Says new minimum wage will boost economic recovery
ORGANISED Labour agitation for a new national minimum wage has received a boost from unexpected quarters where many have argued that a new minimum wage is not feasible at this time of economic recession. But in an interview with Labour Vanguard, a renowned industrial relations expert and Group Deputy Managing Director, Kewalram Chanrai Group, Mr. Victor Eburajolo, believes the Nigerian economy stands to benefit more from the new wage, contending that Organised Labour is not doing enough to push for an upward review of the national minimum wage.
By Victor Ahiuma-Young & Progress Okpalaeke
AS an employer, how have you been coping with the business environment?
We are just beginning to crawl out of recession and for the last one year or there about, it has been very terrible for manufacturers generally. This is because the country is heavily import dependent. Everything we produce has a lot of foreign input. During this period, it is quite difficult coupled with the depreciation of the Naira. If you have to adjust your prices, there is a limit to which you can adjust. So, most of us for now have been contended with breaking even and hope for better days in the future. Most companies are unable to pay dividends and some out of tradition, are bending backwards just to satisfy their shareholders by paying some interim dividends.
The reason some of us are doing that is to put some money in the hands of the public so that they too can purchase goods and services because the ordinary man in the street does not have much purchasing power. As a manufacturer, if you produce and don’t sell, you have done nothing. But if you sell and you are unable to collect your money it is even more difficult. So it has been a very though time for us in the manufacturing sector. I don’t think it is easy for those who are selling as well because it is the same thing. It is being a very bad time as the value of the Naira has crashed, prices of oil have equally crashed and sometimes, the prices just fluctuate. So planning becomes very difficult.
What measures are you taking to boost your employees’ productivity in the midst of today’s economic reality in Nigeria?
For these group, we have been given out 10kg of rice for almost one year now. The way we have seen it, that goes a long way to boost productivity. We have not reduced salary. So, it will be better for us to make the sacrifice. We are managing to cope but we just hope that we climb out of this recession very soon.
No reduction of staff strength?
That was done about two years ago. Not really cutting of staff’ strength. What we did was what I will describe in Industrial Relations as delayering. Those who are due to retire, were asked to go and all their benefits paid and then some of them who were still considered strong, after retirement, were brought back on contract for service which is renewable every year.
As one who has been in the practice of Industrial Relations for decades, what is your take in the agitation by Organised Labour for an upward review of the National Minimum Wage given the economic situation in the country?
I have always said that respect is the basis for any civilized relationship either between workers and employees or between government and ordinary man in the street. One of the basic requirements of respect is by promising and fulfilling. We agreed that minimum wage will be reviewed every five years, that is the understanding. For goodness sake, at least, let us have a minimum wage committee that will try to explain or make some adjustments so that the workforce will believe that they are not being taking for granted. But for us to just keep quiet about it and not doing anything, I think it is immoral and very, very unfair to the working class of this country. What even bothers me is not that the minimum wage has not been adjusted, but the recklessness of the state governors and those running government. We have workers that have not been paid, you expect loyalty from them, and expect them to come to work.
Don’t you think it is because Nigeria is a federation where the minister has no control over activities of the state governments especially on this issue of non-payment of salaries or retrenchment?
If he has no control, he has some moral responsibilities to call his colleagues to order. He is quiet about those governments that are doing all these things; state government’s parastatals and so on. And he is bringing his hammer down on the private sector. He forgets that in the private sector, if you don’t pay me, you don’t expect me to come to work or expect loyalty from me, and you don’t even expect me to help myself from the job that I am doing. For instance, you have a cook or a house help and you have not paid him or her and you expect the cook to eat once a day. How do you think he or she will eat? The cook will give you the remnant. He would have finished eating in the kitchen before he passed the remnant to you to eat. Let us be practical about this.
What is your advice to employers who are kicking and saying they cannot cope with any upward review of minimum wage now?
What is capitalism all about? It is the exploitation of the working class and employers all over the world except few that are magnanimous and have blood flowing through their veins, behave as a typical capitalist. They will look for all reasons, reasonable and unreasonable not to adjust salary. Take for example, what we are doing here, giving out bags of rice, is subsidy. If we are to add the cost of rice to the salary of the worker, everybody will say that we are doing well. But you know what, when we were about to introduce it, we did a survey. Do you know what some of the workers said? They said don’t adjust our salaries. If you adjust our salaries, our wives at home may not know, the children may not know but the rice will get home.
Right number of employees
If there is a minimum wage today, all the employers will find a way to implement it. It is an adjustment and we will implement it. They don’t want to close down business. Like I always say to employers, when things are good, most of us just go on and enjoy. For me that is bad business. Just the way you are watching your finances and other means of production, watch your Labour.
Have the right number of employees you want on ground, pay them well and you will get the best from them. But when you flood the whole place with workers, you encourage indolence and laziness. I don’t think we should go on like this and say the economy is bad, we can’t do this or that. Those of us who are into manufacturing are the one suffering because the purchasing power of the ordinary man in the street has been eroded. So if we produce, who is going to buy? If the purchasing power of the ordinary man is enhanced, he will buy and we will produce more. If he does not buy, we will suffer and the whole country will suffer.
Do you think Organised Labour is not doing enough to push for a new national minimum wage?
If you ask me, I will say honestly they are not doing enough. It is not just featuring in the press and shouting here or there. No! We manage Labour, if they keep barking and barking, and they don’t bite, do you know what I will do? I will use something to block my ears to stop the noise from disturbing me. But when I know they are going to bite I will sit up. I remember once when I was negotiating with Comrade Adams Oshiomhole when he was still the General Secretary of Textile Union. He kept threatening that they were going to strike. One day, I said ‘Adams”, where you come from, every morning you will see the hunter cleaning his gun, you never heard him shoot the gun one day. After sometime you will begin to wonder whether his gun is real or not. I said why don’t you shoot it one day for us to know that it is working.’
Issue of salary increase
Besides issue of salary increase, one other thing that can help the workers in this country is credit facility. You know whatever the worker needs to buy, he has to look for cash to pay. The workers in this country don’t have any credit facility. The only thing that is guaranteed in the Labour law is salary advance of one month that you pay back in three months. But go to other countries even in Africa, they have credit facilities.
You expect the Nigerian worker to save money and buy a car. For how long? But if there were facilities in the bank for hire purchase and so on, that would give funds to workers at a concessionary interest rate, you will found out that it will boost the economy of the country. Those of us who are selling vehicles, if there was a backing from government and arrangement with the banks, you will found out that workers will buy cars. It would help car manufacturers, it will boost the economy. Go to South Africa, as the graduate picks up his first job along with letter of employment is the facility for buying car with the bank where all the arrangement is made. The worker gets his salary at the end of the month and from source, the employer deducts the amount agreed with the bank and pays to the bank. So, nobody buys fairly used cars in South Africa?