How salary structure can be improved in the private sector. There is a disturbing arbitrariness in the salary structure in the private sector in Nigeria. It is crystal clear that most business and private institutions do not have the financial muscle to mirror the public sector salary wise. Still they could do better than what obtains at present. One than is left to ask, what could be done to improved the salary structure in the private sector?
First lets start with the legislature. Needless to say, the capacities of many business in most parts of the country cannot survive if they were to adhere to the minimum wage. Even those with at least 25 employees(as was recommended) have still fallen shot. The legislature (federal and state) should look into setting the minimum wage for the private sector. But then, a bank in the lagos island and a private primary school somewhere in saki East are both private institutions. So there should be on exemption of corporation from such because they are capable of paying just as much or more than the government. Like in the U.S, there should be different benchmark for economy and other factors.
Conscious Efforts on the Part of Governments
Second, before attempting the above, there should be conscious efforts on the part of governments, to boost of private business. Grants, bail out funds, loans, Etc. should be made available by government to encourage private star and to bolster already existing business. This could result in the growth and greater profitability of private institutions, and invariably, a raise in the income of their employees.
Third, all thing being equal, there should be friendly auditing of the account of private institutions. With this, there could be a determination of the proportionate of the employees. Where these earning are not proportionate, such business should be made to face sanctions. One could then ask, how is the proportionality to be decide? It is a common practice among business to maintain a very rigid pay structure. A business started five years ago with ₦10,000 salary for workers, five years after that still stands even when the profit margins and the business financial standing has increased a hundredth fold. In this scenano, it is clear that, there is no proportionality between the business earnings and its employees incomes.
Corporate Laws to Increase the Right of Workers
Fourth, there should be corporate laws to increase the right of workers. In some private institutions, people work for mouths without pay and they cannot resign because that would be than forfeiting the whole months’ salaries. They have no choice but to put up with this because they have no one to complain to who cold legally act on their behalf. There should be, like in the public sector, a union among workers in the private sector. They should have a legal body that looks after their affairs and welfare.
Finally, the salary structure in the private sector would stand to improve with stronger policies on the part of governments on the registration and establishment of businesses with intentions to employ a certain number of workers. It is at this stage that government would be able to decide the viability of the proposed business with an examination of its plan and financial strength. Any proposed business which fails to meet the minimum requirement should not be allowed to operate unless they can assure that whatever happens to the business, it would be able to meet its financial obligations to its employees.