Tripling of minimum wage raises eyebrows

The collective agreement on the minimum wage in the agricultural sector signed recently between the Agricultural Employers’ Association, the Namibia National Farmers’ Union, the Namibia Emerging Commercial Farmers’ Union and the Namibia Farm Workers Union in October 2023, which has apparently unilaterally been amended by the Cabinet, urges one to look into minimum remuneration issues.

According to the Labour Act of 2007, the issue of minimum remuneration falls within the domain of the Wages Commission contemplated in the Act and the minister responsible for labour. The minister may constitute the commission from time to time whenever the minister may decide to do so or at the request of any registered trade union or registered employers’ organisation.

The functions of the commission are to investigate terms and conditions of employment, including remuneration, and report to the minister in accordance with Section 114 for the purposes of making a wage order in terms of Section 13 of the Act. When convening the Wages Commission, the minister must determine the terms of reference of the commission, which must include amongst others the categories of employees to be included in the investigation, but the terms of reference must not require the commission to investigate a matter regulated by a wage order that has been in force for less than 12 months or a collective agreement that has been in force for less than 12 months.

The report to be submitted to the minister must consist of the commission’s findings and its recommendations, subject to the terms of reference, on:

- minimum remuneration;

- the amount of any increase or reduction in remuneration;

- the basis upon which remuneration is to be determined;

- the prohibition of payment of remuneration in kind;

- the deductions to be made, permitted or prohibited from remuneration;

- where, when and how remuneration is paid;

- what employment records an employer is required to keep, for how long and in what form;

- the prohibition of, or regulation and remuneration of, certain kinds of work, whether on the employer’s premises or off it, including out-work, task work, contract work, or piece work; and

- any matter connected or incidental to any matter contemplated in this paragraph.

After considering a report and recommendations of the commission, the minister may make a wage order determining remuneration and other conditions of employment for employees in any industry and area:

- in accordance with the recommendations concerned, or with modifications;

- by notice in the Gazette; and

- with effect from a date specified in that Gazette.

A wage order is binding on all employers and employees described in the notice and remains binding until it is:

- suspended or cancelled by the minister;

- amended or superseded by a new or amended wage order; or

- superseded by a collective agreement that provides for terms that are better than those contained in the wage order.

The minister, after consulting the parties bound by a wage order, may suspend or cancel all or part of that order by publishing a notice in the Gazette, setting out:

- the provisions affected by the suspension or cancellation;

- the industry and areas affected by the suspension or cancellation; and

- the period of the suspension, or date the cancellation takes effect.

Provision is also made in the Act that any person may apply to the minister for an exemption from the provisions of a wage order, and the minister may, in certain circumstances, exempt any person or category of persons from any provision of a wage order. The minister may, in writing, amend or withdraw an exemption.

The recent intervention by Cabinet to triple the minimum cash wage for the entry level of agricultural employees from N$6 per hour to N$18 per hour raised eyebrows and the question immediately arose as to whether Cabinet has such power, seeing that it was not a party to the agreement.

Apart from a provision in the Act that the president may, by proclamation in the Gazette, assign the administration of the provisions of any regulation to any member of the Cabinet, it would appear that Cabinet indeed does not have any enforceable power in so far as it relates to labour matters, including the determination of remuneration. The intervention by Cabinet can therefore be questioned.

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