By TREVOR WAHUNE
LABOUR and Industrial Relations Minister Mehrra Kipefa is concerned that the Papua New Guinea’s minimum wage is not enough to sustain the majority of the workforce.
He said another issue involved was that some employers were still paying below the current minimum wage and looking for excuses not to pay the K3.50 per hour threshold.
Kipefa told a media conference in Port Moresby yesterday that his ministry was in dialogue with bodies such as the Investment Promotion Authority (IPA) and Internal Revenue Commission (IRC) to increase the minimum wage from K3.50 an hour to at least K5.
THE minister’s suggestion comes at a time when the cash-strapped Government is facing a downturn in the economy as well.
“We have social partners who have agreed for us to move the minimum hourly rate to K5,” Kipefa said.
He said it would take a nationwide dialogue involving industries, companies, the government and private employers to agree and consolidate on an agreement on how to increase the current minimum wage to a level which all companies were able to source money to pay workers a much better rate.
The minister said it had taken about two years since the labour board met to come up with the final outcome of the issue to submit to the government to have it approved.
“But since then, the K3.50 rate per hour is still in existence,” he said.
“Also, not many companies are following proper regulations.
“They have come up with so many reasons, saying they are not generating enough revenue and therefore make it a wide area for the government to deal with.
“Taking into consideration the economy, the upraising of individual entrepreneurs or business houses – they are also climbing mountains in terms of generating revenue.
“All this also falls in line by keeping to the current rate of K3.50.”
Kipefa said a minimum wage consultation would soon be underway.
“We are just waiting for a chairperson to be appointed. Then we will go about with the consultation of minimum wage but at the moment we just have to wait to have a replacement of the administrators as well, then we can deal with it.”
Kipefa said there were strategies in place to scrutinise companies but some did not comply.
He said the social bodies in place to help review minimum wages were IRC, IPA, the Department of Labour and Industrial Relations and police.
He said taking on the other side of the employer’s jurisdiction, it was hard-work to earn the money to pay their workers “so a balance has to be struck between the employers and the workers.”
“However, employers should also understand that whatever little workers earn are used to support their families and extended families. At least these are some of the things that need to be taken into consideration when reviewing the minimum wage.
“In our next meeting, we will be looking at these issues before bringing it up to the National Executive Council to approve.
In terms of penalties for non-compliance, Kipefa said: “Sometimes fees were charged on those who did not comply, and in the worst case scenario deregistration of the company.
“But in most cases we give them time to improve.
“For their first year, we give them a lot of time to improve because they are in the process of starting.
“After the second year, that’s where the annual returns and revenue should be in a range that focuses on the budget, then plan on the second and third year and onwards.”
Meawhile, Kipefa said that his ministry was working to improve the terms and conditions of employers to ensure their work permits incorporated an agreement to train employees.