Minimum Wage-Fixing Machinery Convention, 1928 (No. 26) - Madagascar (Ratification: 1960)

Observation (CEACR) - adopted 2022, published 111st ILC session (2023)

In order to provide an overview of matters relating to the application of the ratified Conventions on wages, the Committee considers it appropriate to examine the application of Conventions Nos 26 (minimum wages) and 95 (protection of wages) in a single comment.

The Committee notes the observations of the Trade Union Confederation of Malagasy Revolutionary Workers (FISEMARE) and the General Confederation of Workers’ Unions of Madagascar (FISEMA), received on 1 September 2022.

Minimum wages

Article 3 of Convention No. 26. Minimum wage-fixing machinery and consultation of the social partners. Further to its previous comments, the Committee notes the information provided by the Government in its report on the adoption of Decree No. 2022-626 of 4 May 2022 setting the minimum starting wage in the private sector, for which the implementing order is still being prepared. The Government adds that the new minimum starting wage was set taking into account the protocol containing the outcome of wage bargaining, submitted to the National Labour Council (CNT) for its views on 5 April 2022, and that it includes a supplement covered by the State. In this regard, the Committee notes the observations of the FISEMA and the FISEMARE, which indicate that: (i) the minimum wage-fixing machinery no longer takes into account the real situation and the minimum subsistence level for workers; and (ii) there is a significant period of time between the declaration of the new minimum starting wage and the publication of the corresponding order, which accentuates the difficulties faced by workers in meeting their living expenses, particularly in light of price rises. The Committee also notes the Government’s indication that, within the context of the operationalization of the CNT, standing committees have been established to ensure the sound functioning of the CNT, including the purchasing power and wages committee. In this connection, it notes the observations of the FISEMA concerning the dysfunctionality of the CNT and that the purchasing power and wages committee has been created but is not yet operational. It also notes the emphasis by the FISEMARE that, despite the existence of regular dialogue between employers and workers on wage increases, in the last resort, the rates of minimum wages are set by employers. The Committee requests the Government to intensify its efforts to make the CNT operational, and to provide information on this subject, including on the establishment of the purchasing power and wages committee, its work and achievements. The Committee also requests the Government to take the necessary measures to adopt, as soon as possible, the implementing order of Decree No. 2022-626 of 4 May 2022, and to provide information on the progress made in this regard.

Article 4. System of supervision and sanctions. Further to its previous comments, the Committee notes the Government’s indication that, since 2019, the labour inspection services, together with the National Social Insurance Fund, have established a task force responsible for monitoring regularly the application of the Decree on the minimum starting wage, and that: (i) in the event of failure to apply the minimum starting wage, the labour administration makes time-bound recommendations with a view to ensuring effective compliance with the Decree on the minimum starting wage; and (ii) if these recommendations are not given effect, labour inspectors indicate the offences in a report referred to the Office of the Prosecutor-General of the Republic. The Committee requests the Government to continue providing information on the activities of the task force, including statistics on cases of failure to apply the minimum starting wage, and the measures adopted to resolve the issue.

Protection of wages

Article 8 of Convention No. 95. Deductions from wages. The Committee notes that, in reply to its previous comment, the Government indicates in its report that: (i) no deduction from wages may be made without the consent of the worker; and (ii) labour inspectors organize information sessions and training for public institutions and the social partners with a view to preventing risks of abuse in this field. However, the Committee notes that the Government does not indicate the manner in which the deductions authorized in sections 69 and 71 of the Labour Code are limited. The Committee recalls that, in accordance with Article 8(1) of the Convention, deductions from wages shall be permitted only under conditions and to the extent prescribed by national laws or regulations, or fixed by collective agreement or arbitration award. The Committee therefore requests the Government to indicate the measures adopted or envisaged that are necessary to establish precise and overall limits on the deductions from wages authorized in sections 69 and 71 of the Labour Code. It requests the Government to provide information on this subject.

Article 12. Regular payment of wages and final settlement of all wages upon the termination of the contract. Further to its previous comment, the Committee notes that the Government has not provided information on delays in the payment of wages and of social security contributions, as well as cases of the non-payment of the remaining amounts due to workers on the termination of the employment relationship. It also notes that the FISEMA denounces the existence of several months of wage arrears, including social security contributions, in the public sector and considers that the labour inspection services have no authority in relation to this situation. The Committee once again requests the Government to take all the necessary measures, including action by the labour inspection services and the imposition of effective penalties in the event of non-compliance, to resolve these difficulties and to provide information on this subject.

Direct Request (CEACR) - adopted 2021, published 110th ILC session (2022)

The Committee notes that the Government’s report has not been received. It hopes that the next report will contain full information on the matters raised in its previous comments.

Repetition

In order to provide an overview of matters relating to the application of the ratified Conventions on wages, the Committee considers it appropriate to examine Conventions Nos 26 (minimum wages) and 95 (protection of wages) in a single comment. The Committee notes the observations of Madagascar Enterprise Group (GEM) and of the Christian Confederation of Malagasy Trade Unions (SEKRIMA) provided with the Government’s reports.

Minimum wages

Article 3 of Convention No. 26. Minimum wage fixing machinery and consultation of the social partners. Further to its previous comments, the Committee notes the information provided by the Government, particularly the adoption in 2017 of Decree No. 2017-143 setting the new rates of the starting and seniority minimum wage, and of Decree No. 2017-843 establishing the National Labour Council (CNT) and the Regional Tripartite Labour Councils. The Government indicates that the CNT is being operationalized. The Committee notes that, in accordance with the relevant provisions of the Labour Code, Decree No. 2017-143 reaffirms the role of the CNT in the functioning of the minimum wage system and establishes the Committee on Purchasing Power and Wages as a standing committee of the CNT. The Committee also notes the indications of the GEM that the minimum wage rates have been reviewed on the basis of annual negotiations between the social partners. It also notes that the SEKRIMA considers that the method used to calculate minimum wages does not take into account the real social context and must be reviewed. The Committee requests the Government to provide information on the progress achieved to operationalize the National Labour Council, and on its work on minimum wages and any results achieved.

Article 4. System of supervision and sanctions. Further to its previous comments, the Committee notes the information provided by the Government on reported infringements concerning non-payment of the minimum wage. The Committee also notes the reports of the SEKRIMA that there is insufficient supervision by the labour administration. The Committee also notes that, according to the Decent Work Country Programme (2015–19), 80 per cent of workers are engaged in the informal economy. In this context, the Committee requests the Government to take the necessary measures to ensure the payment of the minimum wage in the formal and informal sectors, including through the action of the labour inspection services and the imposition of effective sanctions in the event of non-compliance. It requests the Government to provide information in this regard.

Protection of wages

Article 8 of Convention No. 95. Deductions from wages. Further to its previous comments, the Committee notes the information provided by the Government on deductions from wages. It notes the reports by the SEKRIMA of abuse in this area. The Committee notes that, in addition to statutory deductions, sections 69 and 71 of the Labour Code authorize deductions in the event of the employer making special advances and advance payments and in order to reimburse amounts related to the use of equipment. These deductions can be made in addition to those related to voluntary attachment or assignment of wages. While the latter are limited by section 685 of the Code of Civil Procedure, there is no limit on the other deductions. The Committee requests the Government to indicate the manner in which the deductions authorized by sections 69 and 71 of the Labour Code are limited and to take steps to prevent abuse.

Article 12. Regular payment of wages and final settlement of all wages upon the termination of the contract. Further to its previous comments, the Committee notes the information provided by the Government. It also notes that the SEKRIMA reports delays in the payment of wages and of social security contributions as well as cases of non-payment of remaining amounts due to workers on the termination of the employment relationship. The Committee requests the Government to take steps, including through the labour inspection service and the imposition of effective sanctions in the event of non-compliance, in order to remedy these difficulties and to provide information in this respect.

Direct Request (CEACR) - adopted 2019, published 109th ILC session (2021)

In order to provide an overview of matters relating to the application of the ratified Conventions on wages, the Committee considers it appropriate to examine Conventions Nos 26 (minimum wages) and 95 (protection of wages) in a single comment. The Committee notes the observations of Madagascar Enterprise Group (GEM) and of the Christian Confederation of Malagasy Trade Unions (SEKRIMA) provided with the Government’s reports.

Minimum wages

Article 3 of Convention No. 26. Minimum wage fixing machinery and consultation of the social partners. Further to its previous comments, the Committee notes the information provided by the Government, particularly the adoption in 2017 of Decree No. 2017-143 setting the new rates of the starting and seniority minimum wage, and of Decree No. 2017-843 establishing the National Labour Council (CNT) and the Regional Tripartite Labour Councils. The Government indicates that the CNT is being operationalized. The Committee notes that, in accordance with the relevant provisions of the Labour Code, Decree No. 2017-143 reaffirms the role of the CNT in the functioning of the minimum wage system and establishes the Committee on Purchasing Power and Wages as a standing committee of the CNT. The Committee also notes the indications of the GEM that the minimum wage rates have been reviewed on the basis of annual negotiations between the social partners. It also notes that the SEKRIMA considers that the method used to calculate minimum wages does not take into account the real social context and must be reviewed. The Committee requests the Government to provide information on the progress achieved to operationalize the National Labour Council, and on its work on minimum wages and any results achieved.

Article 4. System of supervision and sanctions. Further to its previous comments, the Committee notes the information provided by the Government on reported infringements concerning non-payment of the minimum wage. The Committee also notes the reports of the SEKRIMA that there is insufficient supervision by the labour administration. The Committee also notes that, according to the Decent Work Country Programme (2015–19), 80 per cent of workers are engaged in the informal economy. In this context, the Committee requests the Government to take the necessary measures to ensure the payment of the minimum wage in the formal and informal sectors, including through the action of the labour inspection services and the imposition of effective sanctions in the event of non-compliance. It requests the Government to provide information in this regard.

Protection of wages

Article 8 of Convention No. 95. Deductions from wages. Further to its previous comments, the Committee notes the information provided by the Government on deductions from wages. It notes the reports by the SEKRIMA of abuse in this area. The Committee notes that, in addition to statutory deductions, sections 69 and 71 of the Labour Code authorize deductions in the event of the employer making special advances and advance payments and in order to reimburse amounts related to the use of equipment. These deductions can be made in addition to those related to voluntary attachment or assignment of wages. While the latter are limited by section 685 of the Code of Civil Procedure, there is no limit on the other deductions. The Committee requests the Government to indicate the manner in which the deductions authorized by sections 69 and 71 of the Labour Code are limited and to take steps to prevent abuse.

Article 12. Regular payment of wages and final settlement of all wages upon the termination of the contract. Further to its previous comments, the Committee notes the information provided by the Government. It also notes that the SEKRIMA reports delays in the payment of wages and of social security contributions as well as cases of non-payment of remaining amounts due to workers on the termination of the employment relationship. The Committee requests the Government to take steps, including through the labour inspection service and the imposition of effective sanctions in the event of non-compliance, in order to remedy these difficulties and to provide information in this respect.

Direct Request (CEACR) - adopted 2012, published 102nd ILC session (2013)

Articles 1 and 3 of the Convention. Minimum wage fixing machinery and minimum wage rates. The Committee notes the adoption of Decree No. 2012-390 of 20 March 2012 fixing the value of the index point for the calculation of the minimum starting and seniority wage (SME) by occupational category and setting the minimum wage rate at 101.440 Malagasy ariary (MGA) (approximately US$46) per month for the agricultural sector and MGA100.011 (approximately $45) per month for the non-agricultural sector. However, the Committee notes that according to the 2010 Periodical Household Survey of the National Institute of Statistics of Madagascar (INSTAT), published in August 2011, more than 42 per cent of the active population receive wages lower than the statutory minimum wage. The same report indicates that 56.5 per cent of the population live in conditions of extreme poverty characterized by a consumption level inferior to the basic food basket that represents 2,133 Kcal per day, and also that 82 per cent of the households have an income that does not cover their basic needs. Recalling that under section 55 of the Labour Code, the minimum wage is determined taking into consideration the minimum subsistence needs of workers and ensuring them adequate purchasing power, the Committee requests the Government to indicate whether the current minimum wage level guarantees a decent standard of living for workers and their families.

In addition, the Committee notes the Government’s explanations on the functioning of the National Labour Council (CNT) and its permanent committees, including a wages committee. It notes, however, that the lack of rules of procedure and the current crisis context have prevented the operation of the various permanent committees. In this connection, the Committee also notes the comments made by the General Confederation of Workers’ Unions of Madagascar (CGSTM) on the participation of workers’ and employers’ representatives in the minimum wage-fixing process. The Committee requests the Government to keep the Office informed of any progress concerning the adoption of rules of procedure of the CNT and the establishment of the permanent wages committee.

Article 5 and Part V of the report form. Enforcement measures – Application in practice. The Committee notes the evolution of minimum wage rates in the period 2010–12. It also notes the statistical data provided by the Government according to which 25 per cent of inspected enterprises in 2011 were found to pay sub-minimum wages. The Committee requests the Government to continue to provide up-to-date information on the practical application of the Convention, including also with regard to enforcement of its provisions.

Direct Request (CEACR) - adopted 2008, published 98th ILC session (2009)

Articles 1 and 3 of the Convention. Minimum wage-fixing machinery and minimum wage rates. Further to its previous comment, the Committee notes the adoption of Decree No. 2007-246 of 17 March 2007 fixing the value of the index point for the calculation of the minimum starting and seniority wage (SME) by occupational category, which provides for a rate of increase of 12 per cent and thus fixes the minimum starting wage at AR63,542.80 (about US$39) per month for the non-agricultural sector and AR64,440 (about US$39.50) per month for the agricultural sector. While noting that under section 55 of the Labour Code the living wage for workers ensuring them sufficient purchasing power must be taken into consideration in determining minimum wage levels, the Committee requests the Government to indicate whether the amount of the minimum starting wage currently in force is likely to ensure an adequate living standard for the workers concerned. The Committee also notes Decree No. 2005-239 of 31 May 2005 establishing the National Labour Council (CNT) and in particular sections 4 and 6 thereof, which guarantee equal representation of employers’ and workers’ organizations within bodies such as the General Assembly and the Presidency. The Committee requests the Government to supply further information in future reports on the functioning of the CNT in wage policy matters, including, for example, annual activity reports or copies of surveys of the economic situation serving as a basis for consultations aimed at the periodic adjustment of the minimum starting wage.

Article 5 and Part V of the report form. The Committee notes with interest the statistics supplied by the Government concerning the number of workers who receive the minimum starting wage in 19 export processing enterprises. The Committee would be grateful if the Government would continue to supply statistical data on the number of workers paid the minimum wage (if possible, disaggregated according to sex and age), further details of wage trends in relation to changes in economic indicators and also of the number of inspections carried out, including in the industrial export processing zones, and on the number of reported contraventions of the legislation relating to minimum wages.

Finally, the Committee takes this opportunity to draw the Government’s attention to the conclusions adopted by the ILO Governing Body on the basis of the recommendations of the Working Party on Policy regarding the Revision of Standards (GB.283/LILS/WP/PRS/1/2, paragraphs 19 and 40). The Governing Body considered that Convention No. 26 was one of the instruments which were no longer up to date, even though they were still relevant in certain regards. The Committee therefore suggests that the Government examine the possibility of ratifying the Minimum Wage Fixing Convention, 1970 (No. 131), which represents a degree of progress in comparison with previous instruments concerning the fixing of a minimum wage, for example by providing for a wider scope, the setting-up of a general minimum wage system and, finally, the adoption of certain criteria for determining minimum wage levels. The Committee requests the Government to keep the Office informed of any decision taken or contemplated in this regard.

Direct Request (CEACR) - adopted 2006, published 96th ILC session (2007)

The Committee notes with interest the adoption of Act No. 2003-044 of 28 July 2004 issuing the Labour Code. It would be grateful to be provided with additional information on the following points.

Articles 1 and 3 of the Convention. Minimum wages. The Committee notes that section 55 of the new Labour Code provides for the establishment of an agricultural and non-agricultural minimum starting wage (SME) taking into consideration the vital minimum for workers to ensure sufficient purchasing power. It also notes that, under the terms of this provision, a decree issued following an opinion of the National Labour Council shall determine the minimum starting wage by occupational category and that another decree, also issued following the opinion of the National Labour Council, shall determine the indices, the value of the index point and the minimum starting and seniority wage by occupational category in the agricultural and non-agricultural sectors. The Committee notes that Decree No. 2004-1133 of 21 December 2004 determined the value of the index point for the calculation of minimum starting and seniority wages by occupational category, with an increase of 10.02 per cent in relation to the index point determined in May 2004. It requests the Government to indicate whether the other decrees referred to in section 55 of the Labour Code have been adopted and, if so, to provide copies. It further requests the Government to provide a copy of Decree No. 2005-329 establishing the National Labour Council (CNT), which was not attached to its report. The Government is also requested to provide fuller information on the means through which the employers and workers concerned participate in the operation of minimum wage fixing machinery, in equal numbers and on equal terms, as required by the Convention.

Article 5 and Part V of the report form. The Committee requests the Government to provide a general appreciation of the manner in which the Convention is applied in practice, including statistical data on the number of workers (men and women, as well as adults and young persons) covered by the provisions of the Labour Code respecting minimum wages, trends in the rates of minimum wages in relation to those of economic indicators such as inflation, as well as the number of inspections carried out and violations reported of the legislation respecting minimum wages. The Government is also requested to provide information on the application of the Convention in the industrial export processing zone of Madagascar.

Direct Request (CEACR) - adopted 2003, published 92nd ILC session (2004)

The Committee notes the information contained in the Government’s report. It notes, in particular, the adoption of Decree No. 2003-454 of 8 April 2003 adjusting minimum wage rates for the agricultural and non-agricultural sectors. It also notes that the inter-occupational guaranteed minimum wage (SMIG) is currently set at FMG 197,075 (US$32.4) per month, which represents a nearly 10 per cent increase compared to its 2001 level.

Article 3, paragraph 2(2), of the Convention. The Committee notes that section 67 of the Labour Code provides for permanent consultative wage committees to be responsible for the examination of the criteria which should be taken into account in determining the level of minimum wages, such as the basic needs of workers and the general economic conditions. The Committee would be grateful if the Government could specify in its next report whether such wage committees are effectively in operation and, if so, to communicate the text of the decree defining their membership and terms of reference. The Committee would also wish to receive a copy of the statutory instrument regulating the organization and operation of the National Employment Council (CNE) pursuant to section 155 of the Labour Code, particularly as regards the participation of employers’ and workers’ representatives in equal numbers and on equal terms.

Article 5 in conjunction with Part V of the report form. The Committee notes the statistical information concerning the evolution of minimum wage rates during the period 1998-2003. The Committee would appreciate if the Government would continue to provide general information on the practical application of the Convention, including extracts from official reports and surveys relating to minimum wage issues, available data on the number of workers covered by relevant legislation, the inspection visits and the results obtained, as well as any other particulars bearing on the operation of the minimum wage fixing machinery.

Direct Request (CEACR) - adopted 2002, published 91st ILC session (2003)

The Committee notes that the Government’s report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the matters raised in its previous direct request, which read as follows:

The Committee notes with interest the information provided by the Government in its report on the adoption of Act No. 94-029 of 25 August 1995 issuing the new Labour Code. The Committee notes that by virtue of section 66, the minimum wage (SMIG) must assure the minimum subsistence level for the most underprivileged workers and a satisfactory purchasing power. It also notes that under section 67, the SMIG must be indexed to periodically revised consumer prices, taking into account the state of the nation’s finances and the economic situation. The SMIG is fixed by decree after an opinion has been issued by the National Employment Council (section 67), which is of tripartite composition (section 155).

The Committee notes the Government’s indication that the latest rate of the minimum wage (for the years 1997-98) has been increased by 15 per cent over its previous rate. It notes that Decree No. 98-310 of 9 April 1998 fixing the value of the index point for the calculation of minimum wages for recruitment and levels of seniority by occupational category is not attached to the report. The Committee hopes that the Government will provide this text with its next report.

The Committee also notes the information provided by the Government to the effect that the workers’ trade unions called a strike in 1999 to claim a minimum monthly wage of FMG450,000 (US$90) to cover the decline in their purchasing power. The Committee also notes that comments made by the Madagascar Enterprise Group (GEM) on the latest increase in the minimum wage were not attached to the Government’s report and it hopes that the Government will provide them with its next report and will supply information on changes in the minimum wage and on the measures adopted to respond to the workers’ claims.

Direct Request (CEACR) - adopted 1999, published 88th ILC session (2000)

The Committee notes with interest the information provided by the Government in its report on the adoption of Act No. 94-029 of 25 August 1995 issuing the new Labour Code. The Committee notes that by virtue of section 66, the minimum wage (SMIG) must assure the minimum subsistence level for the most underprivileged workers and a satisfactory purchasing power. It also notes that under section 67, the SMIG must be indexed to periodically revised consumer prices, taking into account the state of the nation's finances and the economic situation. The SMIG is fixed by decree after an opinion has been issued by the National Employment Council (section 67), which is of tripartite composition (section 155).

The Committee notes the Government's indication that the latest rate of the minimum wage (for the years 1997-98) has been increased by 15 per cent over its previous rate. It notes that Decree No. 98-310 of 9 April 1998 fixing the value of the index point for the calculation of minimum wages for recruitment and levels of seniority by occupational category is not attached to the report. The Committee hopes that the Government will provide this text with its next report.

The Committee also notes the information provided by the Government to the effect that the workers' trade unions called a strike in 1999 to claim a minimum monthly wage of FMG450,000 (US$90) to cover the decline in their purchasing power. The Committee also notes that comments made by the Madagascar Enterprise Group (GEM) on the latest increase in the minimum wage were not attached to the Government's report and it hopes that the Government will provide them with its next report and will supply information on changes in the minimum wage and on the measures adopted to respond to the workers' claims.

Direct Request (CEACR) - adopted 1990, published 77th ILC session (1990)

Referring to its earlier comments, the Committee has taken note of the information supplied by the Government and has noted in particular the adoption of Decree No. 89-006 of 11 January 1989 which fixes minimum starting and seniority wages by occupational category. The Committee would be grateful if the Government would communicate the text of this Decree.

The Committee has also noted the new minimum wage rate as well as the number of workers subject to the regulation concerning the fixing of minimum wages. It hopes that, despite the difficulties mentioned in the report, the Government will continue to be able to communicate such information as laid down in Article 5 of the Convention, as well as general indications on the manner in which the Convention is applied in practice (giving, for example, the number of violations reported, the sanctions imposed, etc.) as requested in the report form under point V.