Minimum wage to be decided by Economic Minister

A bill proposing amendments to the Employment Act which empowers the Economic Minister to establish a minimum wage has been submitted at the Parliament.

According to the bill proposed by the government and sponsored by Kendhikulhudhoo MP Ahmed Easa, it is mandatory for the government to establish a minimum wage. However, the bill does not call to impose specific amounts as minimum wage.

The bill further states that the minimum wage will be decided by the Economic Minister based on the recommendation made by the advisory board established to provide counsel on the matter. The bill stipulates the formation of the advisory board within 30 days of the ratification of the bill.

The bill proposes to have seven key industries assessed separately, and for the advisory board to recommend a minimum wage for each sector. The industries are the fishing and agriculture industries in addition to tourism, construction, transportation, health, education industries and SMEs.

The bill calls for four members representing the tourism, construction, women-owned businesses, and SME organizations to sit on the advisory board, in addition to five members from labour organizations.

While a person chosen by the Economic Minister will sit on the board as its chairman, a person chosen by the Finance Ministry must also sit on the board, the bill proposes.

The bill also proposes to review the amount established as minimum wage every two years. The board can recommend the Economic Minister to revise the amount set as the minimum wage if necessary. The minister can review the figure even before two years pass based on the country's state of affairs at any given time, says the bill.

When deciding on the minimum wage, the expenses incurred to fulfill the basic needs of an employee's family, economical expenses, living expenses, and the incentives received by families for social protection will be taken into consideration. The board will also take into account the GDP, and other employment policies when recommending a minimum wage, the bill says.