6% increment in daily minimum wage inadequate

The Chief Executive Officer of the Fair Wages and Salaries Commission, (FWSC) Dr. Edward kwapong has admitted that, the 6% increase in wages may not be adequate but workers should bear with the commission as it expects a rebound of the economy to turn things around.

This comes after the 2021 National Daily Minimum Wage went up by 6 percent to GHc12.53 effective June 4, 2021, from the GHC11.82 that took effect on January 1, 2020.

This is in pursuance to the Labour Act, 2003 (Act 651) section 113 (1) (a), and comes after concluded negotiations by the National Tripartite Committee (NTC) on the determination of the National Daily Minimum Wage.

The negotiations also concluded on the 2022 National Daily Minimum Wage. It pegged the 2022 minimum wage which is to take effect on January 1, 2022 at GHc13.53.

“In determining the new rates, the NTC took into account the impact of the Coronavirus (COVID-19) pandemic on the national economy, cost of living, sustainability of businesses and desirability of attaining high level of employment,” a communiqué following the negotiations stated.

The Committee urged all organizations paying below the minimum wage to ensure that they adjust their wages in accordance with the new wage, warning that organizations that flout the new rate will be duly sanctioned.

“All establishments, institutions or organizations whose Daily Minimum Wage is below the 2021 National Daily Minimum Wage should adjust their wages accordingly with effect from 4th June, 2021. Any establishment, institution or organization that flouts the new rate shall be sanctioned in accordance with the law.

Reacting to the development in an interview on 3FM, Dr. Kwapong said it is true cost of living is going up but it is a matter of two options that are really difficult to handle so the commission chose the better of the two margins.

“We took into consideration the constraints of all the partners to prevent tension. Ability to pay is the golden rule. Do you have the ability to sustain your business?  And you know cost of labour as a percentage of total operating cost is a major consideration for every entrepreneur so much as you see it as insignificant we are doing this to sustain jobs in this country” he said.