Re: NLC and Minimum Wage: The Task Ahead



Dr. Peter Ozo-Eson, NLC Director of Research sent a response to my piece on NLC and Minimum Wage: The Task Ahead. Below is the response and my reply to it. Not sure the level of Dr. Ozo-Eson distribution. But do hope he will be broad-minded to be able to share my reply to all those he sent his response to. Above all, I do hope the discussion with Dr. Ozo-Eson contribute to shaping NLC’s strategic response to the challenges facing our dear nation, which the minimum wage is just a small expression. –Salihu Lukman

: NLC and Minimum Wage: The Task Ahead
A Response to Salihu Moh. Lukman
By Dr. Peter Ozo-Eson
NLC Director of Research

An article titled “NLC and Minimum Wage: The Task Ahead” has recently been circulated by Salihu Moh. Lukman. The said article is claimed to be a reaction to a press release issued by the President of the Congress on the issue of the constitutional provision for the enactment of a national minimum wage and attempts to amend it.

Rather than focus on the arguments for and against the amendment being debated, Mr. Lukman went on his usual tirade of seeking to run down the leadership of the Congress. On a number of occasions in the past, he had embarked on this same limelight seeking and self serving mission, but Congress had decided to ignore him as he was not really anybody of consequence. In the process leading to the fuel price increase in 2011, he played all manner of behind the scene games of trying to undermine the NLC’s opposition to the planned increase. In the course of hearings on the issues proposed for constitutional amendment, flaunting his new credentials as consultant to the Governors Forum, he made puerile arguments as to why some states cannot pay the minimum wage. He also had, shortly after the end of Comrade Adams Oshiomhole’s tenure as President of the Congress, issued a statement in which he berated the comrade and sought to run him down.

His present article clearly demonstrates that he lacks knowledge and understanding of the theoretical underpinnings of national minimum wages and even the empirical information of the process and mechanisms for the setting of the minimum wage in Nigeria. While he was a staff of the Congress, he was not involved in the formulation of positions on this matter and the negotiations which preceded the setting of the minimum wage. Unfortunately, illusions of grandeur would not allow him seek available information and knowledge on the subject matter.

According to him, “there is certainly both conceptual and empirical problem with respect to the framework for minimum wage legislation in Nigeria”. In terms of concept, it is important to focus on the rationale and logic of a minimum wage. The basic rationale for the fixing of a minimum wage is to ensure that employees, particularly the unorganised and unskilled, are not exploited by their employers to the extent that their pay becomes so that it creates a pool of the working poor. This logic was clearly established in the Harvester decision of 1907 in Australia which established a “living wage” for a man, his wife and two children to “live in frugal comfort”. It is this logic of protecting the most vulnerable and setting a floor below which living standards of workers must not fall that is at the heart of minimum wage theory.

Many other countries followed as illustrated by the following examples:

• In 1909, the Trade Boards Act was enacted in the United Kingdom.
• In 1912, the State of Massachusetts in the United States set minimum wage for women and children.
• In 1938, minimum wages were introduced nationally in the United States as part of the Fair Labour Standards Act.
• In the 1960s, minimum wage laws were introduced in Latin America as part of the programme of Alliance for Progress.

Most countries of the world have since followed these examples. Thus, out of 194 countries reporting in 2011, only 21 10.8 percent indicated that it had no minimum wage legislation arrangement of form another.

Yes, minimum wage is set for all workers and not for government employees only. In fact it is an unfortunate commentary on the state of affairs in our nation that governments, as employers, should be wrangling over whether to pay the minimum wage not. As major employers, they along with major private enterprises, should avail themselves of the framework of collective bargaining to determine wages and conditions of employment. Ordinarily, such negotiated wages would be far above the legislated minimum wage which is meant to protect the most vulnerable workers in areas of the economy where collective bargaining may not be feasible.

With respect to the process of fixing the minimum wage, Mr. Lukman should try to properly educate himself before making comments. Why otherwise would he argue that “the process leading to passage of the 2010 Minimum Wage Act was dictated by the capacity of the Federal Government to pay ₦18,000? The process involved the setting up of an ad hoc Committee, which made recommendations to the Federal Government. The committee was composed of equal representatives of the tripartite partners of government (including the State Governments), Employers’ representatives and Workers’ representatives and was chaired by Justice Alfa Belgore.

The Committee, in carrying out its assignment, called for memoranda from all levels of government, specialized agencies and organisations and analyzed relevant economic data. Among organisations which submitted reports of studies were the Central Bank, NISER and the National Planning Commission. A study was also conducted for the committee on remuneration capacities of Small and Medium Scale Enterprises across the country. The ₦18,000 recommended was the outcome of the synthesis of the various submissions from state governments, the organised private sector, labour and studies on the cost of living and the ability to pay by Small and Medium Scale Enterprises. Mr. Lukman could easily have found this out if he took time to read the report.

This committee made a recommendation to the Federal government, which then submitted a bill to the National Assembly the enactment of which led to the Minimum Wage Act. The model followed derives largely from the ILO Minimum Wage Fixing Convention 131, 1970 and represents best practice globally.

Mr Lukman and those he consults for seem to be confusing the issue of minimum wage protection for the most vulnerable workers with the issue of fiscal federalism. If fiscal financial autonomy were the issue, private firms would not be brought under minimum wage laws anywhere in the world. Yet, our internal study has shown that there are minimum wage regimes in 173 of the 194 countries responding in 2011.

With specific reference to the practice of minimum wage under federalisms, we have examined all countries whose constitutions are federal in the world. There are a total of 26 federal nations in the world. An analysis of the minimum wage jurisdictional typologies in these countries lays hollow the argument of Lukman and his sponsors who are seeking to politicise the minimum wage discourse. Of the 26 federal states, 16, including Nigeria, have the jurisdiction for minimum wage setting exclusively located in the central government. Exclusive jurisdiction resides in the regions or states in 3 countries, while shared jurisdiction operates in 1 country, the United States of America. Information could not be obtained for the newest federation, South Sudan, while 5 countries had no statutory minimum wage.

This analysis shows that jurisdictional arrangement is not an issue of federalism. Rather, it reflects the historical path and efficiency considerations of individual nations. The case of the United States is interesting. Although several states were the first to institute minimum wage legislations, the federal government still came around to legislate a national minimum wage under the Fair Labour Standards Act. Today, though shared jurisdiction continues to exist, the federal minimum wage is binding across all states and states can only set minimum wage levels which are above the federal level.

This point is particularly important for the debate in Nigeria. Those clamouring for a transfer of the subject of minimum wage from the exclusive to the concurrent list fail to realise that even that will not confer autonomy on the states. Once a federal minimum wage is set, no state can set its own minimum wage below the federal level since for matters under the concurrent list, where there is conflict between a federal and a state law, the federal law will override.

Moving the minimum wage to the concurrent list could create an undesirable situation over time where state minimum wage variations across states become a “beggar-thy-neighbour” instrument in seeking to attract economic establishments to locate in states. It is to avoid this type of injurious competition that income tax – be it or company – is legislated on exclusively by the centre. Moreover, a multiplicity of minimum wages will serve to create a segmentation of the labour market, which could weaken national economic cohesion.

While we do not begrudge Mr Lukman the right to choose whose interests to serve, we wish to advise him that running down organisations and others is not the way to crave attention. Nevertheless, we continue to wish him well.
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Response to Dr. Ozo-Eson

NLC and Minimum Wage: The Issues

Salihu Moh. Lukman
[email protected]

The response to the piece on NLC and Minimum Wage: The Task Ahead by Dr. Peter Ozo-Eson is to say the least a confirmation that NLC positions are “driven by large dose of intellectual and organisational indolence” as argued in my article of July 3, 2013. All that Dr. Ozo-Eson laboured to state was that “Mr. Lukman went on his usual tirade of seeking to run down the leadership of the Congress”.

The evidences are: First “on a number of occasions in the past, he had embarked on this same limelight seeking and self serving mission, but Congress had decided to ignore him as he was not really anybody of consequence”. Secondly, “in the process leading to the fuel price increase in 2011, he played all manner of behind the scene games of trying to undermine the NLC’s opposition to the planned increase”. Thirdly, “in the course of hearings on the issues proposed for constitutional amendment, flaunting his new credentials as consultant to the Governors Forum, he made puerile arguments as to why some states cannot pay the minimum wage.” Fourthly, “he also had, shortly after the end of Comrade Adams Oshiomhole’s tenure as President of the Congress, issued a statement in which he berated the comrade and sought to run him down.”

The judgement passed by Dr. Ozo-Eson after examining all the evidences was that the article NLC and Minimum Wage: The Task Ahead “clearly demonstrates that he lacks knowledge and understanding of the theoretical underpinnings of national minimum wages and even the empirical information of the process and mechanisms for the setting of the minimum wage in Nigeria”. To confirm that, Dr. Ozo-Eson asserts that “while he was a staff of the Congress, he was not involved in the formulation of positions on this matter and the negotiations which preceded the setting of the minimum wage. Unfortunately, illusions of grandeur would not allow him seek available information and knowledge on the subject matter.”

It is important to start by submitting that I make no claims to being an authority either with reference to educational qualifications or experience in every respect. The article under reference makes no such claims. All that was done was to highlight realities supported by indices from authoritative sources, which should guide the process of minimum wage fixing in Nigeria. The central issue in the article was the argument that the process of passage of the 2010 Minimum Wage Act was dictated by the capacity of the Federal Government to pay the N18,000.

It is gladdening to read from Dr. Ozo-Eson’s response that “the process involved the setting up of an ad hoc Committee, which made recommendations to the Federal Government. The committee was composed of equal representatives of the tripartite partners of government (including the State Governments), Employers’ representatives and Workers’ representatives and was chaired by Justice Alfa Belgore.” This should mean that there was some evaluation of capacity to pay based on indices. This is where would expect some demonstration of good scholarship. Unfortunately, beyond the personalised attacks and name-calling, there was none.

Being the Research Director of NLC, it is well below expectation to reduce the debate to simple demonstration of loyalty to the leadership of Congress. I am pretty conversant of the schedules of Dr. Peter Ozi-Eson as the Research Director and would expect that he played the role of a leading guide to the NLC leadership during the process of negotiating the passage of the 2010 Minimum Wage Act. Given that he is an economists who rose to the position of an associate professor, he should be regarded an authority on issues of wage fixing. The sad thing is that reading through his response, cannot but be worried about the fact that he has collapsed to elementary reasoning. If what he wrote was credited to some of our political leaders in NLC who flaunt commercialised Doctoral or self-professed “Professorial’ credentials, would understand. But coming from a seasoned academician with good research capability, this is simply scandalous.

This much said, I will try and highlight the issues so that we don’t reduce the debate to personality assessments. My article of July 3, 2013 was prompted by a media report where Comrade Abdulwaheed Omar, the NLC President argued that amending Part I, item 34 of Second Schedule of the 1999 Constitution “will unnecessarily expose Nigerian workers, especially those in the -income bracket with grave implications for security, productivity and national well-being, as most state governments if given the latitude, will pay wages as as one thousand Naira per month in spite of the relative enormous resources available to them.”

What is very clear from the position expressed by Comrade Omar was that state governments would pay wages “in spite of the relative enormous resources available to them”. I argued that this position is weak and erroneous and supported my position with facts as provided by CBN. The facts are:

No doubt, with reference to our recent past as a nation whereby the total annual revenue of government was in the region of N2 trn, current levels of N8 trn is relatively “enormous”. The critical reality however is that this increase in revenue is not shared proportionately. On account of what can we regard states like Ebonyi and Nasarawa as enjoying “enormous resources” with less than N4 billion monthly from the Federation Account, while states like Akwa Ibom and Rivers receive more than N20 billion monthly. Perhaps with reference to a personnel cost of approximately N500 million for Ebonyi and Nasarawa, the argument for “enormous resources” may be sustained.

This financial profile is almost -enforced by IGR profile of these states. Based on CBN 2010 Report, Akwa Ibom is reported with more than N1 billion monthly IGR and Rivers close to N5 billion monthly. Contrastingly, Nasarawa and Ebonyi were reported with less than N200 million monthly IGR. Now what will be the logic of equating the pay of workers in Akwa Ibom and Rivers with that of Nasarawa and Ebonyi?

With monthly personnel cost of approximately N500 million and monthly IGR of under N200 million, a situation where FAAC receipt crashed can be better imagined. How then can anyone be making a case for wages based on such a loose foundation?

I want to go a step further by inviting the NLC to consider the case of Edo with monthly personnel cost of about N1.42 billion. This is pre 2010 minimum wage. Current levels will be somewhere in the region of N1.7 billion. In June 2013, Edo State got N1.9 billion as its FAAC share. Based on CBN 2010 report, Edo has IGR of slightly above N1 billion. This means that Edo has total revenue of about N3 billion monthly based on which nearly 60% goes to settling personnel cost. Edo state reality represents virtually the situation of all our states with the possible exception of Lagos and Rivers.

It could be tempting to argue that this reality does not exist. This will be suicidal. Should there be any adverse situation in the international oil market affecting oil revenue and the share to states, many states will not be able to meet their personnel cost. One of the issues that Dr. Ozo-Eson knows very well but avoided it completely in his response was the issue of wage fixing. All that appear to be appealing to Dr. Ozo-Eson and NLC was the historical evolution of minimum wage. For clarity, I never contested the existence of minimum wage.

My argument is that revenue capacity of employers should be the guiding consideration and not some pedestrian and unscholarly analysis of countries that are implementing minimum wages. The logic of minimum wage cannot be faulted. The main problem in our case in Nigeria is that once the federal government, with reference to its revenue of over N8 trn annually can pay the N18,000 minimum wage, we imagine that the remaining task is to harass state governments and all other employers in the country to pay.

For the federal government, the minimum wage of N18,000 only represented an increase of 1.15% in its personnel cost. This represent an absolute increase of N11,054,309,926 on personnel cost of federal government, which means an increase from N961,118,726,036 to N972,173,035,962. Increase of 1.15% was made possible because at the time of negotiations, the lowest paid federal government worker was earning around N17,000. Unfortunately, the lowest paid worker in most of our states and other sectors were still earning the then legislated N5,500 minimum wage. For whatever reasons, largely political coinciding with the buzz of the 2011 electioneering period, the reference for a new minimum wage legislation in the country became federal government.

The question I expected Dr. Ozo-Eson to answer will be how does a minimum wage of N18,000 relate with wage determining variables such as the value of marginal of labour for state governments and other private employers. For an economists with the knowledge, experience and if I may venture to add level of pay of Dr. Ozo-Eson missed such an important component in his analysis would appear to be deliberate aimed at misleading NLC leadership and Nigerian workers. Such an approach can only produce false expectations and consequently result in dashed hopes.

There is the attempt to resort to cheap blackmail and presenting my position as if I am opposed to minimum wage. To the contrary, I am for minimum wage fixing. Desirably, this should happen at federal level but given a reality whereby combination of authoritarian and rent-seeking factors have dominate the process of governance in Nigeria, one of the best ways of injecting rational consideration is to decentralise the framework for minimum wage fixing. There is nothing wrong with that and it will be consistent with ILO framework.

In fact, the legislated N5,500 that was reviewed upward to N18,000 with the passage of the 2010 Minimum Wage Act, had a provision that stipulated federal government minimum wage at N7,500. This was not a secret. It was a mark of intellectual laziness on the part of NLC leadership to miss this convention.

Dr. Ozo-Eson may wish to explore other deeper intellectual debate around issues of how higher minimum wage can facilitate employment or produce unemployment. Issues of labour market structure, competition, etc. may help highlight all our options. Certainly, the varied nature of the labour markets across the country does not support a high minimum wage of N18,000. Given high levels of poverty, low minimum wage would also be counterproductive. There is therefore the need for a good balance taking into account issues of labour market structure, capacity to pay and the challenge of tackling incidences of high unemployment in the country. They are all interconnected and poor handling could create disequilibrium with adverse consequences.

The other issues are the personalised attacks and sincerely, I have no apology for my position and it is unfortunate that Dr. Ozo-Eson think the debate about minimum wage in Nigeria based on the challenges of today can be reduced to name-calling. I am grateful to Nigerian trade union leadership for giving me the opportunity to serve and I did so with the full conviction that Nigerian workers represent a progressive category. With a rich tradition embodied by organisations such as Nigeria Labour Congress, I was proud to be part of the community of progressive Nigerians.

In all these, Comrade Adams will always have a special acknowledgement. One thing that was very unique was the fact that our relationship with Comrade Adams up to the end of his tenure, and for me till today, was not sycophantic. It is a relationship of respect based on capacity to speak the truth. In line with that tradition, in March 2007, I wrote an article, which for the avoidance of doubt, I will reproduce below. After the article, I have had further engagement with Comrade Adams, but at no time did he accuse me of attempting to run him down, as Dr. Ozo-Eson is alleging. I am ready any day, anytime to defend myself, but I need details of the charges.

I will kindly appeal that the charges should specify details of the “number of occasions in the past”, I “embarked on this same limelight seeking and self serving mission”, which Congress decided to ignore me. Being “not really anybody of consequence” and one that respect the NLC and its leadership, I will try and defend myself. Dr. Ozo-Eson made claims that “in the process leading to the fuel price increase in 2011”, I played all manner of behind the scene games of trying to undermine the NLC’s opposition to the planned increase”. This is weighty.

To the best of my knowledge, sometime around September 2011 when the issue of removal of subsidy became public, together with Comrade Salisu N. Muhammed and Dr. Timi Agary, we developed engagement template to facilitate consultations across all the stakeholders including labour. Our strategic thinking was that what is required is consultation which should lead to negotiating the whole downstream situation that is producing a cycle of policy announcement – opposition protest – negotiations. In our reasoning, we felt the need to produce a new reality of policy negotiation – agreement – announcement – implementation.

In order to achieve that we came up with some activities and approached NLC, TUC, NUPENG, PENGASSAN, NARTO, NURTWN, NECA, PPPRA, NNPC, the Presidency, some civil society organisations to agree to participate in some preliminary activities. The interesting thing was that almost all the nongovernmental stakeholders participated in the activities but none of the government organisations participated. As a result, the initiative collapsed. However, the leadership of NLC, just like all the other organisations were fully briefed about our line of thought, based on which they subscribed and participated. It was an open process and everything was made public. I will challenge Dr. Ozo-Eson to come with all the evidences he has about “behind the scene games of trying to undermine the NLC’s opposition to the planned increase”.

The last issue is that “in the course of hearings on the issues proposed for constitutional amendment,” I flaunted my “new credentials as consultant to the Governors Forum” and “made puerile arguments as to why some states cannot pay the minimum wage.” Since they are puerile, why should it be the pre-occupation of the almighty NLC Director of Research? Why not ask a clerk to respond to expose how childish they are? Where did I flaunt my so-called credentials as consultant to the Governors Forum? To the best of my recollection, it was at the parley between civil society leaders and President Goodluck Jonathan and Comrade Omar was there representing the NLC. It was not a matter that was secret and I canvassed my position as a Nigerian citizen with privileged information, which I shared. Does anyone in NLC expect that our views on matters of national policy must be the same?

This is the trouble when organisations choose to be passive in national policy debate and the only thing they are able to do is to organise strikes against government and employers. Matters of policies and engagement to influence them are not prioritised. This makes strikes the only objective of why organisations like NLC and trade unions exist. With such disposition, NLC need no Research Director with Professorial credentials except if the Research Director is a shop floor activist. This is the sad reality facing Dr. Ozo-Eson and our dear NLC. I never expected compliments from NLC leaders, especially people like Dr, Ozo-Eson who know better.

By the way, sincerely, I want to congratulate Dr. Ozo-Eson for producing his first public statement as NLC Director of Research after about 12 . I remember, when we were consulting and trying to gather supporting information for his employment as NLC Director of Research, one of the criticism against him was that he has no publication credited to him and as the researcher for the Port Harcourt based Centre for Advanced Social Sciences (CASS), he did not produce any research report throughout his tenure at CASS. This was dismissed and our Comrade was given the benefit of the doubt. Twelve after, his research competence is well outlined and his response is an authoritative confirmation.

I make no claims to anything when I was in NLC. I left as Senior Assistant General Secretary and was told if I wait I will be promoted to Deputy General Secretary. That was in October 2006. While in NLC, I had the rare privilege of serving as Acting General Secretary. I left behind programmes and resources. Although, since I was “not really anybody of consequence”, I will argue that whatever anyone in NLC will say about my person today, there is a standard and I challenge Dr. Ozo-Eson to dispute that.

The NLC that we were all attracted to serve was NLC driven by knowledge, openness and democratic debate. It was an organisation with a world of difference. It was an organisation that nurtures the young ones and challenges all functionaries to develop their competence and capacity. This is completely missing in the NLC of today as a result of which its moral authority is weak. The decay in government and society is finding higher levels of expression in our unions and NLC today. On account of which, a top NLC functionary, converted from being part-time President of his union to full-time General Secretary, just so as to continue to remain as NLC official. Another one has recently postponed the conference of his union just so that perhaps hopefully by the next conference of NLC he can return as possibly President.

There is no need to criticise PDP, government or any employer if at the end of the day we have lost our moral credentials. Let no one deceive Nigerian workers about services if the reference point is the same repressive and authoritarian orientation. The truth is that if Comrade Omar and all our leaders in NLC are unable to lead based on the tradition NLC is known for, I have every responsibility as a Nigerian and as someone who has served the movement to be critical so that they can retrace their steps. I have no apology for that. It will be unfortunate if Dr. Ozo-Eson will collapse and join the crowd of cheer leaders at this late hour.

Finally, what is the issue about consulting for Governors? Doesn’t consulting for Governors also imply consulting for Comrade Adams? Yes, I have consulted for Governors and till today, I can happily say that I enjoy the recognition of some of our Governors. It is a relationship that is value driven based on purely my ability to be relevant to the process of strengthening the capacity of governors to deliver services. It is a privilege and I can only continue to enjoy it with good intellectual services. I have no doubt that the day I fall short of their expectations, all relationship shall end. It is true, it is a choice but it is a choice with subsidiary powers unlike the relationship between many of our leaders in NLC on the one hand and government and employers on the other. I will argue that with our relationship with governors, we may be closer to workers than many of our functionaries in NLC and the unions. Calling me names will not change that reality!
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Below is the 2007 Article that I was accused of attempting to run down Comrade Adams Oshiomhole

The Nigeria Labour Congress and the Challenges Ahead

By

Salihu Moh. Lukman
[email protected]

It was Franz Fanon who argued that ‘every generation must out of its relative obscurity discover its mission’. It will fulfil it or betray it. This is true for generations of individuals, organisations, leaders, communities or societies. What defines the mission of any generation would flow from the challenges facing it and in terms of organisations, it would further be shaped by its mandate or objectives.

The debate around the missions of leaders and organisations in the country is so personalised that specification of the mandate or objective of organisations are reduced to some narrow agendas of individual leaders. This is quite problematic and could undermine processes of organisational strengthening and development. While appreciating the role of leaders in the process of shaping organisational priorities and direction, a situation where leaders assume domineering role is authoritarian, no matter how well intentioned, articulated and correctly defined.

Perhaps the thing to emphasise is that organisations are only relevant to the extent that they are able to contribute to addressing the problems of people at any given point. In terms of trade unions therefore they are only relevant to the extent that they are able to redress the problem of injustice in the workplace and ensure improved welfare and working conditions. This is at the core of the discussion of the relevance, effectiveness or even validity of the mission of Nigerian trade unions and in particular Nigeria Labour Congress (NLC).

Since the February 16, 2007 election of the new leadership of the NLC, there are so many expressed opinions about what to expect from the new leadership. Having worked at a relatively high level in the organisation and being privileged to be part of the Oshiomhole team, it is important that one contribute to the discussion by raising issues around what could be the mission of the leadership.

One thing that must be placed in perspective is that external image of any organisation does not necessary depict its strength, capacity or even potential. The image of the NLC today is largely reflection of its role against the deregulation of the downstream sector of the petroleum industry. The capacity of the Oshiomhole leadership to spearhead the struggle against arbitrary price adjustments of petroleum products was the source of its relative popularity.

Although there are contending views about the efficacy of the management of the mass actions led by the NLC under Oshiomhole, one thing that can not be denied is the fact that Adams Oshiomhole was able to provide a high measure of courageous leadership. However, in terms of assessment of contribution of the NLC under Oshiomhole’s leadership towards raising welfare standards of workers, we may have to come to terms with some basic realities. These realities basically call for some humble recognition of the structural limitations and weaknesses that are embedded in the NLC and its affiliates.

One unaccomplished task of the Oshiomhole leadership has to do with the challenge of reinventing the structures of the NLC and ensure that they are efficient and positioned to competently service the needs of unions and workers. A major problem that confronted the Oshiomhole’s leadership throughout the eight-year tenure has to do with the burden of managing ineffective affiliates either on account of fundamental changes in the structures of work organisations in some sectors or having generation of leaders that are alienated from realities facing workers and therefore not able to gauge and service the needs of workers. In fact, if anything, one can conveniently argue that there are cases where unions or at least their leaders are a liability to workers and their expectation for improved welfare and working conditions. In some respect their actions or inactions worsened conditions of workers. Typical example was the case of anti-causualisation struggles and the role of some unions in protecting some management in the steel, hotel and food industry.

There is the big question of internal democracy both within the NLC itself and the unions. One immediate indicator is the fact that constitutional structures of particularly the NLC have not functioned properly, at least since 2001. Virtually all meetings of the NLC, either at the level of the National Executive Council (NEC) or Central Working Committee (CWC) were emergency meetings. As a result regular organisational challenges have suffered. Partly on account of absent of regular institutional reflections around the challenges facing workers and unions, and to the extent of that reflections, assessment of capacity to deliver effective services to workers and unions, it could be argued that the workings of the trade unions and the NLC have suffered stagnation.

Let me also quickly point out that the absence of institutional reflection is also to a large extent a function of the weakness of the Secretariat. Again, this could also be a measure of the unfinished task of the Oshiomhole leadership, but perhaps also compounded by historical factors, which includes conservative retention of a secretariat structure that may not be relevant to contemporary realities and challenges facing unions. But what are these contemporary challenges facing unions?

First, the structures of Nigerian trade unions, which the NLC secretariat reflect, have largely been the outcome of the 1978 restructuring with some slight amendments of the 1996 restructuring. They were therefore structures created based on 1970s work organisations that were largely Taylorian founded around hierarchies and command structures. To some considerable extent, they were also reflections of cold war politics, which incorporated an underlying responsibility for unions to be part of nationalist and anti-imperialist movement. The framework regulating both labour and union administration is similarly influenced by these factors.

Taking the issue of the Taylorian model, the rise of post-Fordist work organisations based on tasks and knowledge since the 1940s in industrialised countries is producing a paradigm shift, which since the 1990s, with the end of the cold war, has been influencing the emergence of giant, less-regulated and knowledge driven work organisations. In the process, many unions and their structures are fast becoming either moribund or incompetent in addressing the problems of workers.

A good reference point would be the case of the rise of what is commonly referred to as new generation banks. In the UBA, for instance, around the mid 1990s, a whole generation of staff were laid off and the new generation of IT driven staff could not just fit into the old analogue National Union of Banks, Insurance and Financial Institutions Employees (NUBIFIE). Related to that is the fact that given that the officers of the union were largely recruited from the old Taylorian industrial structure, the union is not able to address the challenges of workers. One can further prove this very point citing the 2005 agreement facilitated by Ministry of Employment, Labour and Productivity to the effect that management of all the new generation banks should recognise the existence of unions. About 2 after that agreement, the union was not able to take advantage of that agreement and unionise the workers.

Second related issue is the case of private telecom operators and even the challenges of adjusting to NITEL privatisation. The leadership of the National Union of Post and Telecommunication Employees (NUPTE) were found to be grossly incompetent and corrupt in handling the matter leading to their sacking. There is also the case of the so-called senior and junior dichotomy, which is so entrenched most especially in the public sector.

These are issues that would serve as guide in assessing today’s challenges. What perhaps need to be further acknowledged is that these are to considerable extent internal issues. One will argue that one big external issue that appear to have constraint the capacity of unions is the moribund Ministry of Labour, Employment and Productivity. It is moribund in terms of injecting new initiatives that have capacity of strengthening the regulatory framework for the administration of labour and employment relations in the country. Similarly, its officials, like the unions, are also living in the Taylorian age and therefore not able to address challenges associated with the rise of modern knowledge driven work organisations.

With the emergence of civilian government, a critical challenge facing the unions is that of adjusting to the requirement of democratic practices. This issue would appear to be quite desolate particularly when taken in context of the internal operations of the trade unions both at national and at state levels. What is very glaring is that internal union administrations are undemocratic both at the level of the NLC, affiliates, national and state levels. This may be contestable by my colleagues in the trade unions largely on account of instinct for self-defence. However, it needs to be appreciated that democracy is about formal recourse to structures and ensuring that decisions of structures are complied with. I will argue that this is very weak and in the case of the NLC, in the last eight , regular meetings of these structures never held as and when due. If anything, this is in part accountable to inability of the organisation to focus itself to attend to new and emerging challenges and perhaps -organise, -configure or amend its structures.

For those who seek to engage the discussion of challenges before the NLC around personalities, would miss these vital issues. Therefore my position is that anybody interested in locating the challenges facing the trade unions and most especially the NLC and to that extent seeking to influence the agenda of the new leadership, these are indications. Having raised these issues, one thing that should be emphasised is that the capacity of the NLC leadership to address some or all of the challenges would be determined by how it set out to approach key organisational questions, some of which have been identified above. A major determinant would be the capacity of the Secretariat.

From my little knowledge, I fear that the secretariat and its officers will be more concerned with negotiating power issues rather than focusing on developing broad strategic agenda proposals. This is because in reality the powers of the secretariat was greatly reduced not by any constitutional review but on account of having limited capacity to assert itself at the face of a towering and high profile leader in the last eight years. The process for actualising this may take varying forms, from formal to subtle and even crude but informal strategies. In the process, there may be some distractive consequences, including usual leadership personality conflicts and time lost, which as far as I am concerned should be avoided.

One issue that would appear to be very disadvantageous has to do with the fact that there is very little focus on the internal workings of the NLC and the trade unions, except when a national strike is looming. It will therefore be important that if truly we believe in the potency of the union movement to the process of socio-economic and political transformation of our society, we need to subject the internal workings of the NLC and the trade unions to greater national focus and in the process contribute to strengthening organisational capacity. The Umar leadership would find such an approach very helpful rather than the current one of simplistically measuring him up to Oshiomhole, which I would say at this point, is only meant to write him off. I am sure given the right space and with the correct assessment of challenges facing workers, the young leadership has its potential to record its own achievements. The question would be the quality of advice and input.
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Below is the July 3, 2013 article that Dr. Ozo-Eson responded to
NLC and Minimum Wage: The Task Ahead

Salihu Moh. Lukman
[email protected]

Once again the issue of minimum wage is reverberating in the Nigerian media following the consideration by the National Assembly to move it from the exclusive list to the concurrent list in the 1999 Nigerian Constitution. By that proposal of the National Assembly, Part I, item 34 of Second Schedule will be amended to move the sentence “prescribing a national minimum wage for the Federation or any part thereof” to Part II.

The NLC has registered its opposition to this proposal arguing that the “removal will unnecessarily expose Nigerian workers, especially those in the low-income bracket with grave implications for security, productivity and national well-being, as most state governments if given the latitude, will pay wages as low as one thousand Naira per month in spite of the relative enormous resources available to them.” This was contained in a statement by the NLC President, Comrade Abdulwaheed Omar.

While the position of the NLC is very understandable, it is however founded on a very weak and erroneous premise. In the first place there is the implicit assumption that there is relatively “enormous resources available” to all governments and perhaps all employers in the country. Related to that is the apparent conclusion that the “enormous resources” are equitably distributed to all employers across the country, be it public or private.

It needs to be emphasised that minimum wage law is applicable to all employers – private and public. Partly because the process leading to passage of the 2010 Minimum Wage Act was dictated by the capacity of the Federal Government to pay N18,000 should not cover the reality that many employers, including some state governments have been unable to implement the N18,000 minimum wage. This much was acknowledged in the statement by Comrade Omar. This highlights the existence of a problem which may also translate into wiping out some small employers out of business with the consequence of all workers employed by such employers thrown back to the labour market.

There is certainly both conceptual and empirical problem with respect to the framework for minimum wage legislation in Nigeria. While it may be advantageous today for Nigerian trade unions based on some faulty notion of statutory awards that would threatened employment as well as almost proved impossible for unions to enforce, it could be debated that in the long run it may be a disadvantage. Imagine a scenario whereby either price of Nigerian crude in the international market crashed or the market become smaller. If the argument for “enormous resources” is informed by current revenue from oil as determinant for minimum wage and not workers output or production levels, the NLC position with respect to minimum wage is to say the least injurious to Nigerian workers.

The point is, it is wrong to hinge argument for current statutory framework for minimum wage in Nigeria based on a pedestrian belief that there is relatively “enormous resources”. Relative to what? This is the common perception in the country today, which has impacted negatively on productivity and has virtually reduced most Nigerians to rent-seeking behaviours. The dignity of labour and the human person is commonly sacrificed on the alter cheap search for free money. Contractual responsibilities have been reduced to nothing.

It is important to emphasise that relatively “enormous resources” is a perception that is easily justifiable with reference to perhaps current levels of revenue from crude oil and not necessarily taking into account work indices, especially issues of workers output and its contribution to national wealth. Against the background that today, Nigeria earns more than N8 trn annually largely from crude oil, the temptation to conclude that our governments at all levels enjoy relatively “enormous resources” is appealing.

No doubt, with reference to our recent past as a nation whereby the total annual revenue of government was in the region of N2 trn, current levels of N8 trn is relatively “enormous”. The critical reality however is that this increase in revenue is not shared proportionately. On account of what can we regard states like Ebonyi and Nasarawa as enjoying “enormous resources” with less than N4 billion monthly from the Federation Account, while states like Akwa Ibom and Rivers receive more than N20 billion monthly. Perhaps with reference to a personnel cost of approximately N500 million for Ebonyi and Nasarawa, the argument for “enormous resources” may be sustained.

This financial profile is almost re-enforced by IGR profile of these states. Based on CBN 2010 Report, Akwa Ibom is reported with more than N1 billion monthly IGR and Rivers close to N5 billion monthly. Contrastingly, Nasarawa and Ebonyi were reported with less than N200 million monthly IGR. Now what will be the logic of equating the pay of workers in Akwa Ibom and Rivers with that of Nasarawa and Ebonyi?

With monthly personnel cost of approximately N500 million and monthly IGR of under N200 million, a situation where FAAC receipt crashed can be better imagined. How then can anyone be making a case for wages based on such a loose foundation? In many cases, one is tempted to argue that NLC argument as presented by Comrade Omar is driven by large dose of intellectual and organisational indolence. Given that Nigerian trade unions are almost completely absent today in all our national policy debates, they have lost rational reasoning and relied more on grandstanding and brinksmanship as a strategy, which has reduced NLC’s, and of course trade unions’ pre-occupation in the country to dominantly that of organising strikes. Nigerians today hardly hear of NLC and trade unions activities except when strikes are declared.

Logically and historically, this will not be defensible. NLC and Nigerian trade unions have been vibrant centres of first and foremost intellectual contestation which get reflected and manifest in the way union leaders relate with governments. That was the reality that projected union leaders as popular representatives of Nigerian people from the days of Imoudu to more recent eras of Summonu, Chiroma, Pascal and Adams. Unfortunately, that is withering away with the current generation of union leadership. It is a painful reality, which accounts for such faulty and weak arguments with respect to minimum wage. This needs to be addressed urgently.

The point is, elementary analysis would caution about the consequence of adopting a bandwagon framework for minimum wage legislation that is not informed by economic indices that are related to work output. Such a framework can only result in either shortchanging workers in high-revenue states/areas or over-stretching employers in low-revenue states/areas. Certainly, a review of wage fixing theories would highlight these challenges and perhaps dangers.

It needs to be stated emphatically and unequivocally that although there is increased revenue which has resulted in improved financial profile of especially states and federal governments in the country, it has not favourably alter the structure of government finances. The main predictable reasons would be factors of corruption. Besides, given characteristically unstable international oil market, current levels of oil revenue are hardly sustainable and therefore to plot them as determining variables for price indices such as minimum wage with long term implications would be almost suicidal.

Be that as it may, there are certainly challenges that need to be addressed. The challenges border on ensuring that there is in truth “enormous resources” to guarantee higher levels of wages in the country, in the context of which issues of minimum wage can be correctly computed taken all indices into account. NLC should approach this based on a strategy of strengthening its own organisational capacity and not look for easy quick-wins that are not sustainable, which include a faulty constitutional provision such as the provision of item 34, Part 1 of Second Schedule of the 1999 Constitution.

As it stand, item 34 of Part 1 of the Second Schedule is not is not sustainable and could only expose Nigerian workers to greater risks and danger. Being conversant with internal logic influencing leadership thinking in Nigerian trade movement, it is quite worrisome that NLC is approaching these matters less objectively. It has never been the case that workers will get justice on matters of employer/employee relations bordering on pay and entitlements with simple reference to the law. Had that been the case, there would be no need for unions. The business of unions will always be to develop strategies and carry out actions that can result in improved working conditions and better pay. These are issues bordering on workers input to the process of revenue generation. The big worry is when matters of pay and benefits are delinked from these factors, which appears to be the logic of the NLC argument with respect to national minimum wage legislation in Nigeria.

Of course it could be argued that this has been the case, perhaps since the 1970s. That it has been the case does not make it right. What has been the tradition of NLC and Nigerian trade unions is the courage to campaign for what is right especially in relation to workers benefits and welfare. It is a matter that requires good measure of intellectual and political capacity. The position of NLC with respect of minimum wage fixing in Nigeria is weak intellectually and politically unfounded.

Part of the political imperative is the need to engage our national politics in such a way that workers entitlements are not threatened by factors of bad governance which include corruption. This is where the recent NLC scorecard is low especially given the standards that it is known for. NLC’s voice on matters related to our political development as a nation has been very remote. Partly as a result of that, Comrade Adams Oshiomhole had at the TUC Conference on June 21challenged organised labour “to stand up and be counted”.

Union organisation and their political roles on matters of governance are important in this respect. Somehow, it would appear that Nigerian trade unions, including the NLC have vacated their political roles and in the circumstance their capacity to correctly assess national realities and intervene based on rational consideration is weak. In so many ways, Nigerian trade unions and NLC are very lucky to have rich reservoir of and public goodwill on account of which currently leadership seems to be very relaxed.

In summary therefore, the message to NLC and all Nigerian trade unions is that they need to wake up and reconnect themselves with their historic responsibilities. This calls for good initiatives towards organisational strengthening, conscious effort to produce knowledgeable leadership with high integrity and above all high moral standing. Challenges facing Nigerian workers today go beyond provisions. It is more a capacity issue in many respect. A situation where the main business of unions is only strikes with hardly no voice on national policy and governance issues will at best project unions and their leaders as pedestrians and opportunistic, which over the years they have proved not to be.

Nigerian unions and NLC in particular have always been source of hope for our country at very trying period. So far, Comrade Omar and his team in NLC can do much more. Their intellectual, political and organisational capacity can provide much more than what they are give the nation today. The danger is that current leadership of NLC and Nigerian trade unions may be presiding over the systematic demobilisation of Nigerian workers. They need to consciously prevent that from happening.

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