Falling short: Egypt’s new minimum wage, the haves and have nots

Tens of thousands of workers, employees, professionals and even policemen are embarking on strikes and other industrial action across the country to demand the new minimum wage, which the state had officially established in the public sector as of the end of January.

These industrial actions appear to be growing and spreading nationwide with each day.

Amidst a great deal of fanfare and talk of social justice from government officials, the new minimum wage of LE1,200 (roughly US$172) has been allocated only to the public sector – and not all public sector workers or employees for that matter.

The new monthly minimum wage has been made available to some 4.9 million workers of around 7 million employed by the state and public sector workers. Egypt has a total workforce of over 27 million, most of whom are now being denied this new minimum wage.

Saud Omar, labor consultant at the Suez Regional Workers’ Federation, pointed out that only around 18 percent of Egypt’s workforce is legally entitled to this minimum wage.

“This so-called national minimum wage should not be referred to as such. It is not applied on the national level or across sectors, and it is not the starting basic wage which new workers are paid,” Omar explained.

“Instead it amounts to a total wage or a total income of LE1,200 – this includes bonuses and pay-raises,” he said.

Moreover, in light of increasing inflation, and since the 2011 uprising many employees have been demanding the minimum wage be set at LE1,500 – rather than the outdated demand for LE1,200.

Officially proposed late last year by the Ministries of Manpower and Finance, then approved by the Cabinet in the form of a cabinet decree, the state has allocated an additional LE9 billion to its annual budget so as to raise millions of its employees’ incomes – in line with the LE1,200 minimum income.

The state has even enshrined the minimum wage, along with a minimum pension and a maximum wage, in its new national constitution.

Minister of Manpower Kamal Abu Eita has considered this new minimum wage/income to be a realization of Egypt’s revolutionary demands: ‘Bread, Freedom and Social Justice.’

During a press conference held on December 18, 2013, Abu Eita said, “We have struggled to realize the slogan: A minimum wage for those living in cemeteries, and a maximum wage for those living in palaces.”

Abu Eita clarified that in Egypt, “National incomes are determined on the basis of 20 percent basic wages, and then around 80 percent from bonuses.”

During this conference Abu Eita said, “This is the highest minimum wage that the state can provide from its coffers under these pressing economic conditions.”

The minister added that the minimum wage should be raised in line with inflation.

However, the demands for a national minimum wage of LE1,200 date back to December 2006 during a massive strike in Egypt’s largest textile company, the Misr Spinning and Weaving Company in Mahalla city.

Nonetheless, over seven years later, the workers at Mahalla still have not had their demands realized. An estimated 20,000 workers have launched a strike this week calling for the payment of the new wage, among other demands.

The average monthly total wage for a fulltime worker at this company currently still averages around LE600 to LE800.

Sayyed Habib, a strike leader at the Mahalla textile company in December 2006, recalls, “It was back during this strike that we first raised the demand for a minimum wage of LE1,200 per month. This was our primary demand years ago.”

“Yet history keeps repeating itself, and our demands keep being ignored,” he added. Habib retired from the company and is now employed at the independent Center for Trade Union and Workers Services.

“We had calculated the LE1,200 based on monthly living expenses several years ago. Now price increases have rendered this sum outdated and insufficient,” he said.

Habib pointed out that the monthly rent for a small apartment in Mahalla costs no less than LE500 per month. “If an able-bodied worker is left with only LE700, how can he feed his family, educate his children, or save for retirement. It’s simply not feasible.”

“Of course the monthly LE1,200 is now too little, and it is late. But it would nearly double the workers’ existing wages, and that would be warmly welcomed, he added.”

Habib said he aspires to see LE1,200 being paid as basic minimum wage, with the real minimum income amounting to LE1,600 or more.

Elsewhere, doctors, pharmacists and veterinarians employed at the Health Ministry’s medical facilities are still engaged in partial strikes across the country, since they initiated their protest actions last month. These medical professionals are demanding salary increases in line with the new minimum wage decree, amongst a host of other healthcare-related demands.

Joining in the medical syndicates’ strikes this week were health insurance employees in the governorates of Beheira and Daqahliya, who also demanded to be paid the new minimum wage.

This week custodial workers in Monufiya are on strike demanding fulltime contracts for fulltime work, along with their payment of the new minimum wage.

Even policemen protested in Gharbiya and Alexandria demanding the minimum wage. Policemen’s partial strikes were reported in Sharqiya, Minya and New Valley governorates.

Meanwhile, in Qalyubiya police forces were deployed to contain a protest by field surveyors’ in the city of Banha, who are on strike in demand of the minimum wage. Other public sector surveyors went on strike in Minya, Damietta, and Beheira calling for the same demand.

Employees of the state-owned Omar Effendi department stores have also been protesting and calling for the minimum wage; along with public transport employees in Cairo and Alexandria.

Public bus drivers are threatening to launch a nationwide strike by the end of February if they are not granted this new minimum income.

According to bus driver Ali Fattouh of the Public Transport Authority (PTA), “We’ve been demanding LE1,200 as a basic monthly wage since the year 2007. We’ve launched several strikes for this specific demand, yet we are amongst the many sectors of public employees who are being excluded from receiving this minimum wage.”

Fattouh explained that amongst the some 40,000 PTA employees across Greater Cairo, the average total monthly income is between LE600 to LE1,500.

Fattouh commented that “the government’s lack of analysis and consultation with workers and their unions naturally means that there is a lack of proper implementation and distribution of this minimum wage. This will only lead to further unrest, protests and strikes amongst workers demanding the receipt of this minimum wage.”

Omar agreed. “Grievances regarding the non-payment of this LE1,200 will inevitably lead to additional unrest within the public sector and state-owned companies, which are excluded from receiving the minimum wage. These grievances and unrest will also spread to different industries, different economic sectors and services. All will be demanding the minimum wage on which they can subsist and meet their most basic demands.”

Omar went on to point out that hundreds of thousands, if not millions, of fulltime workers are employed within the public sector on part-time contracts. The lack of fulltime contracts means that the employer is exempt from paying these precarious workers on par with those who have fulltime contracts.

This policy of fulltime employment on part-time contracts is common in both the public and private sectors. Employers have used this policy to guarantee that such employees are denied periodic bonuses, membership in their local union, insurance payments – and now they may also be denied the minimum wage. 

Jano Charbel 

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