The recent review of the emoluments for our lawmakers has generated an air of optimism among our low and poor-wage earners, rekindling a glimmer of hope that they will also have every reason to celebrate when the new minimum wage is announced in the National Budget on the 28th of this month.
The pay rise for the MPs was ill-timed as it showed a lack of empathy for our workers living in poverty. As I shall attempt to unveil in this article, for far too long our low-paid workers have been denied fair compensation for their labour.
Review of minimum wage
It took almost ten years for the minimum wage to increase from $2 to $4 which is disproportionate to the rising cost of living over the same period.
The minimum wage rate of $2 an hour was first introduced by the FijiFirst government in March 2014 which benefited an estimated 100,000 Fijian workers who were paid between 70 cents to $1 an hour.
Later it was increased to $2.32 in July 2015 and subsequently to $2.68 in September 2017. Thereafter, following a five-year hiatus, the revised rate of $4 came into effect from January 1, 2023. It was implemented in four tranches starting from $3.01 from April 1, 2022, $3.34 from July 1, 2022, $3.67 from October 1, 2022, and $4.00 from January 1, 2023. To a large extent, this is where the problem stems from as I will expound later.
The position of key stakeholders
The Fiji Trades Union Congress has called on the Government to implement a $6 national minimum wage. Its general secretary Felix Anthony said they had, for many years, strived to ensure that the workers were paid fairly and ordinary Fijians were lifted out of poverty (FT 5/5).
The Fiji Commerce and Employers Federation on the other hand has appealed for a cautious approach when determining the new rate, stressing that many enterprises, especially micro, small, and medium businesses, are already operating on tight profit margins and potential cost increases may force job cuts and threaten closure (Fiji Village 17/5). Echoing similar sentiments, the Fiji Hotel and Tourism Association has also called on the Government to re-look at the national minimum wage before approving any changes that will have a drastic impact on small and medium-sized enterprises (Fiji Village 4/6).
The National Federation Party has been persistently advocating for a decent living wage for many years. This stand was clearly articulated in the NFP leader’s opinion published in The Fiji Times on 28/10/2017 wherein he stated: “The dignity and welfare of workers in Fiji can only be improved through the implementation of a decent minimum living wage. If elected to government the NFP will push for a $5 per hour minimum living wage.
“The NFP’s proposal was well thought out based on the cost of living now prevalent in Fiji. A $5 per hour minimum living wage will just be a catch-up on the rise in the cost of living over the last 10 years.”
Right to work and a just minimum wage
The right to a just minimum wage is enshrined under Section 33 of the 2013 Constitution as reproduced below.
33.— (1) The State must take reasonable measures within its available resources to achieve the progressive realisation of the right of every person to work and to a just minimum wage.
(2) In applying any right under this section, if the State claims that it does not have the resources to implement the right, it is the responsibility of the State to show that the resources are not available.
This is further amplified under Article 23 of the Universal Declaration of Human Rights which stipulates that “Everyone, without any discrimination, has the right to equal pay for equal work. Everyone who works has the right to just and favourable remuneration ensuring for himself and his family an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection.” It is therefore obligatory for the government to ensure the new rate is fair and just.
How poor workers have been robbed?
The late Father Kevin Barr resigned as the chairman of the Wages Council in 2012 out of frustration because of the persistent undue interference from the military government which undermined the independence of the council. In his resignation, he wrote … “When we began our work (2008) there had been no increases in workers’ wages for three years. Our first set of wage proposals was due to come into effect on February 1, 2009. Without any consultation, the PM announced that, under pressure from a strong lobby of employers, he was deferring the Wage Regulation Orders to July 1, 2009.
“The second set of wage proposals was then set to come into effect on July 1, 2010, but again was deferred for ten months until May 1, 2011, and was reduced by 5 per cent. All this was done without any consultation with me or the Wages Councils”.
The Wages Council met in early 2012 and approved a set of wage proposals to come into effect on August 15, 2012. Then again, without any consultation, there was an announcement through the media that these wage increases had been deferred until 31st October and the Wages Councils would be asked to reconsider them because of objections raised by some employers.” (Sourced from: “Father Kevin Barr: an enigmatic champion against poverty” by Wadan Narsey).
It is clear from the above that had the increments been gradual and reviewed annually aligning it with the inflationary rate it would not have come to this. Opponents may argue that $6 is unrealistically high.
But it is not if one looks at it holistically. Raising their pay by $2 essentially means putting an extra $73.60 weekly in their pockets. It is to be noted that, unlike other cadre of employees, the pay rise for minimum wage earners is never backdated nor do they ever receive any bonus.
The opportunities for promotion are also very limited. Often non-unionised workers become vulnerable to exploitation such as wage theft, etc.
Relief for SMEs
Of course, the wages of workers close to the threshold would also rise in tandem resulting from the ripple effect from the increase in minimum wage. But that is inevitable. Some are alarmed that any increase in minimum wage will strangle the budding SMEs.
The same view surfaced during the public consultation which saw strong resistance from the business community.
However, in my view, the increase will have a marginal effect as in most cases only a small group of workers will be affected.
As a mitigation measure, the Government could consider setting aside some funds to provide wage subsidies to employers who face genuine hardship in meeting the extra labour cost. Alternatively, the increase can be structured in three phases commencing with $5 from August 1, 2024, $5.50 from January 1, 2025, and $6 from August 1, 2025, to provide some breathing space for SMEs.
They deserve to live in dignity
In the final analysis, when weighing the merits and demerits of the new rate, one must not forget we are talking about the welfare of our lowest-paid workers who are owed a fair recompense for the injustice they have suffered in the past. Just because those on minimum wage constitute a paltry group of unskilled workers does not mean they do not deserve to live in dignity like other human beings.
While speaking in favour of the Special Committee on Emoluments Report on the review of MPs’ salaries, allowances, and benefits the Leader of the Opposition Honourable Inia Seruiratu defended his party’s submission saying they (his members) were all human and everybody have needs (FT 25/5).
He further said, “some have mortgages, we have relatives, we have commitments to our churches, and these are all facts of life.”
If our MPs who earn about $60,000 annually plus other perks are facing these challenges, then what about the plight of our ordinary workers who are paid $4 an hour?
This budget presents a unique opportunity to make amends for past failures. Let’s give them what is rightfully due to them.
- Selwa Nandan is a regular contributor to the Letters to the Editor and the views expressed here are his and not necessarily shared by this newspaper.
