hoped, but it is still an improved situation. Nigeria cannot develop without the help of our Civil Servants,” said Senate Majority Leader, Senator Ahmed Lawan.

“It is important that we lend our voice to see to the realization of this Bill. Even though this may not be enough, productivity is sure to increase,” said Senator Shehu Sani.

“We will work hard, but it is important that this does not become another election gimmick. Let the people who should get paid, actually get paid,” said Senate Minority Leader, Senator Biodun Olujimi.

“This increase, to me, is just a little scratch,” said Senator Barnabas Gemade, “I think the Federal Government should be able to pay N30,000 as opposed to N27,000. Let us accelerate the passage of this Bill, it should not be delayed any further.”

Meanwhile, members of the House of Representatives on Tuesday faulted the Council of State for approving N27,000 as the new minimum wage when the agreement reached by the government, organised labour and the private sector was N30,000.

The lawmakers, therefore, expressed their readiness to adopt the amount proposed by the tripartite committee, whose report was presented to President Muhammadu Buhari.

At the plenary on Thursday, the Speaker, Mr Yakubu Dogara, read a letter by Buhari to the legislature, seeking an amendment to the Minimum Wage Act 1981, to reflect a new minimum wage of N27,000.

The President said the amount was proposed by the tripartite committee and ratified by the Council of State.

The letter read, “The purpose of this letter is to forward to you for legislative action a new Minimum Wage Bill to further amend the National Minimum Wage (Amendment) Act, 2011.

“In order to give a new National Minimum Wage of N27,000 per month to the lowest paid Nigerian worker from the current N18,000 per month. Thus, new bill and the amendments contained therein were arrived at after consultations by the Tripartite Committee on National Minimum Wage, which was constituted by me in November 2017 to consider, make recommendations, and advise the government on this issue.

“The Tripartite Committee comprised representatives of the Federal Government, (Nigerian) Governor’s Forum, Organised Private Sector and the Organised Federations of Trade Unions in Nigeria.

“The Federal Executive Council, National Economic Council, and the National Council of State have all noted and approved these recommended amendments.”

Buhari added, “Other highlights of the amendments include: (i) Exemptions for establishments employing less than 25 persons, (ii) five years review period of the Act in consonance with the Constitutional Review for Pensions, (iii) alterations in the amount of fines payable by defaulters on the prosecution.

“Bearing in mind that issue of prescribing a National Minimum Wage for the Federation or any part thereof is within the Exclusive Legislative List of the 1999 Constitution of the Federal Republic of Nigeria (as amended), and listed as item No. 34 of Part 1 of the Second Schedule, it is my pleasure to forward this Bill for expeditious action.”

After reading the letter, Dogara pointed out that the N30,000, which was proposed by the tripartite committee, and which Federal Government said it would pay its workers in the lower cadre, was not reflected in the letter.

The Speaker asked that the bill be gazetted and considered for second hearing same day. He said it would be referred to an ad hoc committee, which was expected to conduct a public hearing on Monday, while the lawmakers would reconvene to pass it on Tuesday.

At the second hearing of the bill, most of the lawmakers who participated in the debate dismissed a N27,000 minimum wage as too meagre, considering the current economic realities.

Several of them also criticised the Council of State its alleged unconstitutional approval of a wage for Nigerian workers.

The Deputy Chief Whip, Mr Pally Iriase, called for the approval of N30,000 wage for workers. He said in part, “The Nigerian worker earns too much less. Go to the market, because of the noise of N30,000, go and price the items today. But now, it is N27,000.

“This bill must be dealt with in accordance with what the tripartite committee came up with. Not even Mr President himself could deny what the tripartite committee presented.”

While saying that “the revenue allocation formula is overdue for a review, the lawmaker charged his colleagues to “stand up for once” in defence of workers.

“Mr Speaker, N30,000 will be what this House will pass. This House should pass N30,000 instead of this rigmarole,” Iriase stated.

Similarly, another lawmaker, Mr Oluwole Oke, said, “I want to observe that no Nigerian worker earns a minimum wage. I’ve tried to compare the minimum wage here with other climes and arrived at an average of N900, assuming the worker works for eight hours. The N27,000 is grossly inadequate.”

Also, Mr Chika Adamu, who noted that an increase in the minimum wage was a welcome development, said, “The N27,000 arrived at is grossly inadequate.”

According to him, the economic indices and the imminent rise in the prices of commodities as well as the move by the Federal Government to impose new taxes as part of its revenue drive, would not make a N27,000 wage realistic.

“This money is grossly inadequate. By the economic indices that we have on the ground, this money will have no value by the end of the year,” Adamu stated.