Honourable mimimum wage killer

Proposing a minimum wage is a good first move our first labour law gave which under the proposed revised new laws might be scrapped as well. The wording of the original 3 clauses in the employment bill were not very helpful or forceful but its a welcome first. However those very same ineffectual clauses were too much of a concession for the workers that the independent MP Honourable Mr. Muttalib saw fit to propose to veto out of existence. Under the proposed amendments to the labour bill, there is no talk about this matter which might mean the minimum wage idea is a goner now. Pity the workers!


11 thoughts on “Honourable mimimum wage killer

  1. It seems some statistics are available. Since there is no minimum wage, what is the average income by occupation?

    Gift Shop Employee
    Auto Mechanic
    Boat Attendant
    Boat Captain
    Department Heads

  2. Khakeem:

    Why do you think I might be stupid or work at ministry? I might be both!. I might be stupid AND working for Labour Ministry.

    I have given what I think the effects will be of what is discussed in the article. The author of this article disagrees, and I respect. There is no problem with disagreeing. But mere name calling is counter-productive is not worthy of discourse. Maybe you should consider putting some constructive comments.

  3. What is the ‘true’ market condition? When we close off the borders for expat labour? Or is it when we allow expat labour?

    Licensing will always tend to become restrictive for people who want to get-in. That’s the very nature of licensing in the first place. It has nothing to do with being ivy-league. Its bad effects are most felt on the less skilled less experienced people. Just to give you an example, in some states in the US, it requires months of training and fees from $5000 to $12000 to get a license to practice hair braiding! The bad effects are mostly felt by the immigrant african-americans whose education and skillset is unfortunately low.

    So here in Maldives also, the effect will be the same. Its just that the amounts will be different. And it will become more and more restrictive over time. Do you think if someone wants to go from labourer->mason->supervisor->entrepreneur, putting up legal barriers at each step is beneficial? Yes it is beneficial to the masons that they are insulated from labourers who are aspiring to becomes masons. This is the 13th century medieval guild system.

    And no, the fact that it is practised in the ‘developed’ countries does not negate its negative effects.

    1. Dear Husen… By reading your comments i feel that you are very stupid or working for the Labour ministry of Maldives. Thats why you cannot digest the articles in this forum, please when you read keep a open mind!!

  4. No, the low skilled worker have to worry about the job. His job will be taken by more skilled worker who is currently hunting for the job. Obviously, the skilled one who is already employed won’t go for the minimum wage. The skilled one seeking the job will take the min wage job because it is better for him than having no job.

    If A (unskilled) and B (skilled) applies for the same job which pays the same wage, who do you think will be hired? If only A could legally accept a lower wage, will he be offered the job. Thats the sad reality.

    Licensing of crafts is the other thing that will hurt the labours most! A labourer who have been gaining experience over the years cannot become a mason (even if he learns the skill) unless he is licensed by some authority. This is a huge barrier to people looking to climb up the income ladder. The licensing will be an added barrier. The people who control the licensing will be the existing masons. They will make it difficult new-comers to join the crafts. Yes those who get the license will make more money, but it makes life difficult for the new ones who want to jump that barrier.

    1. As for the workers, the job market will ease quite a bit once the true market condition establish with the phasing out of expatriate labor where supply is existing in the country.
      And Licensing shall not be as restrictive as it currently is. We have to be realistic. This is a 3rd world country and we cannot ask or have ivy league standards here. What we need to do is to overhaul MAB (the recent court ruling on the MAB is a good first starting point.) and the whole structure around it to produce licenses and certification easily to those who qualify which will hopefully address those points raised.

  5. If currently someone is paid 10/- per hour because of lack of skill/education/experience, and if the minimum wage becomes 12/-, he won’t be hired at 12/-. Some one with a bit more skill/education/experience will be hired if the employer has to pay 12/- anyway. Why would he hire the least skilled person? Such a law will be discriminatory towards to least skilled and least educated people.

    It wont cause mass unemployment. It will affect the marginal employees and marginal entrepreneurs. Those who would have gotten hired will be without work. Those small business that are viable at below minimum wage rate will go out of business.

    1. a minimum wage is different from a maximum wage.. suppose the minimum wage was set at 12rf and even then the low skilled persons will not need to worry about his job because the higher skilled person will not settle for a minimum wage.. Also when measures like these are implemented, they will be implemented in such a ways that the purpose of the measures will not be defeated. So in our case the employment ministry might have to deal with the distorted labour market with expatriate labour, the education or trade ministry might have to deal with licensing issues of crafts etc.. there is a lot more to do than to announce a minimum wage.

  6. A universal all region minimum wage law will hurt a lot. It will increase unemployment (or decrease employment) and will raise costs. The effect is mostly felt by small entrepreneurs who start business in the islands. And also by the employees who are the least skilled and who are currently paid below whatever the minimum wage is.

    If minimum wage is such a good thing, why dont we raise it to 100rf per hour? Won’t that solve all the problems?

    1. Thanks for the view and the minimum wage just does not have to be 100rf per hour. It could be based on market conditions now as a benchmark to prevent employers from exploiting labour. Labour in this country is also not cheap. Its difficult if not impossible to find even unskilled labour for an odd job around the house for substantial monies nowadays. As for minimum wage prompting unemployment, this was also forecasted when the new labour laws were passed. Nothing happened and no mass unemployment happened.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s