In the 2019-20 budget, the federal of Pakistan and provincial governments of Khyber Pakhtunkhwa and Balochistan raised the minimum wage from Rs15,000 to Rs17,500 a month for unskilled workers. The Sindh government increased its minimum wage from Rs.16, 200 to Rs.17,000 a month. The Punjab government already had set the minimum wage at Rs16,500 per month in March this year. The law is inapplicable to informal sector and the fixed amount too little.Minimum wages defined by International Labour Organization (ILO) are “the minimum amount of remuneration that an employer is required to pay wage earners for the work performed during a given period.” Minimum wages protect workers against unduly low pay. They help ensure a just and equitable share of the fruits of progress to all, and a minimum living wage to all who are employed and in need of such protection.
In Pakistan, however, before 18th Amendment enacted in 2010, minimum wages for unskilled workers in organizations with more than 20 workers were fixed by the federal Minimum Wage Board constituted under ordinance, 1961. The ordinance was amended in 1969 and 2001 with new legislations introduced. Now, the federal and provincial boards determine minimum wages respectively. Sadly, the federal and provincial governments have seemingly failed to implement the laws for the welfare and improvement of financial condition of unskilled workers.
In developing countries like Pakistan, due to limited fiscal resources minimum wages are a possible mechanism to grant workers a decent standard of living. But because of the dual labour market structure of developing economies, effectiveness of the mechanism is limited. In Pakistan, the minimum wage covers only a formal sector but unfortunately it does not apply to an informal sector. Pakistan has the ninth workforce in the world, a large number of which has been working in an informal sector. According to the Labour Force Survey 2008-09, the informal economy of Pakistan accounts for more than 73.3 percent of the employment in main jobs outside agriculture. Shockingly, the minimum wage policy has not been helpful to raise the income of informal workers and protect them from exploitation by their employers. They are in low-paid and insecure work. The financial condition of these people is dismal. They have been living their hand to mouth lives.
The garment industry, a substantial employer of unskilled labour in the country, pays to its male workers Rs10,000 to Rs11,000 while it pays Rs7,500 a month to women labour.
Thousands of employees are working on petrol and CNG filling stations across Pakistan. These entities pay only Rs.6000 to Rs7,500 to their workers and also take 12 hour work instead of eight-hour work from their employees a day. Salaries of employees are deducted even when they take leave from duty owing to illness or some emergency. In this situation, employees of these entities are unable to provide even two meals to their families members.
Many of the middle class private schools exploit their employees by denying commensurate compensation to them. Teachers working in these institutions are though given heavy burden of work yet are paid meager salaries of Rs5000 to 7000 a month. Besides there is no provision for any other allowances, increments and medical facility to them.
Janitorial staff (sweepers) working on daily wages or on contract basis who clean up our filth and squalor are given wages as low as Rs11,000 to 14000 per month.
Besides, polio workers are hired on daily wages by the World Health Organization (WHO) through provincial health departments to carry out vaccination drives in the country. They do complicated and precarious work by carrying out vaccination drives in far flung and in high-risk areas to protect lives of our children from polio virus. But sadly, they are paid a meager wage of Rs400 a day, though they had been promised that a minimum wage of Rs1,000 a day would be paid to them by the WHO.
Enforcement of minimum wage law is not the only problem in Pakistan. Another is setting of the minimum wage. The Pakistan Institute of Labour Education and Research (PILER) advocates a living wage of Rs31,000, while the ILO has recommended a reference wage of around Rs25,000. The both amounts are significantly higher than the Rs.17,500 determined in the budget. This is impossible for a worker to buy food, medicines and pay utility bills and school fees from this inadequate fixed amount. This is sheer injustice and a massive exploitation of legal rights of hardworking unskilled minimum wage workers whose labour is important to producing significant wealth for their employers.
The federal and provincial governments are needed to contemplate the rationalization of the minimum wages in light of the ILO and the PILER and keep raising the amount according to the rate of inflation and other factors of living a decent life by a worker’s family. The minimum wages should be fixed for the both formal and informal sectors. There is need to evolve a mechanism of stringent legal actions for the violation of the law by some industry, factory or other business entity.
MPhil in Sociology @ Shah Abdul Latif University, Khairpur)