Timing of minimum wage increase essential

A lot has been said about Samoa’s minimum wage with workers, unions, leaders and international organisations adding to the public discourse in recent years.

But it was the groundwork by the Samoa First Union (S.F.U.) in 2016 that set the parameters for discussions to begin on the need to increase the country’s minimum wage. Collaboration between the union body and local and international partners sowed the seeds of unionism and improved awareness on better employee working conditions.

In April last year Samoa Workers Congress (S.W.C.) called for an increase in the minimum wage from $2.30 to $3.00 and cited the country’s rising cost of living as the rationale behind the proposed increase.

S.W.C. Director Gatoloai Tili Afamasaga said paying employees decent wages to enable them to look after their own families is key to going forward.

In March this year the S.F.U. called for the minimum wage rate to be increased to $5.00, with senior organiser Saina Tomi Fetalaia also saying people were struggling with the rising cost of living.

Three months later in June this year the Samoa government was criticised by economist and former Member of Parliament, Afualo Dr. Wood Salele, for “passing the buck” on the minimum wage issue to the country’s private sector.

He was of the view that poverty is on the rise in Samoa and increasing the minimum wage will address the issue.

In September this year, a light at the end of the tunnel for proponents of the minimum wage increase. 

Greek economist Dr Vlassis Missos – who was hired by the Ministry of Commerce Industry and Labour (M.C.I.L.) to study the issue and make recommendations to the government – reached the same conclusion that S.W.C., S.F.U. and former MP Afualo Dr. Wood Salele had reached earlier.

Dr Missos stated that the rising cost of living in Samoa warrants a minimum wage increase of over 60 per cent from $2.30 to $3.70 and the rate should be revised every two years.

The research by Dr Missos also made an interesting finding: Samoa’s highest income earners have seen their wages go up by close to $10,000 tala, unlike employees in the lowest wage bracket who saw little to no movement in their income levels. 

The findings of the study commissioned by the M.C.I.L. only reaffirmed the fears expressed by the local labour rights movement in recent years, the wages of working Samoans in the low wage bracket remaining static, in the face of inflation and increases in the cost of goods and services.

Therefore, the announcement by the M.C.I.L. in a December 16, 2019 public notice – advising of the Cabinet Directive FK (19) 44 approving an incremental increase in the minimum wage from $2.30 to $3.00 tala per hour –  is a welcome development for low wage earners, and a step in the right direction to address the widening gap between the rich and the poor. 

We know the 0.70 sene increase is only a drop in the ocean in the whole scheme of things, as the rise represents just 30 per cent and falls short of the 61 per cent that Dr Missos recommended in his report to the M.C.I.L. and the Government.

But hopefully it is the first step in what is hopefully wide-ranging labour reforms, which the Greek economist has recommended to ensure working Samoans are adequately remunerated, based on a two-year review cycle.

M.C.I.L. Chief Executive Officer, Pulotu Lyndon Chu Ling, in September this year said there is evidence of the country’s poorest missing out on the benefits of Samoa’s economic growth.

“There is evidence Samoa’s economy is increasing, however the poorest of the poor are not earning adequate wages to ensure [a] decent living,” Pulotu said.

But that was four months ago and with the measles outbreak declared in October followed by a state of emergency a month later, laying bare Samoa’s most vulnerable families, who are more likely to feel the brunt of the economic shellacking.

These are families who indirectly make up the country’s informal sector and rely on income generated from small economic and labour-intensive activity, such as selling vegetables at the markets or even selling taro chips on the streets of Apia.

In these hard times, the rise in the minimum wage rate could not have come at a better juncture, and could hopefully over time become the difference to enable families of low-wage earners to have food on the table for themselves and their loved ones.

Have a wonderful Saturday Samoa and God bless. 

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