GovernmentLao EconomyRules and Law

Minimum Wage Hike In The Pipeline

Source: Vientiane Times

A tripartite meeting held in Vientiane recently agreed to increase the minimum wage from the present 900,000 kip to 1.2 million kip a month, a senior official has confirmed.

The meeting brought together representatives from the Lao Federation of Trade Unions (LFTU), the Ministry of Labour and Social Welfare and the Lao National Chamber of Commerce and Industry.

Director General of the LFTU’s Labour Protection Department, Mr Ounkham Ounyaseng, told Vientiane Times on Monday “The government’s monthly meeting last month agreed to the wage increase.”

The Ministry of Labour and Social Welfare will make another proposal and submit it to the government. If it is approved, the Prime Minister will issue a decree to implement the new minimum wage.

Mr Ounkham said a pay rise was vital to improve workers’ livelihoods and ease their hardships amid rising costs, with product prices rising every month or year.

“900,000 kip a month is not enough to live on, and many items are increasingly expensive,” he said.
“Employers should sympathise with workers and help them to improve their living conditions, especially as labourers are the ones enabling their employers to make a profit.”

Mr Ounkham said many factories and companies had jobs on offer but few people were interested in working for such low pay.

The low salaries offered by employers in Laos drive many people across the border to seek work in Thailand where the wages are higher.

“If we compare the minimum wage in Laos to those of our neighbours, including Myanmar, Cambodia and Thailand, we are the lowest,” Mr Ounkham said.

“We carried out a nationwide survey to determine whether the existing minimum wage is adequate for the cost of living and found that it does not match the current circumstances.”

A garment factory worker, Mr Vong, said “I don’t have anything left at the end of the month to save. All of my money is mostly spent on food. I want to save money for other essentials such as clothes and medicines when I get sick.”

Minister of Industry and Commerce Ms Khemmani Pholsena told the recent National Assembly session that prices of food staples in Laos are 10-20 percent higher than in Thailand and Vietnam.

In recent years, the government has approved increases in the minimum wage to enable workers to cope with the rising cost of living.

In 2012 the government raised the minimum wage from 348,000 kip to 626,000 kip a month, and in 2015 ordered a further hike to 900,000 kip a month.

According to the Lao Federation of Trade Unions, last year Laos had about 551,200 labourers, many of whom work for various businesses and are largely unskilled, with some 70 percent working in the industrial sector.


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