IMELDA AMBONDO
Trade Union Congress of Namibia secretary general Mahongora Kavihuha said the government’s decision to ban companies that break the national minimum wage from receiving tenders is long overdue.
The Ministry of Finance this month issued a directive aimed at enhancing compliance with the national minimum wage order across all public procurement processes. As of 1 January 2025, Namibia’s minimum wage is N$18 per hour for most workers.
The directive mandates that all public entities award procurement contracts that involve an employment component exclusively to bidders or employers who fully comply with the national minimum wage.
For years, unions have complained that companies, especially in sectors like security, have been violating minimum wage and collective agreement rules, yet the government continued awarding them tenders. Kavihuha told the Namibia Business Review this week that the new directive could have a good spin off for workers.
“The government’s pronouncement is a welcome move, but to us it is long overdue. Compliance should not only be about the national minimum wage; it must include all workers’ rights violations,” he said.
Kavihuha said companies showing hostility towards trade unions and refusing social dialogue are often the ones failing to honour gazetted laws. “Every company must adhere to the Labour Act before it can qualify for any government tender,” he added.
Kavihuha said that mechanisms to enforce labour laws already exist, but the new approach is a good start. “Labour inspectors are overstretched, one inspector covers a huge area with many companies, so enforcement has always been limited. This new measure fills some of those gaps,” he said.
He warned that enforcement will still face challenges, relying on inspectors, unions, and proper verification. “We need to embrace social dialogue. Employers, workers and unions must talk to each other and appreciate each other. Hostility is what leads to non-implementation of important decisions,” Kavihuha said.
Kavihuha called for genuine wage adjustments, noting that the minimum wage of N$18 per hour, introduced four or five years ago, should now be at least N$25 or N$30 per hour. “We cannot waste time. Next year negotiations to adjust the minimum wage should start immediately because workers and society are suffering,” he said.
The Ministry of Justice and Labour Relations has also welcomed the decision.
Ministry of Justice and Labour Relations Executive Director Audrin Mathe said all procurement contracts involving labour must now include a clause allowing immediate termination if a contractor is found to be non-compliant with the national minimum wage.
“Any bidder found to violate the national minimum wage provisions will be disqualified from the procurement process or face immediate termination of their procurement contracts,” he said.
Mathe said public entities must notify the ministry before awarding contracts to verify compliance.
“This is necessary for the ministry to verify and confirm their compliance status, leading to a decision by the responsible entity whether or not to award a tender,” he said.
Mathe said the government, having a significant portion of national economic activities through public procurement, strives to apply the same standards across all public entities.
“This is to prevent bidders from shopping around for lenient public entities,” he said.
Therefore, Mathe says, it’s crucial for all public entities to pull forces together towards this harmonised approach and implement the directive with urgency and uniformity. “…in order to protect workers from exploitation while at the same time paving the way for a more improved basic standard of living, promote decent work, and advance social justice.”
“We reiterate our call to all employers to comply with all provisions of the national minimum wage as a sign of commitment towards respect for the dignity of workers,” said Mathe.
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