Nov 28, 2011

Employers to move apex court against new salary provision

JUN 03 - The workers’ pay-hike issue does not seem to resolve anytime soon. Employers are undergoing final preparations to knock the Supreme Court (SC) door against the government decision on workers’ salary. The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has said that it will file a case by Sunday.

Employers have been strongly demanding that the government correct its decision and implement the 11-point agreement that they reached with three major trade unions on March 24
. They also declared that they would not put into practice the provision implemented by the government ‘unilaterally’.

Going against the 11-point deal, the Ministry of Labour and Transport Management (MoLTM) had implemented the new salary provision by publishing a notice in the Nepal Gazette on May 24. The new salary provision published in Nepal Gazette is based on the agreement reached between the government and disgruntled minor trade unions. FNCCI has been opposing the second deal.

As per the provision, employers must provide a minimum salary of Rs 6,200 a month (basic salary of Rs 3,550 and dearness allowance of Rs 2,650) and a daily wage of Rs 231 to all workers— except those of tea estates. The provision came into effect from March 15. Also, employers and employees should contribute 20 percent and 11 percent of the basic salary, respectively, to the Social Security Fund after the enforcement of the Social Security Act.

“We are forced to knock the court’s door as the government failed to implement the agreement we reached with major trade unions that is related to industrial peace and no work no pay provision,” said FNCCI President Suraj Vaidya at an interaction held here on Friday.

Employers said the government also breached the procedure of publishing a provision in the Nepal Gazette. The government did not take the issue of wage hike to the Labour Advisory Committee and Minimum Wage Fixation Committee as per the law, they said.

However, small trade unions that signed the second deal with the government are in favour of the new provision. “If not implemented, we will be forced to shut down industries again, demanding even more basic salary,” warned Lal Dhwoj Nembang, a trade union leader close to Baburam Bhattarai faction of UCPN (Maoist).

However, such warnings have failed to budge employers. With the new salary provision failing to ensure labour flexibility, FNCCI made it clear on Friday that they are not ready to contribute to the social security fund. The apex body of the private sector said the government’s unilateral move will lead the labour market to instability. “The government will have to take responsibility of such a situation,” said Bhaskar Raj Rajkarnikar, senior vice-president of FNCCI.

The government, however, is adamant to implement the provision published in the Nepal Gazette. A senior labour ministry official said as the new provision has already been endorsed, the government may take action against employers not complying with it. “It can be risky for the government as well as employers to bring down workers’ salary that has already been implemented,” said the official.



Timeline

March 24        Employers’ organisations seal 11-point agreement on worker’s salary, increasing the pay by Rs 1,500 a month.

March 25        Disgruntled unions start protests against the deal by shutting down industries

March 28        A CNI delegation meets Prime Minister Jhala Nath Khanal to solve the problem

March 30        FNCCI talks with agitating trade unions, but to no avail

March 31        PM Khanal assures to resolve the issue within two days

April 1    Dissatisfied trade unions withdraw strikes and start negotiations with the government

April 3    Dissatisfied trade unions demand an increase of Rs 2,000 in salary

April 16        Labour ministry agrees to hike the minimum salary by Rs 1,600 a month

May 24        Government formalises new salary provision by publishing a notice in the Nepal Gazette based on agreement reached with minor trade unions

May 25        Employers stand against the new provision

May 26        ANTUF central committee demands hike in basic salary by Rs 1,050

June 2    Employers say they cannot implement the new salary provision

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