16 Oct 2013

Proposed minimum wage in Fiji deemed not enough

5:26 pm on 16 October 2013

Workers' representatives are criticising a proposed national minimum wage in Fiji as below the poverty line for workers.

However, small businesses are also expected to suffer.

The governments national minimum wage consultant, Dr Mahendra Reddy, has recommended the minimum rate be set at $2.32 Fijian an hour.

Leilani Momoisea reports:

The former Wages Council chairman, Father Kevin Barr, says although the proposed minimum wage is better than nothing, it still falls well short of a living wage. He says some of the information the recommendation is based on is five years old, and since then the levels of poverty and disadvantage have increased considerably. He says he would like to see the minimum wage around the four-dollar mark, but the proposed wage is still a big increase for a number of workers.

"KEVIN BARR: Too many people have fallen way behind. For example, even those in the garment industry, security workers, domestic workers, gardeners, all those groups of people will all receive a much better wage if this minimum wage is brought in. You know, around the $4, $4.20 would be ideal, but maybe we've got to also get there gradually, I accept that."

The president of the Fiji Trades Union Congress, Daniel Urai, says the proposed rate is lower than what already exists in some of the 10 different wages sectors, which have their own minimum rates set. He says for example, the lowest rate paid in the tourism sector is $2.97. But Mr Urai says the labour ministry has also been failing at enforcing the minimum wages in these 10 sectors, and this would need to change if a national minimum wage is to succeed.

DANIEL URAI: We will have to review the minimum wage, at a more reasonable rate, and we have to strengthen the capacity of the ministry of labour so it has improve its manpower, increase the manpower within the ministry to be able to police this thing. So that, whatever the decision to implement, all employers will implement.

The vice-president of the Chamber of Commerce, Humphrey Chang, says while he expects bigger businesses will be able to cope, small to medium enterprises may struggle.

HUMPHREY CHANG: Now the SMEs or the small-timers will not be able to go along this line, because at the moment they may be paying say, $80 or $90 a week kind of thing, but the $2.32 takes it up to about $112 or so a week, and they may feel the pinch in that area.

And he says new school-leavers looking to gain experience in the workforce may find it more difficult if a minimum wage is imposed.

HUMPHREY CHANG: People forget that these school leavers who can't find work jobs, would be eager to get employment, irrespective of the pay, because they want to learn. Because if they don't get employed in the workplace, there is no way they can learn anything.

David Lamotte with the International Labour Organization, says it's not for him to comment on what the minimum wage should be, but it's excellent that there is an active policy dialogue taking place on how to reduce poverty.

DAVID LAMOTTE: It's clear many countries have used minimum wages as a means of achieving that. I really do want to commend the stake holders involved that have had the positive dialogue and that's something that's long overdue in Fiji. I'm hopeful that the type of dialogue the ministry is engaged in is a sign of better things to come in terms of social dialogue in Fiji.

A report on the proposed minimum wage is to be compiled by the Labour Ministry before it is to be submitted to cabinet for approval.