It is my hope that NLC, the Kaduna State House of Assembly members and other relevant stakeholders would re-channel their focus and energies towards ensuring that Kaduna State government (KDSG) fulfills its promise of expediting the payment of benefits to those entitled following the rightsizing.
Kaduna had recently dominated the news after the country’s main labour group, the Nigeria Labour Congress (NLC), instituted an industrial action in the State, shutting it down for three days. This came as a result of the publicised intention (and in some quarters, implementation) of the Kaduna State government (KDSG) to retrench some staff as part of its Public Service Revitalisation and Renewal Programme. The Kaduna State governor, Mallam Nasir El-Rufai, on several occasions and in press releases had explained the justification for the “rightsizing of the state’s public and civil service”, emphasising that the State cannot sustain the use of 84.97 per cent to 96.63 per cent of its monthly Federation Account Allocation Committee (FAAC) transfers on the settlement of personnel costs.
To understand the situation, let’s do some analysis.
There are majorly two ways by which a State government derives its income – the FAAC allocation and the internally generated revenue (IGR). And the projected population of Kaduna State is about 8.9 million people (Kaduna State Bureau of Statistics, KDBS).
As at March, Kaduna State government published its wage bill, which suggested that the government had in its employment a total civil service workforce of 31,064 staff.
Let’s use the month of March for this analysis: N4.819 billion was paid to the State from FAAC and the IGR target for the year 2021 is N50.6 billion, according to the 2021 approved budget. Since there isn’t any accurate data (publicly published) on the IGR generated for March, we can take an average from the yearly target to ascertain a presumptive monthly IGR value, thereby giving us about N4.2 billion for the month.
In summing the revenues from the two major State sources , i.e. N4.8 billion (from FAAC) and N4.2 billion (from the IGR), we would have N9 billion.
As published by the governor on his Facebook page, N4.498 billion out of the N4.819 billion FAAC transfer was used to settle the total wage bill of the State (excluding Local Government employees). That is roughly 93 per cent of the FAAC allocation.
By extrapolation, that means the wage bill (personnel costs), which ought to be roughly 17 per cent of the total budgetary expenditure (since it is about 50 per cent of the total recurrent expenditure, which is supposed to be about 34 per cent of the total budgetary expenditure), according to the budget, is now gulping 48.9 per cent (almost three times higher) of the total monthly government revenue from FAAC and IGR.
And that means, state civil servants, which are less than 1 per cent of the total population of the State are gulping almost 48.9 per cent of its revenues (from the IGR and FAAC), leaving other government expenses, liabilities (like the overheads, standing orders, security, etc.) and the essential social investments and services for the remaining 99 per cent of the population, with the just the remainder of 51.1 per cent of the total monthly revenue.
Now that doesn’t make sense!
But it’s still a dilemma because we are dealing with people here, and sacking a number of them (even if they are redundant) would mean stripping them off their livelihoods. However, Governor El-Rufai has countlessly asserted that the State government would do its very best to expedite the payment of due benefits to the rested workers. He has also made it public that Kaduna State is executing a number of agricultural and entrepreneurship development initiatives, which the affected people can leverage on.
In one of the statements signed by the governor’s special adviser on media and communications, it was affirmed that the “Government realises that the disengagements may have short-term psychological and financial impacts on the persons to be affected. Therefore, KDSG will not only work with the Pension Fund Administrators (PFAs) to expedite payments of any contributory pension benefits due to those so entitled to them but will also give preferential treatment to those disengaged that are willing to take advantage of the state government’s various agricultural and entrepreneurship development schemes.”
The NLC was expected to complete the five-day warning action, and it was also expected to hold the conciliatory meeting with government while still observing the strike (or perhaps do a partial call off targeting sectors like power supply). This would have established an impression of strength and determination. However, their withdrawal gave an impression of weakness…
Despite the above, the NLC went on a five-day warning strike. And the aim was basically to challenge the legality of the rightsizing process and force the governor to backtrack from implementing the said public and civil service rightsizing. The governor, however, had made it categorically clear that nothing would force him to backtrack. This generated a serious rift between the two parties.
However, the strike has since been called off due to an intervention by the Federal Government through the Ministry of Labour, and a conciliatory meeting has already taken place.
It is on this basis that people are asking: Who is the victor and who is the vanquished in the impasse?
First, when NLC announced the commencement of the strike, its leaders categorically stated that the warning strike will spill over to a total one if there is no remorse on the part of the state government. However, the NLC suspended the strike before the five days were through, and this was not because the State government “showed remorse” but due to the intervention of the Federal Government. However, an intervention by the Federal Government is in no way a warranty of the outright suspension of the strike, especially a warning industrial action that was stipulated to hold for a certain number of days. ASUU, for example, has entered into countless dialogue sessions during the period of its industrial actions but never backed out until an agreement was struck.
The NLC was expected to complete the five-day warning action, and it was also expected to hold the conciliatory meeting with government while still observing the strike (or perhaps do a partial call off targeting sectors like power supply). This would have established an impression of strength and determination. However, their withdrawal gave an impression of weakness, especially as it came just two days to the due date. And it gave Governor El-Rufai an advantage to capitalise on.
Secondly, it was established during the conciliatory meeting that the “impasse was caused by communication gap between the State Government and NLC occasioned by both the local chapter and even the Kaduna State Government Officials”. NLC alleged that the issues that led to the strike included, “Retrenchment of workers by the Kaduna State Government; Compulsory Retirement of workers on Grade Level 14 and above; Compulsory Retirement of workers who have attained the age of 50 years, irrespective of their Grade Levels; Reduction of the staff strength of Local Government to 50 in each of the 23 Local Government Areas (LGAs); and Casualization of workers on Grade Level 1-6”.
The Kaduna State officials, however, debunked all the five issues raised, tagging them as mere propaganda driven by the political opponents of the current leadership of the state government. This suggests that NLC acted on unsubstantiated information, as communicated to it by “Kaduna State affiliate Unions and Negotiating Councils”.
Yet, even before the strike commenced, KDSG had countlessly debunked the above raised issues through several press releases and media chats. In one of such press releases, the governor’s SA on Media and Communications stated that, “The stories circulating in the social media about pruning local government personnel to 50, converting junior staff to casual staff and the like are false and should therefore be disregarded. These false claims are a rehash of the contents of a forged letter that was circulated just prior to the 2019 elections”. Going ahead to act on the basis of misinformation, even after this was already debunked, was obviously another flaw on the part of the NLC.
Thirdly, in the same meeting, it was clearly established and resolved that an employer holds the right to retrench workers for as far as due process is followed. KDSG had however made it clear on several occasions that, “Each and every decision taken will be in full compliance with the Kaduna State Public Service Law and any regulations made pursuant thereto, and other extant laws.”
Lastly, the major takeaway from the conciliatory meeting was the resolution that the government must adhere to and comply with the “Principle of redundancy”, as enshrined in section 20 of Labour Act, Cap L 1 Laws of the Federation of Nigeria (LFN), while executing the rightsizing. And a lot of people think this is a win for the NLC, if this provision of the Labour Act can actually force the governor to abandon his rightsizing mission.
…I think the major point of concern should be how to ensure that the retrenched workers are paid off handsomely and expediently. And this is the aspect the NLC ought to strategically hammer on. The government has already pronounced that it would work “with the Pension Fund Administrators (PFAs) to expedite payments of any contributory pension benefits due to those so entitled to them”.
Section 20 of Labour Act, Cap L 1 Laws of the Federation of Nigeria (LFN)states that;
(I) In the event of redundancy –
(a) the employer shall inform the trade union or workers’ representative concerned of the reasons for and the extent of the anticipated redundancy;
(b) the principle of “last in, first out” shall be adopted in the discharge of the particular category of workers affected, subject to all factors of relative merit, including skill, ability and reliability; and
(c) the employer shall use his best endeavours to negotiate redundancy payments to any discharged workers who are not protected by regulations made under subsection (2) of this section.
(2) The Minister may make regulations providing, generally or in particular cases, for the compulsory payment of redundancy allowances on the termination of a worker’s employment because of his redundancy.
(3) In this section “redundancy” means an involuntary and permanent loss of employment caused by an excess of manpower.
By analysing the laws critically, one would notice that almost every provision in the redundancy section favours El-Rufai and the KDSG.
For example, the definition of redundancy, as provided in Nigeria’s Labour Act is too broad, hence, subject to different interpretations. This is unlike in the laws of other countries like the United Kingdom, where the definition of redundancy covers and specifically spells out almost every possible situation that could lead to loss of employment. This gives KDSG the advantage and opportunity to define redundancy in such a way that suits the objectives of the state government’s Public Service Revitalisation and Renewal Programme.
Secondly, the “Last in First Out (LIFO)” principle is also looked upon as a provision that could prevent KDSG from rightsizing the civil service (as it has already started this), because due to this principle, most of the employees that KDSG is targeting for retrenchment would be somewhat protected. The principle provides that retrenchment should be done in such a way that the last person employed gets retrenched first. However, further in the subsection, it states that the adoption of the LIFO principle is “Subject to all factors of relative merit, including skill, ability and reliability”. This “relative merit“ condition renders the subsection less rigid, as an employee who is last to be employed might possess a higher level of skill, ability or reliability and in this case would be retained, while some of those employees who were employed before him but do not hold the relative merit advantage, would be susceptible to retrenchment. This, therefore, is also another advantage El-Rufai can leverage on to reaffirm his current stand on the rightsizing process.
Thirdly, while the law speaks of the redundancy payment, it still does not stipulate the detailed procedure of the redundancy/severance payment calculation. This is also unlike labour laws of other countries like the United Kingdom. Although the subsection stipulates that, “The Minister may make regulations providing, generally or in particular cases, for the compulsory payment of redundancy allowances…”, it has been established that there are currently no regulations made by the minister “which regulates or gives a guide on redundancy process and the calculation of redundancy sum in Nigeria pursuant to the provision of S20 (2) of the Labour Act”. This is also another advantage to KDSG as NLC would have no option but to accept the State government’s preferred mode of redundancy payment, since there’s no clear regulation or compensation guide in this regard.
Having done the above analysis, I would leave the verdict of who the victor and who the vanquished is between NLC and KDSG to the reader.
But while you do that, I think the major point of concern should be how to ensure that the retrenched workers are paid off handsomely and expediently. And this is the aspect the NLC ought to strategically hammer on. The government has already pronounced that it would work “with the Pension Fund Administrators (PFAs) to expedite payments of any contributory pension benefits due to those so entitled to them”. The government had mentioned that its commitment towards the clearing of gratuity and death benefit backlog that had piled up since 2010 and is to the tune of N13 billion is a testimonial of its determination to pay benefits to those entitled. It had also mentioned that there are relief systems in place, as the government has made provision for a number of agricultural and entrepreneurship development schemes like the Kaduna Start-Up and Entrepreneurship Programme (KADSTEP), the Kaduna State Women Empowered Programme (KADSWEP), AGRA, Kaduna State Agro-Processing, Productivity Enhancement and Livelihood Improvement Support (APPEALS) etc. that the victims of the rightsizing could particularly leverage on.
It is my hope that NLC, the Kaduna State House of Assembly members and other relevant stakeholders would re-channel their focus and energies towards ensuring that Kaduna State government (KDSG) fulfills its promise of expediting the payment of benefits to those entitled following the rightsizing. It is also expected that they would rigorously embark on educating and orienting the victims on the several development schemes and the process for application and ensuring that they leverage on these opportunities to mitigate the resultant strain from the sudden loss of their employments.
Abdulhaleem Ishaq Ringim, a political and public affairs analyst, writes from Zaria and can be reached through email@example.com
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