Why govt fears minimum wage
Parliament on Wednesday passed the Employment Amendment Bill, 2022, which, in its blueprint, did not capture the issue of the minimum wage that labour unions have been pushing for.
The Bill, in general, seeks to improve working conditions for employees by addressing exploitation by employers and ensuring that casual labourers who have served for six continuous months are deemed to have a valid contract.
“The Bill on minimum wage can stand out on its own,” Ms Margaret Rwabushaija, the workers’ representative in Parliament, told this publication yesterday, adding that the Bill has been finalised and will be re-tabled soon.
However, Mr Aggrey Kibenge, the Permanent Secretary of the Ministry of Gender, Labour and Social Development, said the issue of minimum wage is being handled by Cabinet.
“The issue of minimum wage has not yet been resolved. It is at Cabinet level and we are waiting [for their resolution]. It has never been concluded,” Mr Kibenge said.
“There is a question of making sure that you take care of all dimensions; you don’t only think about the workers, you also think about the employers. That balance, I think, is what they have not yet sorted out,” he added.
The Minimum Wage Bill, 2015, was passed in 2019 by the 10th Parliament, but when it was taken to the President, he declined to sign it. The President reasoned then that what the Bill intended to cure is already addressed in the Minimum Wages Advisory Boards and Wages Council Act. He was also concerned about the implication of the Bill on investors.
The President stated in his letter to the then Speaker of Parliament Rebecca Kadaga that Cabinet had directed the Ministry of Gender, Labour and Social Development to review a report on the implications of fixing a minimum wage to investment and the economy.
“Having received advice from the Attorney General… I hereby refuse to assent to the Bill… There are no gaps in the Minimum Wages Advisory Board and Wages Council Act that the Bill seeks to cure,” read the President’s letter in part.
“The said report was prepared by the Minimum Wages Advisory Board and cabinet still awaits the report from the ministry so as to make an informed decision,” Mr Museveni added.
But the chairperson of the National Organisation of Trade Unions, Mr Usher Wilson Owere, asked Parliament to expedite legislation for the minimum wage to safeguard workers from exploitation.
Mr Owere told this publication yesterday that the President was misled by some officials in government because the said Act is not enough to address issues of minimum wage.
“They are supposed to get out that Bill, ask the Speaker what the President wants, answer the concerns, take it back to him and if the President doesn’t sign it, they can make it into a law,” he added.
Mr Owere told this publication then (in 2019) that the enactment of law on a minimum wage was a directive by the International Labour Organsiation (ILO) when Notu took government of Uganda to the International Labour Experts Committee in 2017 and the government of Uganda was directed to put in place the minimum wage.
Ms Rwabushaija said that in the Bill on minimum wage, they are looking at many aspects that make it unwise to combine with the Employment Bill.
“In the Employment Bill, we have people who are working in Uganda --those who are working for the government and those in the private sector. But also the Bill was also concerned with externalisation of labour,” she said.
“There are people who come to Uganda, so we want to know the laws they are following, this is for both employers (investors) and employees. It concerns them in terms of the employer-employee relationship. So, already it was so loaded. On salaries, we are looking at different categories of workers [to determine the minimum wage for them],” she added.
Mr Dan Okanya, the head of policy and research at the Federation of Uganda Employers, said they equally need the law on minimum wage.
“There is an urgent need for the country to have a law on minimum wage. This will give a basis upon which any investor can determine how expensive the cost of labour is,” he said.
“Within East Africa, it is still Uganda which doesn’t have a law on minimum wag,” he added.