Salary increment should be based on performance

Kenya: COTU boss Francis Atwoli may be hilarious, but he was right on Labour Day in saying that workers deserve a raise since the cost of living has gone up. An employer tagging salary increment on performance or even the level of production is a worry for most workers as some employers are tax evaders. 

Could we have salaries increased every year at a fixed rate without considering what the companies are getting as a return? Is this model really sustainable in the tourism industry? Those who engage in productive activities have to factor in the cost of labour when determining prices. It is thus imperative that every time the cost of labour goes up, the firms can only recoup this cost by increasing prices or cutting on other factors so that the price goes up or marginally remains at the same point. At the risk of reducing their revenue, firms have to consider increase in price so as to meet rising costs in the factors of production.