Business Research Assignment: Tacking The Issues Of Wage Theft In Lagos, Nigeria

Question

Task:
The purpose of this business research assignment is for students to demonstrate their capacity to identify a business issue, undertake quality secondary research to uncover both external and internal influences via relevant theory learned in prior units and then provide concise recommendations to address the issue.

The written report should contain the results of work conducted from the proposal including secondary data (e.g. academic literature, business reports, industry journals etc.) which highlight and complement the selected project topic. The report should also include the results of analysis and evaluation of data collected during the project. Importantly the report should contain recommendations and/or solutions to the problem or issues raised in the original proposal.

Answer

1. Introduction

1.1 Background of the study undertaken in this business research assignment

Wage theft is the non-payment of the salaries of the workers for work done. It is prevalent in most of the developed countries and less developed nations. As opined by Ayodele (2019), wage theft is the denial of wage payment and employee benefits that are rightfully owed to the employees. All modes of wage theft are violation of the Nigerian labour law and currently it has become a national tragedy and embarrassment situation in Nigeria. Public and private organisation has joined hands in the league of wage thieves in the country wherein they either pay half salary or no salary. Such inhuman activities have made life miserable for most of the workers and their family. Today, wage theft has become an endemic in Nigeria wherein no group of workers working either in civil organisation as well as private business is immune. It has become a culture for Nigerians to work without being paid the full salary, to retire without gratuity and pension for months and years. 

1.2 Significance of the study 

The significance of the study states that with the increased number of wage theft instances, the national security is compromised leading to compromising the individual development of the country. The national development is very slow in Nigeria as the worker does not have money to meet their basic survival requirement like food, cloth and shelter. An inclusion of NGO shall ensure to look after the welfare of the workers and prevent instances of wage theft situation both in the public and private organisation (Berg and Farbenblum, 2017). Despite extensive labour laws in Nigeria against wage underpayment, it is not yet regarded as the crime to underpay the employee. If an employer is held liable for wage theft, the court shall pronounce an order that the business must pay back to its labourers and issue penalties to the employer. An absence of criminal offence for wage theft has provoked the employers to continue their actions until they are held liable by the court. 

2. Literature Review 

2.1 Meaning of Wage Theft

A wage theft is a situation when the employers do not pay to the workers as per the law. Instances of wage theft consists of paying less than the minimum wage, not paying overtime to workers, not allowing workers to take breaks and have their meals, requiring off the clockwork, taking workers' tips. In most of the situation, wage theft occurs when as a deliberate action that is taken by the employer to steal money that is rightly and lawfully entitled to the employee (Akinwale and Olusanya, 2020). The act of wage theft is prevalent in specific industries like retail, fast food and hospitality sector. According to the National Minimum Wage for Federal Workers in Nigeria is 30000 Nigerian Naira for the year 2021. When an employer pays less than the minimum guaranteed amount, it results in wage theft. 

2.2 Causes of Wage Theft 

Wage theft is a long-standing issue in Nigeria. For years, the federal government of the country, state government as well as the local government, and the companies operating in Nigeria has failed to pay their employees a fully contracted wages. Some employees are given half the salary whereas some of them are paid none (Farbenblum and Berg, 2018). The causes of wage theft are unpaid hours or underpayment of hours of work, unpaid penalty rates, denial of paying superannuation contributions and unreasonable wage deductions. The most incidents of wage theft is caused as a result of systematic internal failures of the business. For example, Nigeria earns maximum revenue from exporting oil to developed and developing nations. However, the country is unable to generate adequate money due to high depreciation of Nigerian currency to USD. The reason for this is that Nigeria is heavily dependent on oil revenues, where prices have fallen and the income from oil exports is not sufficient to cover the shortfall in oil exports. Many employers resort to wage theft intentionally because the switching cost of employees is low and they find it difficulty in finding an alternative occupation. Workers without knowledge-based economic skills are particularly at risk (Rexer and Hvinden, 2020). In short, employers believe that workers are afraid to complain about unpaid wages or to take action.

2.3 Challenges of Wage Theft faced by public and private entities 

Wage theft from the workers affects the society by causing a detrimental impact to the well-being of the workers. It causes widening the gap between the income, causing inequality, wage stagnation and declining the in the living standards of the population. Largely, the immigrants and Latino workers suffer the most from the events of wage thefts. According to the researchers at the National Employment Law Project, 68% of the workers get affected by wage theft, and 26% of the workers had been paid lower than the minimum wage fixed by the country (America, 2021). Wage theft affects not only the people who have been paid at all; it also affects the public and private entities as well. Trade unions play an enormous role in catering to the welfare of the employees in the public sector against the threats of wage theft. Unfortunately, the trade unions in the private entities are forced to compromise on the issues of wage theft as they need to face strict bargaining terms with the management of private companies as well as various governments in the country. As opined by Nwaiwu and Joseph (2021), workers engaged in the manufacturing sector, repairing and private sector faces the highest risk for the violation of minimum wage payment. The events of misclassification of employees take place largely in the private sectors where it is often found that the regulation of Minimum Wages Act is not compiled adequately. 

2.4 Use of websites and social media 

Websites and social media act as a vast communication platform that connects people worldwide. Social media platforms are predominantly used to learn new things and undertake training using new technology. Virtual participation, team building, introducing instructors and training content, engaging students to share knowledge, capturing real-time feedback, connecting directly with learners, creating resources, maintaining momentum after publication, and receiving feedback links are steps in introducing the training session that must be conveyed is its content (Osabohien et al., 2021). Social media apps can be Facebook, YouTube, Instagram, QQ, Sino Weibo, and more are predominantly used as a medium to voice out concern and raise issues against the social injustice. The employees in Nigeria can resort to The Federal Ministry of Labour and Employment to register their compliant against wage theft. 

2.5 Theory Used- Technology Acceptance Model

The technology acceptance model (TAM) is an information system theory that instructs how the users can accept and use a technology (Ajide, 2021). The model has two main components- Perceived Usefulness (PU) and Perceived Ease of Use (PEOU) that influences the decision of the users. The use of TAM is dealing with wage theft shall help in the identification of the external variables or factors governing the situation. Common factors like employee motivation, job satisfaction and staff loyalty for perceived usefulness and perceived ease of use shall be used by the NGOs to train its volunteers to address the welfare of the affected Nigerian employees. 

Figure 1: Technology Acceptance Model

(Source: Efanodor-Obeten Omokiniovo, 2020)

The TAM shall ensure the adequate use of social media platforms and government websites wherein affected employees can loge compliant and voice out their grievances against the concerned employer regarding wage theft (Miner et al., 2020). The Technology Acceptance Model is designed to measure the adoption of the new technology for detecting the instance of wage theft occurring both in private and public organisation based on the customer attitudes. The decisions on the part of employer and employee to adhere to the regulations of the National Minimum Wage Act have been determined using the TAM. The NGOs shall collect data from the portals and websites and take up necessary actions against such employers undertaking wage theft. 

2.6 Summary 

In this section, the researcher has highlighted the meaning of wage theft, its causes and the challenges faced by both public and private sector in dealing with issues of wage theft. The chapter provides a detailed knowledge about the previous studies and opinions yielded about the wage theft and models of TAM to accept a new technology to prohibit wage theft in businesses. However, this literature review has recognised the breaches conducted in the previous literary works on the given topic that paved the way for the researchers to carry out the study forwards using primary and secondary research methodology mentioned in the next section. 

3. Research Methodology

3.1 Primary Research

3.1.1 Quality of Life analysis (QOL)

A questionnaire consisting of 10 questions based on the identification of well-being of a person and relationship with the colleagues is prepared. A total of 10 respondents shall participate in the survey to share their views about their current well-being both in terms of personal and professional life.

3.2 Secondary Research

3.2.1 PEST analysis

3.2.2 SWOT analysis

3.2.3 Root Cause analysis

3.2.4 Resource-Based View Theory and VRIO framework

RBV is considered to be a model which identifies major resources as a key in firm performance. It would be effective to approach the advantage of competition with the help of VRIO attributes. However, NGOs plays an important role in identifying some of the resource-based for both intangible and tangible resources for running the online business (Ejiogu, Ejiogu, and Ambituuni, 2019). Moreover, the framework of VRIO could be identified in the following manner:

Hence, with the help of the VRIO framework, it can be said that NGOs need to focus on services for making it in an organised way. Moreover, it also needs to ensure in bringing learning opportunities for motivating the employees (Amusan, and Saka, 2018). However, the proposal of the business is highly dependent on the actions and roles of the NGO for being competitive and sustained in maintaining wages for employees. 

4.0 Analysis and Discussion 

4.1 Business Project Goals

4.1.1 Financial Goals

The inclusion of NGO known as “My Pay My Right” is aimed to eliminate the problem of wage theft incidents in Nigeria. The NGO aims to set a target of achieving an overall 10% growth in the next 6 months. From the survey conducted, it is found out that most of the workers working in the Nigerian organisations have low morale and motivation towards their work. The primary reason stated by the respondents is undue payment or no payment for work done. Therefore, "My Pay My Right" aims to motivate the employees and the employers to increase the revenue generation capacity of the organisations in Lagos (Johnston, 2019). Oil export business is one of the most profitable businesses in the world. The NGO shall enable the employer to derive maximum return for exporting oil to other countries. 

4.1.2 Non-financial Goals

The non-financial goals of "My Pay My Right" is analysed to reduce the incidents of wage theft in the business environment of Nigeria by 10%. Few organisations have adopted the new business goals for the welfare of its employees to avail wages at the end of the period as their employment right (Akwu et al., 2021). It has been found that in such businesses, the incidents of undue wage deduction, non-payment of wages at the end of the year is substantially reduced. Moreover, the employees of such organisations in Lagos are motivated and have identified the prominence of employee awareness and recognition of the Minimum Wages Act in the country. 

4.2 Marketing Communication Plan

“My Pay My Right” has undertaken its marketing and awareness communication plan to enrich the knowledge among the workers about their rights towards receiving the wages and salary upon the roles and responsibility discharged (Abraham, 2020). The NGO has undertaken online campaigns, offline campaigns and inclusion of NGO in the CSR programmes of the organisation. 

4.3 Strategic evaluation

The strategic implementation of NGO in Lagos is to impart education and knowledge about the labour laws prevailing in the country (Ugoani, 2020). With education, the employees themselves can fight for their own rights to receive payment as agreed in the employment contract. The NGOs shall provide external support to the trade union by means of online and offline campaigns to make people aware about the negative consequences of wage theft in Lagos. 

5. Conclusion and Recommendation 

5.1 Conclusion

Currently, wage theft has become an endemic in Nigeria. All forms of organisations- government, private and public are prone to wage theft. Wage theft is yet to be considered as a crime in the country, and when an employer fails to make sufficient payment to the employee based on the applicable minimum wage, and then such employer only faces the threat of financial penalty upto the unpaid amount. In the past decade, the under-developed countries and migrant workers have faced 50% of the total cases of wage theft. 

5.2 Contingencies and Future implications to NGO

Both the NGO and the HR department of a company can prevent wage theft occurring in the business environment. As the rigidity of wage theft offense is not severe in Nigeria and is limited to financial penalty only, therefore, reoccurrence of such incident is very common. NGOs play a vital role in eliminating the risk of wage and hour non-compliances. They help the employee body to collectively form a trade union to address grievance on behalf of the employees to the employer. The NGOs preaches tactics to undertake collective bargaining skills in closing the bid in favour of the employees. However the contingencies lie in the effectiveness of threshold of success rate of NGO to continue their awareness program towards eliminating wage theft. Over the period, the NGOs take a backfoot by failing to achieve their objective of motivating their employees. 

5.3 Recommendation

Based upon the findings outlined above, the following are the recommendations that can be drawn-

• The introduction of a national justice mechanism or Claims Commission within the existing national wage framework in Nigeria and supported by the International Labour Organisation and the International Organisation for Migration, in specific. This mechanism shall be dedicated to the expedited processing of the wage theft claims and make required arrangement for compensating the migrant workers. 
• The establishment of wage theft justice fund or Compensation fund. This fund shall act in pursuing the welfare of the migrant workers and workers who have suffered wage theft incident. Upon proven, the worker shall receive financial compensation from the fund based on the amount decided by the labour court. 

Reference List

Akinwale, A.A. and Olusanya, O.A., 2020. Influence of Subcontracting Processes on Wages and Workloads in the Building Construction Industry in Nigeria. Journal of Construction Business and Management, 4(2), pp.1-10.

America, R.F., 2021. Restitution to Africa: Unjust Enrichment and Damages from Imperial, Colonial, and Post Colonial Abuse of Dominance. Challenge, pp.1-7.

Amusan, L. and Saka, L., 2018. The Nigerian police force and the task of policing democratic Nigeria: Issues and problems. Anthropologist, 31(1-3), pp.105-116.

Ayodele, J.O., 2019. Crimes and Internal Security in Nigeria. In Internal Security Management in Nigeria (pp. 215-231). Palgrave Macmillan, Singapore.

Berg, L. and Farbenblum, B., 2017. Wage theft in Australia: Findings of the national temporary migrant work survey. Available at SSRN 3140071.

Ejiogu, A., Ejiogu, C. and Ambituuni, A., 2019. The dark side of transparency: Does the Nigeria extractive industries transparency initiative help or hinder accountability and corruption control?. The British Accounting Review, 51(5), p.100811.

Etor, C.R., Etudor-Eyo, E. and Ukpabio, G.E., 2020. Provision of Security Facilities and Security Personnel Service Delivery in Universities in Cross River State, Nigeria. International Education Studies, 13(5), pp.125-131. 

Farbenblum, B. and Berg, L., 2018. Wage Theft in Silence: Why migrant workers do not recover their unpaid wages in Australia. UNSW Law Research Paper, (19-1).

Joseph, O.O., Odemero, A.F., Folunsho, O.G. and Oghenefejiro, J.J.U., 2020. Appraisal of backyard farming among households: implications for rural development and food security in Nigeria. Asian Journal of Agriculture and Rural Development, 10(1), pp.160-170.

Kambule, N. and Nwulu, N., 2021. Rationale Part II: A Misdiagnosis of Non-payment and Electricity Theft. In The Deployment of Prepaid Electricity Meters in Sub-Saharan Africa (pp. 33-53). Springer, Cham.

Lisk, F., 2017. Labour and employment creation with African resource development. Business research assignment Journal of Sustainable Development Law and Policy (The), 8(1), pp.288-308.

Miner, K.J., Rampedi, I.T., Ifegbesan, A.P. and Machete, F., 2020. Survey on household awareness and willingness to participate in e-waste management in Jos, Plateau State, Nigeria. Sustainability, 12(3), p.1047.

Nwaiwu, J.N. and Joseph, B., 2021. Accounting system and payroll fraud of local governments in Nigeria. Middle European Scientific Bulletin, 12, pp.224-238.

Olusanya, O.A. and Adewumi, O.A., 2018. Subcontracting Systems and Working Conditions in the Building Construction Industry in Lagos, Nigeria. Unilag Journal of Humanities, 6(2), pp.177-193.

Osabohien, R.R., Olurinola, I.O., Matthew, O.A. and Edafe, O.D., 2021, March. Youth Farmers, Shocks and Food Security in Nigeria. In IOP Conference Series: Earth and Environmental Science (Vol. 665, No. 1, p. 012037). IOP Publishing.

Rexer, J. and Hvinden, E., 2020. Delta boys: Bargaining, war, and black market oil in Nigeria. Working Paper.

Salloum, S.A., Alhamad, A.Q.M., Al-Emran, M., Monem, A.A. and Shaalan, K., 2019.Exploring students’ acceptance of e-learning through the development of a comprehensive technology acceptance model. IEEE Access, 7, pp.128445-128462.

Smith, R.J. and Santiago, A.M., 2018. Community Practice Across Borders.

Tagliarino, N.K., Bununu, Y.A., Micheal, M.O., De Maria, M. and Olusanmi, A., 2018. Compensation for expropriated community farmland in Nigeria: An in-Depth analysis of the laws and practices related to land expropriation for the lekki free trade zone in Lagos. Land, 7(1), p.23.

Appendix: Questionnaire on Quality of Life

1. Demographic Question: What is your gender?

• Male
• Female

2. What is your highest educational qualification?

• No school class="assignmentfont"ing completed
• Some high school class="assignmentfont" or diploma
• High school class="assignmentfont" graduate
• Professional/Vocational/Technical Training
• Bachelor’s degree
• Master’s degree
• Doctorate degree

3. I am happy with the house I live in

4. I am satisfied with the hygiene around my home

5. I need good food to eat

6. I need to be mentally healthy

7. What is your regular activity?

8. I am happy about achieving something good in the past 4 weeks

9. I am bored very easily

10. I am satisfied with my professional life