Government has allegedly u-turned on the minimum wage because some sectors such as agriculture and tourism are struggling to pay the minimum wage. According to labour Deputy Minister Rayford Mbulu, Labour Minister Fackson Shamenda will “soon” issue a new statutory instrument outlining new sector-based minimum wages. In July 2012, GRZ increased minimum wages by 67%, with back-dated effect, without prior consultations. Back then Shamenda rejected sector-based minimum wages as being complicated.
The minimum wage legislation appears not to have been implemented by many organisations. The Union of Commercial and Industrial Workers of Zambia (NUCIW) recently revealed that Shoprite Checkers management have ignored Government's directive to implement the minimum wage. Those that have “implemented” have moved to reduce other perks to ensure the impact remains neutral.
Instead of increasing enforcement the government is backtracking and now considering differentiated minimum wages based on sectors. This is rather surprising because such an approach is discriminatory against some sectors. More important it appears government is trying to plan the economy by artificially imposing differences in the cost of labour across the economy. It is interesting to note that the very few countries in the world have this sector based minimum wage policy. And for obvious reasons!
Chola Mukanga | Economist
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