Nigeria employers Consultative Association’s (NECA) Director General, Segun Oshinowo believes the Nigerian economy will in the nearest future bounce back, especially with the introduction of the flexible exchange rate by the Central Bank of Nigeria (CBN). He said the move would open up the economy as more investors would come into the country. He also speaks on the running battle his organisation, as representative of the employers, has been having with the Minister of Labour and Employment, Senator Chris Ngige, based on the current mass sack in the banking sector. Oshinowo insists that the employers in the sector have not erred in the retrenchment exercise. As one of Nigeria’s delegates at this year’s International Labour Organisation (ILO)’s 105th Conference in Geneva, Switzerland, the NECA boss equally speaks on the gains of the conference.
What is your take on the new foreign exchange rate policy of the CBN?
It’s one policy that has been delayed, but I am so happy that government is beginning to see the sense in allowing some partial floating of the currency, so that our currency can attain it’s appropriate value. But the question people will ask is what is the advantage in that? Because certainly, this flexible foreign exchange disposition is going to lead to official depreciation of the value of the naira. But we shouldn’t look at the loss of purchasing power which that will foist on Nigerians. We should equally look at the upside of inflow of capital to Nigeria by foreign investors. Because many foreign investors have actually suspended key decisions on investments in Nigeria, until they are cleared, what the duration of Nigeria foreign exchange would be in terms of the value of the naira. Having tidied up that policy now, I think we are likely to experience what I considered to be positive inflow of investment into our economy, which is extremely important to promote growth and provide jobs for our youths.
How soon do you think that the economy will rebound?
I think we need to wait a while, except there is a significant rebound in the price of crude oil. You don’t diversify your economy overnight. Policies and measures that are required to diversify the economy, are measures and policies that will give one desirable results in a medium term rather than in a short term. While you can take policy decision and follow up on policy implementation in the short term, the actual outcome will only be in the medium term. If that is then the case, it means that to have a respite, there must be significant rebound in the price of crude oil in the short term. And what time frame, will I want to put to short term, 12- 18 months.
You seem to support the mass sack in banks, why?
The first thing we must realise is that there is no well meaning employer or a decent employer or an employer that is focusing on wealth creation that will intentionally declare its employees redundant. There are no economic reasons for that. Employers are rational enough to know that the human assets they have invested in over time, will be required for them to achieve their objective of wealth creation. So when you find an employer moving in the direction of rationalisation of staff, it is on account of so many factors, one of which could be the unhealthy state of the economy, particularly if such incident or event is pervasive as we are now experiencing. It would be so easy to link it to the parlous state of our economy. And we all know that in the past twelve months, our government has come up with quite a number of policies. Sectors specific policies, that have touched this particular sector we are talking of, the banking and financial institutions. It has affected their top line, it has affected their bottom line and they are struggling to survive, and when you are struggling to survive, you have to look at measures internally, to make sure that your leg stays above the water. It is one of such measures that has led to this massive and pervasive retrenchment in the financial sector. It is very important for us to understand that dynamics of business. The second issue is that, in employer-employee relationship, which equally recognises the regulatory and superintendent responsibility of government. The legal framework for this will be the starting point in determining what is right and what is wrong. And such framework cannot be subjected to the opinion of any one party. Because the legal framework is a legal framework, any opinion, any comment, any directive, that does not fit within the contest of a framework is absolutely illegal and it is not binding on all the party that are involved, whether the party is the union, the employer or the government. Any action that falls outside that legal framework or the practice of industrial relation is not binding, and that really is where our grouse is with the minister, because the minister’s directive is outside the legal framework for the practice of industrial relations, which have stated out clearly the rights of every parties that are involved. And for the employers, one of such rights is the right of the employer to carry out retrenchment as at when necessary. And that same framework is quite explicit about the procedure which the employers has followed. In which case, it is only when the employers have erred in not following the procedure as stipulated by the law, that the regulator or the supervisor or the superintendent can come around to say that employer you have erred in law. But our system of industrial relation is so robust that even if the employer has erred the law, the legal framework has articulated the procedure which the regulator must follow to sanction the erring employer, and in all that the minister erred. And if as employers we keep quiet, we will be setting a dangerous precedent for the practice of industrial relations in Nigeria.
Didn’t the sack violate the practice of collective bargaining?
This might be hard, but that’s why it’s the truth, when the minister spoke, it’s out of ignorance about system of collective bargaining and applicability of collective bargaining agreement. First, one can talk of collective bargaining and collective bargaining agreement where a union exists. If a union does not exist, you cannot talk of collective bargaining. Because the union is the the organ that has the power to represent the workers. Some of those organisations where redundancy has been carried out, there are unions on ground. Now if there is no union on ground, and the employer wants to carry out retrenchment, will the employer now go to the television station to say, union does not exist in my enterprise, we are waiting for the union to come and organise our workers before we carry out retrenchment. It’s never done like that, that’s one aspect of it. We agree with the facts that the redundancy benefits is a justifiable right for an employee. Whether that justifiable right has been firmed up through the machinery of collective bargaining or through the individual contract of employment between the employer and the employee, is a different matter completely. But the real issue is that any employee that has suffered the incidence of redundancy is entitled to redundancy benefit. In which case, which again showed the ignorance of the minister in labour relations matters. It is not only through the machinery of collective bargaining or CBA, that an employee can have access to his justifiable right of redundancy benefits. I actually expected the minister to have pointed that out and ensure that he protects the benefit rights of those retrenched. If they don’t have union in place, the minister should have prevailed upon the companies to show the proof of paying redundant benefits to the workers being laid off, as stipulated by law. As we have pointed out in our press release, industrial relations, is not a pedestrian discipline where anybody can just give an opinion or a view no, it has its own body of knowledge. You have to be grounded in that body of knowledge, for you to make sense when you are talking.
What about the proposed July meeting and punishment on erring banks by government?
Arrant nonsense! Absolutely nonsense. The law is very elaborate in terms of the power of the minister. The law is very elaborate in terms of the rights of the parties involved in a dispute. What we have clearly now, is a dispute situation. The minister had not even called the employers to hear their own sides of the story. So slating a meeting for July is absolutely wrong. Because there are two aspects to it. Every union has its own scope, if I do not belong to your club, ordinarily, I should not derive benefit from your club. But if I now call on you to say am in distress, come and help me. That will be a different matter completely. Most of those employees that have lost their jobs, are not members of the union. So if you as union you are coming to me as employer, I will demand to know you. But that will be fair, how can I be talking to somebody that I don’t know. For the union to talk to the employer, they must be able to establish that the workers are members of the union. We don’t need to be emotional about this, which is why my position constantly has been to look at the legal framework. The rights that has been conferred on us by our laws. So that when we want to act, we are acting within the context of the law. As an employer, I will not entertain any union coming into my bank as an interloper to discuss about my employees, who are not its members. In fact it would be appropriate for me to call the police for encroaching on my territory.
But some employers deny workers their right to form unions
As employers body, we support the ILO’s Convention 87 of freedom of association. We fully support the Nigeria Trade Union Act, which has conferred on every employee in Nigeria the right to belong to union. But as employers, we will not organise our employees for the unions. It is the responsibility of the union to identify its members wherever they are and organise them. And if for any reason the union is experiencing difficulties or obstacle in organising its members, our law has anticipated that, the union can make it an issue of dispute where it’s finding it difficult to organise its members. That’s why we have the National Industrial Court (NIC), the court will invite the parties and look at the facts and then determine whether the employer has erred by preventing the union from organising its members. What I would have expected the union to do, is to provide evidence that it has gone to the NIC to pursue its legitimate right to organise its members wherever they are. But what we have is allegations, which are not founded, it might be true. I am not saying it might not be true, but has the union gone an extra mile. When Adams Oshiomhole was the president of the Nigeria Labour congress (NLC), I know what we did together. In 2001, when one of the banks was alleged to have encouraged its employees to resign from the union, Adams and I met with the Managing Director of the bank, Mrs Agary then was the permanent secretary, we came up with a formulation, when the bank saw where we were going and discovered that it would be exposed, the bank backed off. Because we were to conduct what we call anonymous referendum. There are ways out of this, there are social solutions out of this, and there are legal solutions out of it. My own admonition of the union is that they have not explored the boundless options, both the social solutions and the legal solutions.
Don’t you think the minister’s action was aimed at stopping workers’ enslavement by employers?
My message to the minister is that, he should be patient and be humble enough to take himself through basic tutorial courses in industrial relations and labour laws. The minister should also cease from making utterances that could embarrass the present government. Until he has done that, alternatively, get his director of industrial relations to speak on those issues. But most of the positions and comments that the minister makes from time to time, I am sorry that am saying this, are simply borne out of ignorance. Absolute ignorance. You are the minister of labour, you have labour inspectorate division, you have factory inspectorate division, and you are saying they are treating Nigerians as slaves. What have the inspectors been doing all along. The Minister indirectly was reporting to the world that our inspectorate division has been ineffective. Because that is the whole essence of inspectorate and the employers will not shut their doors to the inspectors. What have the inspectors been doing? So the inspectors have been condoning slave labours all these years. Our minister should just refrain himself from making uninformed statements, which is indicting of the ministry.
What are the gains from this year’s ILO conference?
Two things right away, as we all know, when Nigeria’s case was tabled before the committee on application of standards, where we were held in contravention of the convention on child labour, the conclusion of that discussion is something that we must have a meeting on, because it’s not too good for us as a country to be indicted on this issue of child labour. Of course, the three points conclusion were that Nigeria should ensure that every child under 15 years is in school. The second issue is that the tripartite constituents should work together to reduce the incidence of child labour.
The other aspect of it, which is of importance to us is the general discussion on decent work in a global supply chain. Since we begin to have an expanded scope of outsourcing, offshoring, short term contracts, temporary contracts in Nigeria, I think it will be important also for the tripartite constituents to take a look at the general conclusion and not wait until the time when ILO will come up with an instrument and see how we can use the general conclusion of that discussion to improve the working conditions in companies that are part of that global supply chain.