President Uhuru Kenyatta announced 18 per cent increase in minimum wage during the Labour Day celebrations at Uhuru Park, Nairobi.
Up to KSh100,000 of bonuses and overtime shall not be taxed in order to cushion Kenyans from high cost of living. The minimum taxable salary shall be KSh13,475. The minimum wage, initially at Kenya shillings 10,955, has been raised to Kshs12, 926 (Ugx. 452, 221).
“I am aware that the workers on the lower income bracket are struggling to afford basic necessities and it is not fair that they should be taxed heavily,” Mr Kenyatta said adding that, “all people earning that and below shall no longer be taxed.” said Mr Kenyatta, in a video posted on the Kenya Presidency twitter handle.
“We know that for two straight years we have not increased the minimum wage…after consultations with key stakeholders, I have directed that the minimum wage be increased by 18 percent,”
The move has been described by political analysts as meant to bolster his re-election bid.
According to the Standard, the president said progress to build a prosperous economy to allow Kenyans earn decent living was on course. He underlined current efforts in road construction, lowering barriers to trade, quality education as some of the strategies.
The minimum wage, initially at Kenya shillings 10,955, has been raised to Kshs12, 926 (Uganda Ugx. 452, 221).
In Tanzania, the minimum wage is between TShs100,000 (about 150,000) per month for lowest paid workers in agriculture, domestic servants, and small companies, and TShs400,000 (About 600,000) in other sectors like telecoms, mining, and financial institutions. The minimum wage for a domestic worker/ Maid is between Tshs 40,000 (Ugx. 60,000) and TShs120,000 (Ugx. 180,000).
In Uganda, the lowest domestic workers are paid as low as Ugx. 15,000 per month. Some government workers, including teachers, Policemen earn about Ugx. 250,000 which is about half of the minimum wage in Kenya.
On June 2015, the Permanent Secretary in the Ministry of Labour and Gender, Pius Bigirimana, announced to the 104th Session of the International Labor Organisation (ILO) conference in Geneva, Switzerland that the country was preparing to set up a minimum wage for workers. Two years later, nothing has been done.
The issue of minimum wage is nothing new to Uganda. A minimum wage was last set at Ugx. 6, 000 per month in 1984. Later in 1995, the Minimum Wage Advisory Council recommended that the wage be increased to Ugx. 75, 000 per month for unskilled workers and rolled upwards accordingly. Since then, unionists have been pushing in vain for the government to fix the wage at Ugx. 250, 000 even when parliament voted in favour of a motion moved by MPs Arinaitwe Rwakajara and Paul Mwiru for the minimum wage in 2011. In 2013, the MPs were even granted leave of Parliament to draft a private members’ Bill that would form the basis for the proposed Minimum Wage Bill 2011. However, the Bill has continued to gather dust on the shelves of parliament.
This continued failure by the government to establish a minimum wage contravenes ILO Minimum Wage Fixing Machinery Convention, 1928 (No 26) which Uganda accented to in 1967.
Article 1 of this convention states that “each member of the ILO which ratifies this convention undertakes to create or maintain machinery whereby minimum rates of wages can be fixed for workers employed in certain trades or parts of trades in which no arrangement exists for the effective regulation of wages by collective agreement or otherwise and wages are exceptionally low.”
In 2015, cabinet approved the appointment of the Minimum Wage Advisory Board following a paper presented to the by Muruli Mukasa, the Minister for Gender, Labor and Social Development. Nothing much has since been achieved.
At the latest May 1, 2015, Labour Day celebration in Kisoro District, the president appealed to workers “to be patient” regarding minimum wage. The president has always told its advocates that setting a minimum wage would scare away potential investors from the country. This is despite Kenya and Tanzania, which are the biggest economies in the region, having a minimum wage policy.
He said the government has been working to repair a broken country and needed to prioritise national security, infrastructure, and energy to grow the economy.