Ethiopia’s Minimum Wage Framework Faces Delays Despite Draft Completion

Mintesinot Niggusie

Ethiopia has yet to operationalise its minimum wage framework, even as a draft regulation enabling its rollout has been finalised and submitted for government approval.

The Confederation of Ethiopian Trade Unions said the draft, which sets out the legal basis for establishing a national minimum wage board, is now awaiting a decision from the Council of Ministers. The absence of an approved regulation has prevented the board from starting work.

Kassahun Follo, president of the confederation, said the delay stems from the lack of an endorsed procedural framework. Without it, the institution tasked with setting the country’s wage floor cannot be formally constituted.

The draft has progressed from the Ministry of Labour and Skills to the Office of the Prime Minister, where it is under review before being tabled for a final cabinet decision. Approval would pave the way for the board’s formal establishment.

Once in place, the board is expected to assess economic conditions and labour market data to determine a national minimum wage level. Factors under consideration include inflation trends, cost of living and overall economic performance.

Daniel Teressa, state minister at the Ministry of Labour and Skills, said the government is working to secure approval of the regulation in the near term and move the process forward. He added that additional legal instruments are being prepared to support implementation. However, he cautioned that setting a minimum wage alone would not address wider structural challenges in the labour market.

Provisions for introducing a minimum wage were first included in Ethiopia’s Labour Proclamation No. 1156/2019. Implementation has yet to follow, leaving the country without a formal national wage floor.