MINIMUM WAGE
MINIMUM WAGE
Kenya’s minimum wage and wage differentials are important issues in the country’s labor market. Kenya has a formal minimum wage system that includes the government in consultation with the National Wage Council. The National Wage Council is a body established under the Labour Relations Act that provides advice to the government on minimum wage and other wage related issues.
It is almost close to impossible to talk about minimum wage without touching on the wage differential. The main reason for wage differential in Kenya is the difference in education and trainings and skills needed between the various occupations. There’s a really large wage differential between high-skilled and low-skilled workers in our country. The skilled workers such as those in the finance, technology and engineering earn significantly more due to the extensive training and education as compared to the low-skilled such as workers in the agriculture, manufacturing and domestic sectors.
The National Wage Council is therefore meant to set the minimum wage with an aim of protecting vulnerable workers in the labor market, particularly the lower-paying sectors and those with fewer skills and qualifications such as those in the agriculture, manufacturing and domestic sectors.
Minimum wage has been defined as the lowest remuneration that an employer can legally pay their employees for work done for a given period of time and that can only be improved by Collective Bargaining Agreement and/or any other negotiation. According to ILO Convention 131, all ILO members are mandated to establish a system of minimum wages which covers all groups of wage earners whose terms of employment are such that coverage would be appropriate. In Kenya, the minimum wage is fixed based on regions and occupations. For example, a number of occupations in the agricultural sector are incorporated in the minimum wage setting. The minimum wage also goes ahead and provides the number of hours a worker is supposed to work per week. The minimum wage in Kenya allows a worker to work for 52 hours per week.
ILO also highlights the purpose of minimum wage as to ensure all employees are protected against precarious work. The minimum wage is also used to ensure equality between men and women by ensuring all employees have access to equal remuneration for work of equal value which is in alignment with ILO Convention 100 (which has been ratified in Kenya) and the Employment Act, Section 5(5). By establishing and reviewing the minimum wage to meet the needs of workers, Kenya will be moving towards the achievement of SDG 1 which is on No Poverty, SDG 5 on gender equality and SDG 8 which is on decent work and economic growth.
During 2022’s Labour Day celebration, which is commemorated annually on 1st May, the former president H.E Uhuru Kenyatta increased the minimum monthly wage with a 12% increase, which was from Ksh. 13,572 to Ksh. 15,201 for cities, Ksh 14,025.40 for all former municipalities and Ksh.8109.90 for all other areas. The 12% increase was out of the 24% proposed by the Central Organization of Trade Union- Kenya (COTU-K).
The minimum wage in Kenya has been a point of contention in recent years including the 2022 as the minimum wage is still too low to sustain a decent standard of living. The 2022 minimum wage raise was a good gesture to workers, but still the Ksh. 15, 201 still falls far short of what is needed to support a family, especially in urban areas where living costs are higher and getting higher by the day.
Currently, the inflation rate has increased to 9.2% from 7.1% in May 2022 and CPI increase to 131.18 from 123.12. The cost of basic commodities such as maize flour, cooking oil, milk and bread has sharply increased. The cost of living keeps on increasing day by day making it hard for workers to not only meet their families’ needs but also their own personal needs.
As a union, we encourage creation of employment but our main priority is ensuring Kenyan workers are well taken care of by ensuring they have decent work which includes fair remuneration. Kudheiha is a union that represent domestic workers, workers in hotels, educational Institutions and Hospitals. With the high cost of living, we urge the government to have these workers enjoy decent work by increasing the minimum wage by at least 24% to protect them from further erosion of their purchasing power and at the same time guaranteeing the competitiveness of our economy.