The FTUC Biennial Conference held in Nadi on 7th May 2016 launched a campaign to raise the National Minimum Wage to $4 an hour. While the FTUC is mindful that the $4 Minimum wage will still peg workers below the poverty line, we believe that $4 is a decent starting point to work towards a Minimum Wage that is pegged above the poverty line. The FTUC estimates that the poverty line is around $4.50 an hour. We advocate that annual adjustments must be made to work towards that goal.
The Constitution of Fiji at Chapter 2, Section 33 clearly states “The State must take reasonable measures within its available resources to achieve the progressive realization of the right of every person to work and to a just minimum wage.” The current minimum wage of $2.32 is grossly inadequate and condemns workers to extreme poverty. It is not a realistic starting point to progressively ensure a “just Minimum Wage” as the target is too far off and annual inflationary movements will further make it impossible to realize a minimum wage above the poverty line.
The situation is further compounded by the National Employment Center policy on providing employment for young people. The wage guideline set for attaches is $60 per week without any FNPF deductions, overtime payments or any other benefits applicable to these workers all in the name of creating employment. The reality is that in many workplaces, permanent employees are being replaced by these attaches at $60 per week. This has undermined the National Minimum wage and the minimum conditions set out in the Employment Relations Promulgation. What is happening in Fiji is that we are driving the wages downwards, a race to the bottom.
The current minimum wage of $2.32 means a weekly wage of $96.05 after FNPF deductions. Then we need to take 9% off that for VAT. This leaves the worker with $87.41 per week. A conservative 2015 estimate for Basic Needs Poverty Line is around $185.00 per week. This leaves a massive gap of about $97.59 per week. As time goes on, our people get deeper and deeper into poverty and debt, yet we wonder why productivity is still low. It is no secret that happy workers are more productive and it is the right time to address this issue.
The FTUC notes the concerns of employers. We also note that some 15 years ago, the Unions called for minimum wages to be increased to the poverty line through the Wages Councils. We were promptly told by employers that the time was not right. The past Chairperson, Fr. Kevin Barr of the Wages Council also advocated the same and was told the same thing just 6 years ago. We are now again told the time is not right. Well, when will the time be right for workers in Fiji to earn a just Minimum Wage. It appears never.
The FTUC understands the plight of small businesses and is receptive to some concessions for this lot. However it disagrees that bigger businesses hide behind the small businesses to pay poverty wages and claim to be concerned about small businesses. This trick will no longer work. Threats of unemployment rising are mere threats and FTUC is confident that if workers earn more, economic activity will increase, which will in turn create demand and jobs. This will be good for businesses as well. This is good for Government as when people spend more they pay more VAT. Decent work is also about a just wage and conditions of employment and not merely any job.
We recall the promise that the Prime Minister made to the people to create a Just society and that no Fijian will be left behind. So far it’s only the workers who have been left behind and we call on Government to act with some determination to ensure a fair deal for workers. A $4 minimum wage is a good place to start.