CHAPTER ONE
INTRODUCTION
Background of the Study
The history of Nigeria’s pay structure predates her political sovereignty. In the course of evolving an enduring and sustainable pay structure and income policy in Nigeria, different commissions have been established, both in the colonial and past colonial periods. These ad hoc bodies set up by different governments to handle wage reviews were often influenced by labour unrests resulting from the desire for better salaries and conditions of service.
These commissions are the Hunt commission (1934), Bridges Commission of Enquiry (1941), Tudo Davis Commission (1945), Harragin Commission (1946), Miller Committee (1947), Foot Commission (1948), Adebo-Philipson commission (1954), Messrs Gorsuch and Randell Commission (1955), News Commission (1956), Mbanefo Committee (1959), Morgan Commission (1963-64), Wey Panel on Public Service Management and Salary Administration (1960), Elwood Grading Team (1964), Adebo Commission (1970-71), Udoji Public Service Review Commission (1972-74), the Cookey Commission (1981), Dotun Philips Study Group on the structure, staffing and operations of the Nigerian Civil Service (1985), Presidential/Koshoni Task Force on the implementation of Civil Service reforms (1988), Fatai Williams Committee (1990), the Commission on the Review of Higher Education in Nigeria Longe Commission (1991), Allison Ayida Review Panel on Civil Service reforms (1994-1995), the Vision 2010 Committee on Harmonization of Remuneration in the Public Service (1998). Damachi Tripartite Committee 1990, 19-Man Presidential Committee 2000, Wages, Salaries and Emolument Relativity Panel 2004-2005, Consolidation of Public Sector Emolument Panel 2005- 2006, Stephen Oronsoye Panel 2010-2011.
Many administrations have come and gone but not without deliberating on what constitutes the appropriate or minimum wage or salary of civil servants should be. In some situations, it has not been without industrial disputes, especially during the military era while most of the civilian regimes were dominated by trade disputes initiated by major labour centers in the country (Obiora, 2012). Sometimes, the crises arising from such dispute leads to break down of law and order, especially when they are hijacked by miscreants in the society. Workers, through their labour representatives have always asked for improved conditions of services and can go to any length to press home their demands. It is imperative to know that national minimum wage in Nigeria is characterized with crisis, workers protests and agitations. According to the President of Nigeria Labour Congress, Comrade Ayuba Wabba, Nigerian workers have never in history got any increase in wage on a platter of gold. Rather, it has all been gotten through confrontations with the powers that be and government of the day. While the political office holders have always enjoyed fat salaries and allowances, the workers in history have always being at the very lower elm of poor salary arrangement or structure.
National minimum wage in Nigeria is determined by the Government. Government is empowered to set up “industrial wages boards” for specific sectors or geographical areas where it considers wages to be “unreasonably low” or where there is no adequate collective bargaining machinery for the effective regulation of wages or other conditions of employment of those workers. The boards, tripartite in nature, may make recommendations on wage rates, which the Government may make binding on the employers and employees concerned. Legislation provides for both National Wages Board and Area Minimum Wages Committees. Other than wages, an industrial wages board may, on the permission by the Minister, make a recommendation for a condition or conditions of employment other than wages.
For many decades, the image of an average Nigeria government worker has been very poor; it projects a picture of an individual, whose sense of responsibility has been dulled by frustration and negativism. An average Nigeria government workers or civil servant is habitually nonchalant to his duties. He needs to be closely supervised before he could discharge his duties. Bad attitudes displayed by the workers include, habitual lateness to duty, constant absence from duty under fictitious excuses, maligning, sabotage of official interest etc. The researcher believes that those multi-furious bad attitudes of an average government worker is rooted in a popular adage that “a hungry man is an angry man.
In any organization, be it in the private or public sector, remuneration is a very sensitive issue, not only to management but also to employees (Nwachukwu, 2009). Wages and salaries constitute a significant part of the total cost of operation in any organization or establishment. In some organizations, such as civil service, they make up more than 50 percent of operating costs. In the organized private sector, large organization’s ability to attract and retain valuable employees in part depends largely on how much they pay. Poor wages are a constant source of frustration if labour and management are engaged in constant strife with resulting decrease in productivity (Nwachukwu, 2009).
The problem of the public sector arose from the problem of securing appropriate income for public servants. Although the incomes of an average public servant differ from one country to another, there is however a universal confessor of what is considered as a decent work. Work is central to people’s lives. Yet often times people work in conditions that compromise their ability to live productive lives. International Labour Organisation (ILO)’s Decent work Agenda sums up people’s aspirations for a full and productive employment that delivers a fair income, security in the work place and social protection for families, better prospects for personnel and social integration, freedom for people to express their concerns, organize and participate in the decisions that affect their lives and equality of opportunity and treatment for all women and men (ILO, 2010). International Labour Organisation perception of fair income complimented Fredrick Taylor’s scientific management theory also called the management theory which emphasizes efficiency, much like Max Weber’s. However, according to Taylor, rather than scolding employees for minor mistakes, employers should reward workers for increased productivity. Taylor and his followers maintained that the basic motive of a man at work was economic. Money was seen as a principal motivation instrument. Wage incentives are motivational factors. According to Croft (1996) motivation can be defined as “impulses that stem from within a person and lead him to act in a way that will satisfy to get reward for their effort. The exchange of labour for financial reward in the market in the heart of pay process. People do not put forward their best unless they get reward for their work. Ubeku, (1975) stated that, the payment of good salaries and wages is fundamental to the increase in the prerequisite for effective performance. In order to motivate people to put maximum efforts, it is essential that their various needs especially as it concerns their wage and salaries be satisfied as far as practicable. According to Popoola (2012:12) a just minimum wage to maintain not only the life but the health and the vigour of the working people is a law of necessity and knows no other law”. Therefore, motivation and productivity are twin concepts in organizational development.
A large number of experimental studies have supported the hypothesis formulated by Akerlof in 1982 that employees consistently provide higher effort levels in response to higher wages. Most of these studies have focused on pay levels of individual firms, showing that higher pay compared to elsewhere can attract more experienced and motivated applicants. Higher pay can also elicit greater commitment and productivity from existing employees (Ehrenberg and Smith, 2009). The effect of minimum wages – as opposed to higher wages in individual firms – on workers’ motivation has also been found to be positive. Using a standard natural experiment design Georgiadis (2013) for example found that the U.K. national minimum wage has operated as a kind of efficiency wage” in the residential care homes sector, increasing motivation and leading to a reduction in the level of worker supervision required. Experimental evidence in the U.S. by Owens and Kagel (2010) also points to a positive relationship between minimum wages and workers’ effort, leading to the conclusion that if well-designed minimum wages can generate improved outcomes where employees have higher wages and employers have the same, or slightly higher, average labour cost.
1.2 Statement of the Problem
Nigeria operates a federal structure in which the states constitute the federation. On issues of salaries and wages, the minimum wage is on the exclusive list of the federal government. The implication of this is that when the federal government fixes the minimum wage, the federating states are expected to take a cue from that and do likewise for the state civil servants Nwokolo J.I, (2011). However, some states may pay more or less, because of peculiar economic fortune or misfortune.
Currently, the poor performance, lack of dedication and commitment of government workers have been a matter of concern and debate. How to improve the productivity of employees has been the topic of many seminars, symposia and conferences. The reason for this trend, as well as appropriate avenue for the apportionment of blame has formed the basis for the controversies. Many reforms in the public service such as work ethics, transparency, dedication and commitment to duties are some of the ways of trying to improve productivity of the workers in the country. According to Nwachukwu (2018:102) Nigerians have always come with the impression that generally, some workers are lazy, sleepy, reluctant to act, unconcerned and deceitful in their approach; these workers are said to lack the zeal, the business and the momentum of hardworking people and generally, they dislike having anybody talk about efficiency, dedication, competence, determination and productivity of which characterize people in a production oriented society.
In production-oriented society, the employers strive to boost the morale of their employees with a view to eliciting positive attitude towards work, while the workers respond by fashioning ways of making their organization successful. In Nigeria, however there is inadequate stimulus to attract such responses, so the workers are still performing below average, morale still down and efficiency still nil.
The problem therefore, lies in the low productivity of government workers in Akwa Ibom State Civil Service because; the management sees motivating their effort force as something not too important because they do not value their employees. They lack an enabling environment for work performance, poor incentive, tribalism, and sentiments, bureaucracy and quota system helps in contributing to poor performance. The management does not adequately motivate their employees giving rise to low morale among the workers. In view of the above, the study will examine the extent of how minimum wage affects workers productivity and increases development.
1.3 Objectives of the Study
The main objective of the study is to examine the impact of minimum wage on workers’ productivity in Akwa Ibom State Civil Service.
Other specific objectives include:
To examine the relationship between minimum wage and workers productivity in Akwa Ibom State Civil Service.
To ascertain the extent of implementation of minimum wage policy in Akwa Ibom State Civil Service.
To explore how workers, get motivated through minimum wage increment in Akwa Ibom State Civil Service.
To make recommendations on how to maximize workers productivity in Akwa Ibom State Civil Service.
1.4 Research Questions
In a bid to actualize the purpose of this study, the following questions were raised;
What is the relationship between minimum wage and workers productivity Akwa Ibom State Civil Service?
to what extent is the minimum wage policy implemented in Akwa Ibom State Civil Service?
how do workers get motivated through minimum wage increment in Akwa Ibom State Civil service?
What other ways can workers in Akwa Ibom State Civil Service be motivated so as to enhance their performance?
1.5 Research Hypotheses
In other to arrive at a proper conclusion in this study, the following Null (Ho) and Alternative (Hi) were formulated and tested in the course of the study:
1 Ho: there is no significant relationship between minimum wage and workers productivity.
Hi: there is a significant relationship between effective minimum wage and workers productivity
2 Ho: there is no significant relationship between minimum wage policy and workers efficiency in Akwa Ibom State Civil Service.
Hi: there is significant relationship between minimum wage policy and workers efficiency in Akwa Ibom State Civil Service.
3 Ho: there appears to be no significant relationship between minimum wage increment and employee performance.
Hi: there appears to be a significant relationship between minimum wages increment and employee’s performance.
1.6 Significance of the study
This study hopes to provide a comprehensive document that
would discuss salaries and wages administration in Akwa Ibom State Civil Service and
performance in the Civil Service. The conclusion(s) drawn in this
study should help administrators in finding lasting solutions in motivating
workers in order to improve their productivity. The study might also signify the
beginning of the solution to solving the problem of productivity measurement
that has defied solutions in the past when it comes to measuring services. The employees and the employers are the beneficiaries of this study because when
employees are well paid; they tend to work well by so doing; the organization is
increasing their productivity because the employees are committed to their work.
1.7.1 Scope of the Study
This study covers minimum wage and workers’ productivity in Nigeria. This work is restricted to Akwa Ibom State Civil Service.
