Minimum wage hot topic in Parly
Mompati Tlhankane | Monday December 11, 2023 06:00
A minimum wage is the lowest amount a worker can be paid hourly determined by law and paying an individual below the minimum wage is illegal. On Friday Lobatse Member of Parliament, Dr Thapelo Matsheka asked Mokgethi amongst others the factors considered in setting the minimum wage in Botswana.
He had also asked and whether the latter considered that the level of the minimum wage compensates for the cost of living. In response, Mokgethi outlined that the factors that are considered in setting the minimum wage in Botswana are outlined under section 133(2) of the Employment Act.
"The needs of the employees concerned and their families, taking into consideration the general level of wages in Botswana, the cost of living, any social security benefit and the relative living standard of other social groups; The desirability of eliminating discrimination between the sexes in respect of wages for equal work. Economic factors, including the requirements of economic development, levels of productivity and the desirability of attaining and maintaining a high level of employment; and all other relevant matters,” she quoted section 133(2) of the Employment Act.
She also indicated that over and above these factors, the Minimum Wage Advisory Board (MWAB) also considers other variables that could assist in setting the minimum wage such as Inflation, retrenchments, contraventions of the minimum wage, the Food Consumer Price Index, salary adjustments in the Public Service, affordability and sustainability, social safety nets, old age pension, Ipelegeng workers allowance, World War veterans, disability cash transfer, destitute cash component and VDC members’ allowances. “The cost of living index is indeed one of the factors considered in setting the minimum wage rates.
The Board in making its recommendation on the adjustment of minimum wages, considers various factors as I have already indicated, including the cost of living index with a view to ensure that the wages are decent, affordable and sustainable. It is also important to emphasise that decisions in the Board are an outcome of extensive dialogue and consensus by the tripartite plus who constitute the Board and are mandated to represent membership of their organisations. I am satisfied with the Board’s composition as it is today,” she added.
Mokgethi added that the average income is an individual's earnings which cannot be reflected by the wealth of a country measured through the per capita index. She also clarified that the two issues are not related therefore you cannot use one to determine the other. “According to the third schedule of the Employment Act, Cap 47:01, the members of the Minimum Wage Board are as follows: two or three - independent persons, two or three - represent the Government, two or three - represent employers, two or three - represent employees.
The Board members are from various fields such as law, human resources management, industrial relations, economics and public administration. The other members are trade unionists and business men and women nominated based on their activism by their organisations,” she said. Mokgethi further said the Board currently comprises three members from each category that is represented in the Board. She said the Act also provides for alternate members in respect of each substantive member of the Board and they have also been appointed accordingly.
“I am satisfied with the Board’s composition as it is today,” she revealed. This week on Monday, the minimum wage topic was brought back to Parley with Gaborone Bonnington South MP, Christian Greeff asking when Mokgethi is intending to set up a Minimum Wage Advisory Board in terms of Part XVI of Employment Act and if there was any thorough research when the current minimum wage was set. Mokgethi was quick to reiterate what she has before parliament before that MWAB is already in existence and properly constituted in terms of Section 131 of the Employment Act as at June 2023.
“The Board consists of the following members as provided for in terms of the Third Schedule of the Employment Act: Three independent persons; three members representing Government; three members representing employers and their three alternate members; and three members representing employees and their three alternate members,” she further disclosed. “The above information is derived from well researched or factual information from relevant public entities and private institutions.
These include amongst others my Ministry (reports on minimum wage contraventions), Ministry of Finance and Economic Development and Ministry of Local Government and Rural Development and Statistics Botswana, amongst others.” Mokgethi added that the Government is advised by a tripartite plus Board on the appropriate minimum wage from time to time and in doing so, one of the factors considered is the cost of living as required by the law (The Employment Act).
“I would like to underscore that, even though the Board has made such recommendation and approved by my office, it is important to note that the minimum wage by definition is the Statutory Wage only and does not prevent employers from paying their employees more or equivalent to their income earnings as businesses. Employers remain at liberty to realise the value that their employees bring to the business and reward them accordingly,” she noted. Late last month, Mokgethi was before Parley again defending Botswana’s minimum wage.
Mokgethi was responding to a question from Francistown West legislator, Ignatius Moswaane, who had asked amongst others if she was aware that security companies are underpaying their employees and that the latter work under stressful and unsafe conditions for wages that amount to modern-day slavery. Mokgethi emphasised that Botswana rates are not modern day slavery wages as the rates are a consensus of the parties concerned through the MWAB. Mokgethi said the MWAB have vested interests in setting the minimum wage rates.
In 2022 government adjusted the minimum wage rates by 8.4 percent across the board. The minimum wages rates for domestic and agricultural sectors were adjusted to P1, 084 per month while most industries were adjusted to P7.34 per hour. Although government has not revealed how much is going to be set as the minimum wage when they increase it before the end of this financial year, the MWAB is reported to have convened on August 10, 2023, September 13, 2023 and October 31, 2023 to consider the adjustment of the minimum wages rate. According to government, the tripartite have considered factors of inflation, the buying power and other economic factors in their conclusions. As is required by law, Mokgethi announced before that she has received their recommendations for consideration. Pressure will be on the government to set considerate minimum wages following the opposition’s decision to adjust its initial proposed P3, 000 for 2019 to P4, 000 now.