The Ministry of Labour and Social Affairs, in collaboration with the Confederation of Trade Unions, is in the process of finalising the formation of a Wage Board. The board’s first task is going to be the design and implementation of a minimum wage framework across the country.
The ministry confirms that it has completed most prerequisites for the establishment of the board and is set to send the final proposal to the Council of Ministers within the coming weeks for approval.
The Wage Board will consist of four groups of members; workers, employers, the government, and civic associations.
Fikadu Gebru, Director of Peaceful Industry Relations at the Ministry of Labor and Social Affairs, confirms that the priority of the ministry is getting a minimum wage framework adopted, after which the formation of the board can proceed. According to him, the board is going to be more responsible for implementing the minimum wage framework after it is passed.
Fikadu also affirmed that the framework is going to adopt basic global principles while also taking the Ethiopian context into account. These basic global principles include the living standards of employees and the payment capabilities of employers while the local context will primarily focus on macroeconomic issues such as GDP per capita, poverty threshold, etc.
Kassahun Follo, President of the Confederation of Trade Unions, on the other hand, says that the current level at which wages in the country are is disheartening. He cites the wages that industrial park workers make (which ranges from ETB 750-1,000 a month) as an indicator of the need for a minimum wage framework.
Indeed, it is no secret that living off ETB 1,000 is virtually an impossibility, especially with the current inflation bubble that Ethiopia seems to be trapped in.
Some gaps within the framework that might need redress in the coming years include the exclusion of civil servants and contractors and the informal sector’s prevalence, which relies on sales rather than wages (eg. family-owned farms).