Key Finding - 1. Fair Wages

KEY FINDINGS

This section addresses the findings of the Labour Rights Index 2020 by studying the national labour legislation of 115 countries. Please refer to Appendix IV for tables of Key findings with names of countries.

1. FAIR WAGES

A. MINIMUM WAGE

At a global level, more than 85% (101 countries) of the countries considered in this Index have statutory provisions on setting and revising minimum wages. Nearly 8% (9 countries) in this Index fix their minimum wages through collective bargaining, either at the sectoral or national level. Most (6 out of 10) are in Europe. Around 4% (5 countries) have no provision on minimum wage. 

A vast majority of countries in Africa (29 countries – 85%) sets the minimum wages through legislation. Three countries in Africa, namely Chad, Namibia and Zimbabwe, set wages through collective bargaining. Ethiopia and Sudan have no provision on minimum wages. 

Similar is the case for Asia where 90% (27) countries have statutory minimum wages. None of the countries from Asia considered under this Index, has collectively negotiated minimum wages. There are three countries, Bahrain, Singapore and Yemen, with no provision on minimum wages. 

While most of the countries in Europe set wages through legislation (28 countries – 82%), the remaining countries fix and update wages through collective bargaining. These are Austria, Denmark, Finland, Italy, Norway and Sweden. 

All 15 countries from the Americas fix their minimum wages through legislation. Similar is the case for Oceania.  

As regards the last update of minimum wages, a majority of countries (79%) have updated their minimum wages, whether statutory or collectively negotiated, during the last two years. Nearly 16% (18 countries, of which 11 in Africa) have not updated their wages during the last two years. There are six countries, with equal distribution in Africa and Asia, with no provision on minimum wage updates.  

B. REGULAR WAGE

An overwhelming majority of countries (97%) require regular and timely payment of wages to the workers, with legislation requiring wage payment periods to be set at an hourly, daily, weekly, fortnightly or monthly level. One country each from Americas (Peru), Europe (Greece) and Oceania (New Zealand) does not require regular payment of wages in its labour legislation. Instead of setting a wage payment period, the issue is left to mutual agreement between the parties.

C. OVERTIME PREMIUM

More than 80% of the countries (96) require the wages for overtime hours to be at least 125% of the regular hourly rate. There are seven countries, mostly in Africa, which require an overtime rate of less than 125% of the regular hourly rate. Some countries determine the overtime rates through collective agreements, including Nigeria and Rwanda from Africa, and hence no rates have been specified. For countries where minimum wages are determined through collective agreements, overtime rates have been taken into account from the most representative sectoral collective agreement. A limited number of countries, i.e., Ghana, Ireland, New Zealand, and the United Kingdom have no provision on overtime premiums. 

D. WEEKLY REST WORK COMPENSATION

More than 40% of the countries in this Index (51 out of 115) require a compensatory rest day or time-off, as well as a premium payment, for those workers working on weekly rest days.  The remaining countries either require a premium payment (28 countries), or workers are given a choice between time off and premium payment (21 countries). There are 15 countries, of which 9 in Africa and 4 in Asia, where there is no provision for weekly rest day work compensation. 

E. NIGHT WORK PREMIUM

Nearly 60% (68) of the countries require additional monetary compensation or reduced working or a combination/option of both. The remaining 47 countries have no provision on monetary compensation or reduced working hours for night work. More than 70% of “No Provision” countries are from Africa and Asia. A limited number of countries from Europe (6 countries) and the Americas (Brazil, Honduras and Paraguay) require both the premium payment and reduced hours for night work. Italy, Romania and South Africa give an option to choose from reduced working hours and premium payment.