Industry players are divided in opinion on the government’s timing in implementing the new labour laws, with opponents claiming the move would result in some people losing jobs.
Last month, Labour Minister Ken Kandodo formally signed for the gazetting of the amended Employment Act, which went into effect on January 1 2021.
In the Act, the minimum wage has been adjusted to K50,000 from K35,000.
However, Employers Consultative Association of Malawi (Ecam) has said the development would force many of their members, ranging from big companies to small and medium enterprises, to retrench employees for them to remain in business.
In an interview Ecam President George Khaki said most of their members have indicated that they cannot afford to pay the K50,000 minimum wage as businesses are already pressed due to the Covid-19 pandemic.
He said implementation was done without adequate consultations.
“We have seen a resurgence in Covid-19 cases, which means businesses will continue to suffer— they way they suffered last year. Therefore, we feel that the implementation of the minimum wage is ill-timed,” Khaki said.
However, the Malawi Confederation of Chambers of Commerce and Industry believes operationalisation of the new law is timely because the sectors were consulted and many are already above the K50,000 minimum wage.
Its chief executive officer Chancellor Kaferapanjira said it is only the tea sector which complained and has since written the Ministry of Labour.
“Majority of the sectors said they are already above the set minimum wage and, as you know, the law has categorised the minimum wage. So, there is the part for general minimum wage, applicable to people such as domestic workers, and other parts applicable to, for example, drivers— who have been having seat-ins to force [their employers to give them] good pay,” Kaferapanjira said.
Deputy Labour Minister Vera Kamtukule said they would not relent on the issue but scale up inspection efforts.
“As part of the reforms we are beefing up and restructuring the Inspections Department to ensure that they are enforcing the law as far as the minimum wage is concerned. What we are trying to promote is decent work. People should be paid for the work they do,” Kamtukule said.
Recently, the Centre for Social Concern asked the government to increase the minimum wage to K100,000, claiming the average cost of living has been pegged at over K194,000 for the past 12 months.
The organisation further said the food poverty line is over K100,000, hence the current minimum wage is not enough.
Justin Mkweu is a fast growing reporter who currently works with Times Group on the business desk.
He is however flexible as he also writes about current affairs and national issues.