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Workers’ ‘Certain Death’: Labor Union Criticizes Governors for Calling New Min. Wage ‘Unsustainable’

18:44, 9 June 2024

Christina Glazkova

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Nigerian unions said last Tuesday they had suspended a nationwide strike to allow wage negotiations to continue after the country's president, Bola Tinubu, signed a deal with the union on Monday to raise the minimum wage above N60,000 (about $40).

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The Nigeria Labor Congress (NLC) criticized state governors for saying that they are unable to afford the N60,000 minimum wage initially suggested by the federal government, warning that paying an inadequate national minimum wage poses significant risks not only to the workforce but also to the overall national economy.

The NLC urged the governors to reconsider their actions and prevent the country from a "certain death," emphasizing that the economy of the majority of states heavily relies on the salaries of workers.

In a recent statement, the Nigeria Governors' Forum (NGF) asserted that if a new minimum wage of N60,000 is implemented, “few states will end up borrowing to pay workers every month.”

"All things considered, the NGF holds that the N60,000 minimum wage proposal is not sustainable and cannot fly. It will simply mean that many states will spend all their FAAC [Federation Account Allocation Committee] allocations on just paying salaries, with nothing left for development purposes," the NGF said.

The NLC, however, refuted the claim, stating that the FAAC had increased from N700 billion (around $463.6 million) to N1.2 trillion (approx. $794.8 million). The union accused the administration of amassing wealth at the cost of the people.

Sub-Saharan Africa

Labor Strike in Nigeria Suspended for a Week to Continue Discussions on Raising Minimum Wage

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The Federal Government has already raised its proposal to N62,000 ($41), while Organized Labor, represented by the NLC and the Trade Union Congress of Nigeria, has lowered their initial request from N494,000 (about $327) to N250,000 (approx. $165) during the recent tripartite national minimum wage committee meeting held on Friday.

The union noted, however, that it's not about the numbers but about the value of the minimum wage.

"We are not fixated with figures but value. Those who argue that moving the national minimum wage from N30,000 to N60,000 is sufficiently good enough miss the point. In 2019, when N30,000 became the minimum, N300 exchanged for $1 (effectively making the minimum wage an equivalent of $100 or thereabout), while inflation rate was 11.40%. At the moment, the exchange rate is at N1,600 to $1 while inflation hovers at 33.7% (40% for food). This puts the value of the minimum wage at $37.5 for a family of six. This is happening at a time costs of everything rose by more than 400% as a result of the removal of fuel subsidy. This is extreme bad news for the poor," the NLC explained.

The indefinite strike began last Sunday after unions failed to agree with the government on a new minimum wage. Many unions joined the strike, including the National Electric Workers Union. This led to the suspension of electricity supplies to consumers across Nigeria as early as Monday morning, according to local media reports.

The strike was later "relaxed," according to the NLC, but was not suspended in order to continue negotiations with the government.