ILO and partners advance standardized wage framework for Ethiopia’s horticulture sector

The ILO, the Ethiopian Horticulture Producer Exporters Association (EHPEA), and tripartite partners have taken a key step toward establishing a standardized wage framework for Ethiopia’s horticulture sector, following the validation of an assessment of cluster-based wage systems in Addis Ababa.

Participants at the validation workshop emphasized that more transparent, predictable and well-governed wage systems can strengthen decent work, support responsible business practices and enhance the competitiveness of Ethiopia’s horticulture sector.

The workshop, led by the International Labour Organization through Siraye’s Setting Adequate Wages in Agriculture (SAW-A) project and the ILO Global Centre on Digital Wages for Decent Work, and organized in collaboration with EHPEA, brought together farm managers, worker representatives, regional authorities, national institutions and tripartite partners.

The discussion marked a transition from analysis to shared action. Participants reviewed the findings of an assessment of cluster-based wage systems in Ethiopia’s horticulture sector, focusing on wage adequacy, transparency and governance, and explored how these insights can inform practical reforms across the sector.

Horticulture remains one of Ethiopia’s leading export industries and a major source of formal wage employment, especially for women. As the sector continues to grow, improving workers’ incomes while maintaining enterprise sustainability is a shared priority for workers, employers and government.

Welcoming the participants of the workshop, Khumbula Ndaba, Director of the ILO Country Office for Ethiopia, Djibouti, Somalia, Sudan and South Sudan, underscored the broader economic role of wage systems.

“Well-designed wage systems can serve as a powerful instrument for economic transformation, productivity growth and social progress. Fair and predictable wages increase workers’ purchasing power, supporting domestic demand and stimulating local economic activity,” said Ndaba.

The assessment examines wage structures across the sector, including base pay, allowances, in-kind benefits, wage payment systems and disparities across regions, contract types and gender. It also identifies opportunities to enhance transparency and efficiency, including through the expansion of digital wage payments.

Participants validated the findings, identified remaining gaps and discussed practical measures to strengthen wage adequacy, wage transparency and sector- wide social dialogue.

The discussions are expected to inform the development of a standardized wage framework that reflects operational realities, incorporates worker perspectives and supports a competitive and sustainable horticulture sector.

Welcoming participants on behalf of the Government of Ethiopia, Tiumegzi Berhe Fikadu, CEO for Industrial Relations and Labour Inspection at the Ministry of Labor and Skill- FDRE, emphasized that sustainable wage systems require credible evidence, sector realities, productivity considerations and strong social dialogue. “Strengthening transparent and credible wage systems is becoming increasingly important for both workers and enterprises.”

Speaking on behalf of EHPEA’s Executive Director, Ms Yodit Girma highlighted the progress achieved through constructive dialogue between employers and workers.

“The introduction of the cluster-based wage scheme has contributed to improved wage levels across the sector and has also resulted in better industrial harmony between employers and workers,” she said.

She reaffirmed EHPEA’s commitment to promoting decent work, constructive social dialogue and a resilient and thriving horticulture industry that benefits both employers and workers.

EHPEA has played a leading role in initiating the cluster-based wage approach through negotiations between farm management and trade unions. The approach was designed to support a fair, transparent and structured wage-setting mechanism that responds to the realities of the sector.

The workshop also provided an opportunity for stakeholders to assess the feasibility of proposed recommendations and agree on priorities for implementation. Discussions focused on building consensus around wage standardization, strengthening social dialogue and improving wage governance in the sector.

The outcomes of the workshop will inform the final assessment report and support the development of a standardized wage framework for Ethiopia’s horticulture sector. The framework is expected to contribute to stronger wage-setting practices, improved transparency and more sustainable industrial relations.

Ndaba said a credible framework must combine evidence with ownership.

“A credible wage framework is not only about technical evidence. It is also about shared ownership by the people and institutions who will put it into practice. Today’s workshop is an important step in building that consensus.”

The workshop forms part of the ILO’s broader support to strengthen wage-setting systems in Ethiopia’s agriculture sector and to promote decent work, social dialogue and sustainable enterprises.