Leaked COLA instead of 2024 Salary Increment for Public Sector Workers Organised Labour React
Leaked; COLA instead of 2024 Salary Increment for Public Sector Workers -Organised Labour React
Accra, 18th August, 2023 -Organized Labor has voiced its opposition to the government’s leaked plan of introducing a Cost of Living Allowance (COLA) during the forthcoming salary negotiations in 2024.
Instead, the Labor group is advocating for a direct increase in the salaries of public sector employees, rejecting the concept of a short-term COLA.
The COLA, typically implemented when immediate salary hikes are unfeasible, has been met with resistance from Organized Labor due to its perceived lack of impact on pension disbursements and other associated benefits.
Joshua Ansah, Deputy General Secretary of the Trade Union Congress (TUC), spoke to the press in Accra, emphasizing the preference for a salary rise over the implementation of COLA. He articulated, “Opting for COLA does not align with our pension and earnings concerns.
We believe pursuing a direct salary increase is more appropriate. Furthermore, in the event that the government engages with the IMF, we urge that such negotiations should not compromise our country’s minimum wage.”
4% and 7 % Scrutiny
Union leaders faced scrutiny from members when they agreed to a 4% and 7 % salary increase, while other sectors got a substantial 77% raise.
Teachers, especially, went on strike to ask for a cost of living allowance (COLA). Eventually, a 15% COLA was given to all public sector workers 15% CoLA to be paid by Government;
This was influenced by the situation in 2022, when inflation rose sharply, making the cost of living very difficult for regular Ghanaians.
During salary negotiations, the Unions were successful in securing a 30% salary increase for all public sector workers for 2023, along with the removal of the COLA provision. 30% Conclusions made on 12th January Public Sector Base Pay Negotiations
2024 Salary Negotiations
Now, as salary negotiations approach again, there’s growing pressure on the government to start talks before it becomes too late. These negotiations can be quite intense for the country.
Some workers are already suggesting that the union should demand a 55% increase from the beginning and stick to that demand. Start the Negotiations for better conditions of Service and Salary from 55%; Teachers to Union Leaders
If the government introduces COLA instead of directly negotiating a salary increase, it could be seen as an attempt to deceive public sector workers, even if a 40% COLA is offered which will not happen.
Before Accepting COLA instead of Salary Increment Explore the following Disadvantages of COLA over Salary Increment.
While Cost of Living Allowance (COLA) can provide short-term relief to workers, there are several disadvantages to opting for COLA over a direct salary increment:
Disadvantage of Cola over Salary Increment
Temporary Nature:
COLA is typically a temporary adjustment made in response to rising costs of living. It doesn’t permanently raise the base salary of workers, leading to ongoing financial uncertainty and potentially creating the need for frequent adjustments. Will Government always adjust Up?
No Impact on Pension and Benefits:
COLA usually doesn’t affect pension calculations or other benefits that are often tied to the base salary. This can lead to a discrepancy between the pensions received by workers and the actual cost of living, potentially affecting retirees negatively.
Reduced Long-Term Earnings:
Without a direct salary increase, workers miss out on compounding effects that higher base salaries can have over time. This can lead to a significant disparity in earnings over the course of their careers. meaning in 2025 the increment will be based on 2023 Base Pay instead of 2024.
Neglecting Skill and Experience:
COLA treats all employees within a specific category equally, regardless of their skills, experience, or job performance. It doesn’t reward individual contributions and growth, which can demotivate employees from improving their skills and performance.
Lack of Incentive for Productivity:
When employees don’t see a direct correlation between their efforts and their earnings, there might be less motivation to increase productivity or take on additional responsibilities.
Potential Inflation Impact:
COLA adjustments can contribute to inflationary pressures, especially when costs are passed on to consumers, potentially reducing the purchasing power of the raised allowance.
Limited Negotiation Leverage:
Employers (Government) might prefer COLA over salary increments as they can be easier to implement and predict in terms of budgeting. This can reduce the bargaining power of workers during negotiations.
Perceived Fairness Issues:
Some workers may perceive COLA as unfair if it doesn’t adequately address their individual financial needs, especially if they’re facing higher living costs due to specific circumstances.
