Uniform minimum wage may lead to job losses, SAN warns

A Senior Advocate of Nigeria, Yusuf Ali, has called for the autonomy of states in negotiating wages with their employees, aligning this with the principles of federalism.

He stated this against the backdrop of the newly approved minimum wage of N70,000 by President Bola Tinubu which was also passed into law on Tuesday by the National Assembly.

Ali argued that the current system of a uniform national minimum wage did not account for the economic disparities between states, which could lead to adverse outcomes such as job losses and financial strain on less affluent states.

Recall that the Southern Governors’ Forum, for instance, has expressed a desire for states to negotiate wages independently, a position that highlights the ongoing tension between regional autonomy and national cohesion in Nigeria’s federal system.

Labour unions, on the other hand, staunchly opposed this move, arguing that it could lead to disparities in workers’ pay and conditions across different states.

The Head of Information and Public Affairs of the Nigeria Labour Congress, Benson Upah, in a statement titled, ‘Governors cannot dictate what to pay’, said governors’ demand to independently set the minimum wage in their respective states undermines the principle of a minimum wage and poses a threat to the welfare of workers as well as the stability of the national economy.

He stated, “Ensuring a fair minimum wage is not only a matter of economic justice but also a fundamental aspect of maintaining social stability and national cohesion. Nigerian workers should not be reduced to beggars.

“It is unfortunate that workers’ salaries are often seen as charity rather than the hard-earned income of hardworking Nigerians. It is equally painful that some of these governors fail to realise that workers’ salaries substantially drive the economy. Not surprisingly, they prioritise their greed over the needs of ordinary citizens.”

Meanwhile, the SAN, in an interview with Saturday PUNCH, emphasised the importance of aligning wage negotiations with the federal structure of the country.

He highlighted that each tier of government employed its workers and should have the flexibility to set wages according to their financial capabilities.

He said, “We have to consider the type of government we run. We all claim that we are running a federal system. In a truly federal system, the parts should have the liberty to negotiate with their workers.

“Capabilities to pay salary are influenced by various factors, including the economy and state priorities. We must find a solution that is workable, sustainable, and that does not lead to job losses.”