In the last days of the past year, after negotiations between mostly government-affiliated labor unions and representatives of employers with the presence of government representatives, the minimum wage for the year 1394 was determined to be 712,000 tomans, which had a 17% increase compared to the minimum wage in the previous year. The basis for determining the minimum wage and in fact the amount of its increase was the inflation rate announced by the Central Bank – 15% – in the year 1393.

Labor representatives present at the negotiations insisted that the inflation announced by the central bank is not real for various reasons and that the actual inflation rate is much higher. Therefore, it cannot be a valid measure for the increase in workers’ expenses and minimum wages.

In fact, in order to calculate the minimum wage, the “household basket” should also be taken into account, which is calculated based on the current prices of consumer goods. Therefore, unlike the inflation rate and especially the rate announced by the central bank, it is more accurate and up-to-date. According to the household basket, the minimum wage should be set at 2 million and 350 thousand tomans, but in the end, the same inflation rate of 15% was calculated and the amount of 712 thousand tomans was determined as the minimum wage.

The necessity of setting a numerical amount as the minimum wage is a completely specialized economic discussion that neither the writer nor this article has the expertise or scope to delve into. However, some believe that setting a numerical amount as the minimum wage, if it exceeds the market and employer’s capacity, will lead to an increase in the employer’s expenses, which the employer then passes on to other sectors, causing inflation, unemployment, and capital flight. On the other hand, increasing the cash income of workers also leads to inflation, and for this reason, many countries refrain from setting a minimum wage.

In front of the supporters of setting a minimum wage, they believe that this is the only remaining option to defend workers in underdeveloped countries, in the absence of a healthy economy and strong independent labor unions. Even though setting a high minimum wage may cause inflation in the short term, it will lead to increased consumption by workers and a boost in the domestic economy in the long term. Another argument they make is that in developed countries where there is a high minimum wage, the inflation rate is also very low, even though the minimum wage is not necessarily set or approved.

Regardless of the economic discussion, the difference between the figures resulting from calculating the “household basket” and the minimum wage set at 2 million and 350 thousand tomans compared to 712 thousand tomans, shows that the outcome of these negotiations was ultimately a defeat for Iranian workers. This defeat clearly demonstrates the severe weakness of Iranian workers in bargaining with employers, and a thorough examination of the reasons for this defeat can shed light on the path ahead for Iranian workers and the existing obstacles, although all of these reasons are somehow related and ultimately lead back to the government.

The main reason for the weakness of labor representatives was that the labor groups present in the negotiations, like in previous years, were not the true representatives of the workers. The Workers’ House, the Islamic Labor Council, and other groups recognized by the Iranian Constitution are mostly government-affiliated and have deep economic and ideological ties with the government. Therefore, they ultimately choose to serve the interests of the government instead of defending the rights of the workers. True labor organizations not only do not exist, but forming them is considered a crime and the government has an extremely security-oriented approach towards this issue, as we have seen in dealing with the bus drivers’ syndicate, the Haft Tappeh company, and even individual workers’ movements.

Another guide to the overall policies of the Islamic Republic, especially after the implementation of the reverse principle 44 and the widespread privatization policies and elimination of subsidies, has generally been aimed at reducing the bargaining power of workers and reducing the cost of labor. Policies such as excluding workshops with less than ten workers from the scope of labor law, recognizing and increasing human resource contractor companies that have appeared as labor brokers, and increasing temporary contracts, have all been policies aimed at reducing the cost of labor and reducing the bargaining power of workers.

With the explanation above, the presence of government representatives in worker-employer negotiations is considered one of the reasons for the failure of workers. The government in Iran is still the largest employer and even recent privatizations have not been able to make a difference in this reality. Despite the fact that privatization in Iran has mostly been the transfer of state-owned companies to semi-state-owned companies, which has only reduced their responsibility towards workers and society, the government cannot play a supervisory or intermediary role in worker-employer negotiations in Iran.

For all these reasons, in these negotiations, there could not be any result other than failure for the workers, and Iranian workers are forced to find and create their own true representatives, increase their bargaining power, and increase the cost of labor, not only with employers but also with the government, and not only with the government’s economic policies but also with its security policies.