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Tension mounts over PHCN contract workers six months after

By BusinessNews Staff on April 29, 2014

Less than 48 hours to the expiration of the six months’ duration for the termination of the appointments of the staff of the defunct Power Holding Company of Nigeria (PHCN) who were employed on a contract basis by the new investors in the power sector, a fresh crisis is looming between the investors and labour unions in the power sector, THISDAY has gathered.

The new owners, who took over the PHCN assets on November 1, 2013 disengaged some workers and gave others contract employment that will terminate after six months from the handover date.

At the expiration of the six months, the new investors are expected to right- size and inject new blood into the sector, so as to end the inefficiency that had characterised the sector under government’s watch.
THISDAY however gathered that about two days to the April 30, 2014 cut-off date stipulated under the privatisation guidelines for the new investors to appraise the performance of their old workforce and disengage non- productive staff, the labour unions are spoiling for a showdown with the investors.

The labour unions, which allegedly collected over N8 billion, apparently as arrears of check-off dues, as a condition for allowing the first disengagement carried out last year, have vowed to resist any attempt to disengage the contract workers.

The disengaged workers, it was learnt, were also paid over N360 billion entitlements last year, with management staff collecting over N100 million each, while each of the junior workers went home with N5 million.

Those disengaged can still get jobs in other establishments, where they can earn another pension.
One of the new investors told THISDAY that the April 30 deadline for the termination of the appointments of the contract staff would be an opportunity for the new investors to do proper appraisal of their human capital to get the right people for effective service delivery.
“It will be a plus to the power sector because the new owners will do an honest appraisal of their human capital. I don’t believe that any company will just terminate people’s appointments just because the six months have expired. A number of the companies have employed the services of KPMG and PwC to do audit of their human capital and what they actually need. It will provide an opportunity for the review of remunerations and anybody retained will have a brighter future and electricity consumers will also enjoy the benefits of having the right people to reach them,” he said.

According to him, if the private investors are prevented from disengaging workers, who are no longer productive, there would be no employment of young and energetic workforce, thereby worsening the power situation.

But one of the top officials of the unions, who spoke to THISDAY on the condition of anonymity at the weekend, said labour would resist the plan to sack the workers.

“It is normal that the labour will resist it and there is a plan to resist it. There ought to have been a resistance last week but the unions went back to re-strategise. It will be resisted at the Nigeria Labour Congress (NLC) level,” said an official.

He stated that one of the major grievances of the workers was that some of them were being owed their entitlements by the federal government and the new investors.

Meanwhile, the federal government has again asked potential investors in Nigeria’s emerging electricity market to take advantage of several investment incentives it has initiated to take concrete decisions on investing in Nigeria’s power sector.

The government stated that such incentives, which include a $300 million Partial Risk Guarantee (PRG) which is domiciled with the Central Bank of Nigeria (CBN) and the World Bank, tax holidays and waivers on certain operational equipment have been initiated to act as a major push to protect investors, strengthen their confidence and guarantee return on investment in the country’s power sector.

The Minister of State for Power, Mohammed Wakil, said at a recent Power Africa event organised by the United States Department of Commerce in Miami, Florida that apart from these operational incentives, reforms in Nigeria’s power sector offers huge opportunities for investors to take part in the sector that is touted to soon emerge as one of the largest in Sub-Sahara Africa.

A statement by his Special Assistant, Media, Mr. Olawale Rasheed, yesterday in Abuja quoted Wakil as saying this in a keynote address he delivered at the event where he reminded investors that the $300 million PRG was still available.
According to the minister, there are tax holidays and waivers for importation of power equipment needed for generation, transmission and distribution in the sector.

[This Day]

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