Former Minister of Works and ex-Governor of Lagos State, Babatunde Fashola, has underscored the necessity for a fair review of the minimum wage in Nigeria, citing the increasing cost of living across the country.
In a comprehensive statement titled ‘Minimum Wage Review – My Take Away’, Fashola emphasized the importance of ensuring that both low and high-income earners can adequately cope with economic challenges.
“When cost of living rises as they have now, the lowest and the highest income earners are impacted to varying degrees and therefore deserving of reasonable adjustments whether they earn wages or salaries,” Fashola asserted.
Critiquing the current legislative framework, Fashola raised concerns over Section 4(1)(b) of the National Minimum Wage Act 2019, which exempts establishments employing fewer than 25 persons from complying with the minimum wage requirements.
He questioned the law’s efficacy, pointing out that it undermines the intended protection for vulnerable workers in smaller enterprises.
“The exemption of such establishments raises serious doubts about whether we have enacted a minimum wage Act if small businesses…are exempted from the law as currently legislated,” he remarked.
Fashola, a Senior Advocate of Nigeria (SAN), also delved into the constitutional limits of the National Assembly concerning wage legislation. He clarified that while the Constitution empowers the National Assembly to set a national minimum wage, it specifically pertains to wages, not salaries, which are typically paid monthly.
“It seems obvious from this definition that by making a law…that the minimum wage of N30,000 shall be paid monthly, the NASS may have acted unconstitutionally by legislating on a SALARY,” Fashola highlighted.
He urged stakeholders to consider the broader implications of wage policies on national productivity and economic stability, stressing the need for comprehensive reforms and global best practices in labour laws.
The discourse on minimum wage in Nigeria has been contentious, culminating in a recent industrial action by Organised Labour to demand a new wage reflecting current economic realities.
After protracted negotiations, the government and labour unions have yet to reach a consensus, with both sides presenting contrasting proposals.
President Bola Tinubu’s administration has expressed commitment to addressing the issue, promising to present an executive bill to the National Assembly soon.
As the nation awaits further developments, the debate continues on how best to balance the welfare of workers with economic sustainability in Nigeria.