CAIRO: Government ministers and labor activists have both rejected the LE 400 minimum monthly wage set by the National Wages Council (NWC) on Thursday. A local NGO said it has filed a lawsuit against the government over the decision.
The NWC set the minimum wage last week after Cairo’s Administrative Court decided that the government was in violation of the law. The Administrative Court initially decided that the NWC must set a new minimum wage based on a modern standard of living, which the NWC had neglected to do for seven years.
The Egyptian Center for Economic and Social Rights (ECESR) announced Sunday that it had filed a lawsuit against Prime Minister Ahmed Nazif, Minister of State for Economic Development Osman Mohamed Osman, and President Hosni Mubarak, describing the recent decision to set the minimum wage at LE 400 as “unlawful and unconstitutional.”
Government-run daily El-Gomhuria said on Sunday that Nazif was scheduled to present “workers’ demands that the minimum wage be increased to LE 500 per month for unqualified workers, LE 700 to those with intermediate qualifications, and LE 1,000 to holders of higher qualifications.”
However, the NWC head, Minister Osman, allegedly said, “We’ll bring over workers from Bangladesh because that would be cheaper and they’d be happy with LE 400 and less,” according to the website of the independent weekly, El-Youm El-Sebaa.
The ECESR has criticized the NWC’s decision to set a gross salary rather than a basic wage, stating that gross wages cannot be set through a government decree. This, the ECESR stated, is because gross wages do not account for wage variables like allowances, bonuses and pay raises that “are difficult to measure [and] regulate.”
“Employers consistently reduce the basic wage and increase variable payments [such as allowances and bonuses] as a means of controlling workers, and as a means of making it easier to punish them,” said an ECESR statement made on Sunday. “According to government estimates, the basic wage only [constitutes] 22 percent of the gross salary.”
The ECESR additionally stated that the aim of setting a minimum wage is to achieve “a balance between wages and prices [that] will ensure a life of dignity for workers.” LE 400 per month in gross salary fails to deliver this dignity since it still places workers below the poverty threshold, according to the ECESR.
The ECESR launched a campaign promoting the establishment of a minimum monthly wage of LE 1,200 in March. This figure is based on ECESR’s calculation of the daily cost of a worker supporting a family of four on $2 per day for a month — the World Bank’s definition of “moderate” poverty.
The ECESR demands in its lawsuit that the government provide documentation that illustrates how the LE 400 monthly minimum wage was decided upon, as well as “why the wage falls below Egypt’s national poverty line of LE 656 per month.”