Secretary-General of the Trades Union Congress (TUC) Dr. Yaw Baah recently threatened to embark on an industrial action never-seen-before in the history of Ghana, if government does not increase the salary of members.
He spoke at a forum in Accra on Thursday, April 21 where he cautioned government not to hide behind the impact of the coronavirus pandemic and ongoing Russia and Ukraine war in order not to increase salaries.
Addressing members at the Organised Labour pre-May Day Forum 2022, the TUC General Secretary noted that since 2021 fuel prices have shot up a significant number of times; and as a result transport fares have increased, thereby affecting the prices of goods.
Dr. Yaw Baah stressed that these are hard times and salaries must be increased to alleviate the economic pressure.
“In July 2021, when we were negotiating public sector pay for 2021 and 2022, inflation was just 9%. As we speak, it has reached 19.4%. This has taken a toll on every worker in government.”
Rising cost of food pushed the inflation rate for the month of March 2022 to 19.4% – the highest since August 2009, the Ghana Statistical Service (GSS) has revealed. According to the figures, food inflation recorded a rate of 22.4% in March 2022 compared to 17.4% in February 2022.
Dr. Baah said this ahead of minimum wage negotiations for 2023 at a pre-May Day forum in Accra, and indicated that Organised Labour will go on strike if government fails to ensure the minimum wage of workers matches the inflation rate.
He added: “The National Tripartite Committee has started the process toward determining the minimum wage for this year; for us, that’s a do or die”. He said the leadership of Organised Labour is working to ensure that the minimum wage of workers for every year is not below the inflation rate.
The Ministry of Employment and Labour Relations has scheduled Thursday, April 22 to meet leadership of the Ghana Employers’ Association (GEA) and Organised Labour for a meeting of the National Tripartite Committee to determine a National Daily Minimum Wage.
The Tripartite Committee is made up of representatives from the Ministry of Employment and Labour Relations, five representatives of Employers and five other representatives from Organised Labour.
The National Daily Minimum Wage was last adjusted in 2020. It went up by 11 percentage points from the 2019 minimum wage of GH¢10.65 to GH¢11.82. The annual adjustments are in line with the Labour Act, 2003 (Act 651) section 113 (1) (a) and the Public Financial Management Act, 2016 (Act 921).
The issue of unequal pay for equal work has been compounded by extreme inflation, which has plagued Ghana’s economy recently.
The Constitution of Ghana recognises the right to fair remuneration and equal pay for work of equal value. In accordance with the Labour Act, every worker should receive equal pay for work of equal value without any discrimination.
Government began implementing the Single Spine Salary Structure in 2010 to address worker-salary distortions and guarantee better public sector pay, but there is still dissatisfaction among worker groups.
That’s why the Fair Wages and Salaries Commission earlier this year announced there will be a review of the over-a-decade-old salary structure.
Minister of Employment and Labour Relations, Ignatius Baffuor Awuah, earlier in the year stated: “I must admit that lately we have had some calls from some organisations to opt out. We are having further engagements to determine whether the Single Spine has outlived its purpose or not, and whether we should maintain it or make changes”.
There is a huge gap between Article 71 office-holders and workers under the single spine. The base pay was increased by 7%, minimum wage by 8%, while Article 71 holders had theirs increased by 80% and SOEs had theirs increased between 34% and 40%.
We agreed with government that considering the excesses with COVID-19 and mass lay-offs across the world, we would be considerate enough not to pressure government for salary increment. Before we realised, Article 71 holders had increased their salaries exponentially. What message did they communicate to us?
However, the Ghana Employers Association has urged the Tripartite Committee to peg the minimum wage rate at a reasonable percentage for businesses. Chief Executive of the Association, Alex Frimpong, noted that these are very difficult times for businesses and we may need to peg the minimum wage at a rate businesses can afford.
“If the rate is such that it will be difficult for businesses to reward labour, then it will compromise the sustainability of businesses – and for that matter, it will be very difficult for employers to support such an idea.”
Thirty billion cedis, representing almost 50 percent of national revenue, goes into the payment of public sector wages. However, labour unions are demanding commensurate earnings to cope with the rising cost of living.
Director of Labour Research and Policy Institute, Trades Union Congress (TUC), Dr. Kwabena Nyarko Otoo, is urging government to heed the demands of labour unions. He is of the conviction that government should restore workers to the level of pay eroded by rising prices in the country.
He notes that in the last 2 years wage income has declined by about 30%.
“Now if you take the whole period that we have implemented single spine, wage income has actually declined by 8% in real terms; so when you put all this together plus all the other things happening in the economy, labour is hard-hit and the least you can do is just restore us to the level of our pay that has been eroded by rising prices,” he states.
According to him, the unions expect the addition of a standard of living allowance in 2023.
Economist and Finance Lecturer Dr. Lord Mensah believes labour agitation for better wages is rational, and adds that it is a demand every consumer in the country should call for given the escalating prices of goods in the market.
He believes salaries should be indexed to reflect inflation numbers, something that Organized Labour is pushing for; but in the midst of economic austerity, one wonders whether the Tripartite Committee can meet this demand.
Currently, the Civil and Local Government Staff Association of Ghana (CLOSSAG) has been on strike since Thursday, April 22 over what it terms a ‘Neutrality Allowance’ agreed upon in January this year by government.
Although demands for the Neutrality Allowance has generated public debate, with divided opinion on the relevance of such an allowance, the fact remains that whatever the nomenclature civil servants want improved conditions of service.
Coming at a time of global economic crisis owing to factors like the economic fallout from the COVID pandemic and current crisis in Ukraine, how government is able to assuage these worker agitations for better wages and meet their demands is another matter altogether.
We expect government to make its intentions clear at the May Day parade, which will be graced by President Akufo-Addo.
