Category Archives: Minimum Wage

Minimum Wage Hike Only a First Step, Myanmar Labor Activists Say

Minimum Wage Hike Only a First Step, Labor Activists Say

YANGON — As Myanmar’s new daily minimum wage of 4,800 kyats (USD3.50) takes effect, labor-rights advocates are emphasizing that further steps are needed, including monitoring to ensure that workers are actually being paid the full amount, and that their basic needs are being met.

Monday’s increase was the first since the country introduced a minimum wage of 3,600 kyats ($2.65) in September 2015. However, a lack of proper enforcement mechanisms means many people are still working for below minimum wage, more than two-and-a-half years after the law was passed, said Daw Khaing Zar Aung, a member of the Confederation of Trade Unions Myanmar (CTUM)’s executive committee.

The confederation is currently assisting two groups of workers totaling about 200 people in two factories who are still not being paid the minimum wage, she said.

“It is important to make sure all employees get paid the minimum wage of 4,800 kyats,” she said.

Daw Khaing Zar Aung added that public forums need to be conducted in other states and regions in order to raise awareness about the minimum wage, along with monitoring and follow-up work.

The new rate of 4,800 kyats took effect Monday, according to an announcement by the National Committee for Designating Minimum Wages. The committee said the rate for an eight-hour working day would not apply to small, family-run businesses that employ fewer than 10 people.

The rate was decided in March after a long period of consultation. It faced objections from both workers and employers, with most workers demanding an average minimum wage of 5,600 kyats and employers unwilling to pay more than 4,000 kyats.

Daw Hla Hla, an executive member of the All Myanmar Trade Union, said 4,800 kyats is not sufficient to cover the daily living costs of workers.

The country’s Minimum Wage Law states that the wage must meet the essential needs of workers and their families, but the current rate isn’t even sufficient for one person to survive on, let alone their families, she said.

The All Myanmar Trade Union has called for a minimum wage of 5,600 kyats since 2015, said Daw Hla Hla.

CTUM’s Daw Khaing Zar Aung, who is also a member of the National Committee for Designating Minimum Wages, said she wasn’t satisfied with the 4,800-kyats rate, either.

The committee comprises economists, officials from concerned ministries and representatives of labor and employer groups.

She said the committee was unable to properly surveys workers’ living costs in states and divisions due to time constraints. As a result, some of the survey results do not accurately reflect the workers’ real cost of living, she added.

The group advised the committee to conduct regular meetings every six months. It also urged it to meet with employees and employers periodically to update them and to conduct follow-up work. It recommended more time be spent conducting the surveys, she said.

Another significant problem is that some employers cut other allowances and benefits when the basic wage is increased.

Such problems were encountered when the country’s first minimum wage of 3,600 kyats was established in 2015, said Ko Ye Naing Win, a labor rights advocate who previously worked for the Arbitration Council for Labor Disputes.

He said employers had reduced or abolished allowances and other benefits, so there was not much difference for workers. Commodity prices had increased, putting pressure on employers and leading to labor strikes, he added.

The government needed to protect the rights of the laborers, he said.

The minimum wage is intended as a basic salary for unskilled workers (especially those entering the workforce), and pay raises are still expected to be paid as an employee gains in skill and experience, he said.

“The new rate is does not fully cover employees’ cost of living, but employers claim they have difficulty paying more than that. Given that, the government also needs to draft policies for the betterment of employees,” Ko Ye Naing Win said.

He stressed the need to implement welfare schemes for workers such as housing projects with low-priced rental apartments and low-cost restaurants to ease the impact of rising living costs.

Under the Minimum Wage Law, a new rate must be enacted every two years.

Written by: San Yamin Aung
Source: The Irrawaddy
Published on: 16 May 2018

Garment exports to slow ( Cambodia)

Workers at the Kin Tai garment for Armani jeans on the outskirts of Phnom Penh in late 2015. Kimberley McCosker

Cambodia’s garment and footwear exports will likely see a slower percentage of growth this year at around 5 percent, compared with 7 percent in 2016, a trend that industry insiders dismissed as not being indicative of an overall decline or linked to the current political situation.

Speaking yesterday at the annual Cambodia Textile Summit, Ken Loo, secretary-general of the Garment Manufacturers Association in Cambodia, said that slower growth in the garment and footwear sector was a normal market occurrence as the overall production base increases.

“As your base number gets bigger and bigger, in terms of percentage growth, you cannot expect to grow at the same rate forever,” he said. “So far, the trade [in the garment industry] has not been affected by the current situation yet.”

Despite Loo being unable to release export figures for the first nine months of this year, he did add that 25 new factories had opened in Cambodia this year while 53 had shuttered operations.

While he was generally positive about the industry’s health, he warned that the increase of the minimum wage – going from $153 a month to $170 a month effective January 1 – would cause the Kingdom to gradually lose its competitive advantage as a low-cost destination. He urged the government to help reduce the cost of doing business, warning that manufacturers will soon need to increase productivity to remain competitive in the footloose industry.

“Going forward, with the minimum wage going to $170, more factories will encounter difficulties if the other things don’t change,” he said. “So, we hope that there is a change in productivity, a lowering of cost of doing business, and there will be new government policy that helps us offset the rising labour cost and allows factories to continue to operate.”

According to data from the Customs Department, Cambodia exported $7.3 billion worth of apparel and footwear products in 2016, compared to $6.8 billion in 2015. The sector accounts for more than 70 percent of the country’s total exports with the vast majority of its products destined for the EU, US and Canada.

Eric Tavernier, CEO of We Group Ltd, a French firm that operates a garment factory in Sihanoukville, explained that the price difference associated with the minimum wage hike was marginally symbolic in a regional sense as productivity remained a paramount concern.

“On the paper monthly salary is 60 percent cheaper in Cambodia compared to China,” he said. “But the production speed in Cambodia is only 35 percent compared to 75 percent in China, which at the end of the day only makes Cambodia 30 percent cheaper when efficiency is factored in.”

Meanwhile, the latest economic outlook released last week by the International Monetary Fund predicted that the Kingdom’s garment sector would grow at a slower pace owing to increased competition from neighbouring countries. However, the IMF said that preferential US trade access for specific travel-related items could help prop up the sector in the near-term.

Enjoy Ho, president of the textile enterprise association at the Chinese Chamber of Commerce in Cambodia, said that the Kingdom’s advantages for attracting investment into the garment sector remains its abundance of cheap labour and preferential trade status under the EU’s Everything But Arms scheme and duty-free access to the US for travel goods.

However, he opined that the minimum wage hike would surely jeopardise the sector if worker productivity does not increase.

“With the increasing of the minimum wage, we are struggling to keep the same order price compared to previous years,” he said. “We have very small survival space.”

He said that if the government did not act quickly to decrease the burden on factory owners, whether that is by cutting electricity costs or lowering import and export fees, “factories will definitely close”.

By: Hor Kimsay and Robin Spiess, Phnom Penh Post

Published on: 26 Ocotober 2017

Workers told of wages boost ( Cambodia)

Garment workers have been told their wages and benefits will reach $200. Heng Voneath

Prime Minister Hun Sen has allocated about $40 million per year from next year after the garment and footwear industry workers’ minimum wage increased to $170 per month.

Mr Hun Sen posted on Facebook on Sunday that from 2018, garment workers would receive more than $200 per month when benefits were added to the new $170 minimum wage.

He said the employers had offered $165 but the government added another $5. The additional money would come from changes to the withholding of tax and fees from exports.

“The government has prepared the budget of about $40 million annually to add to your wages,” he told the workers.

He said that in 1997, the garment workers’ wage was only $40 per month, but today they had $153 per month and when other benefits were included, they would receive $200 or more.

However, Far Saly, president of National Trade Unions Coalition, said yesterday that the government should not spend a lot of money adding to workers’ wages or benefits because the employers have the ability to pay.

“I think it is not difficult for the companies to spend this money,” he said. “I asked some company owners and they said that they would still be able to proceed with their business.

“But if the minimum wage is higher than this, it will affect small factories and sub-contractors who do not have the ability to pay high wages.”

By: Mom Kunthear, Khmer Times

Published on: 24 October 2017

Workers live in shadow of poverty (Burma/Myanmar)

Ko Kyaw Kyaw Lin (left) and his wife Ma Khin Hnin Wai in their house in Hlaing Tharyar Industrial Zone 2. Zarni Phyo/The Myanmar Times

Tucked in the corner of the Hlaing Tharyar Industrial Zone 2, factory worker Ko Kyaw Kyaw Lin’s house is a little ramshackle where he lives with his wife of three years.

The 29 years-old works for the Silver Lion Fiber Glass Company in the industrial zone and his take home salary is a paltry K130,000 after a month’s hard work .

“If we combine both our salaries my wife’s and mine, it is just over K300,000 per month. It is insufficient as we’re in debt too. We had to send our kid back to the village because we couldn’t provide for her,” he told The Myanmar Times in an interview last week.

He has been with  the company for over eight years now and married. In 2009, his  basic salary was only K20,000 and now his gross salary is K130,000 including attendance payment.

To supplement the family’s income, Ko Kyaw Kyaw Lin’s spouse  Ma Khin Hnin Wai, 26, works at the Cellon Myanmar Garment Factory, where she earns K180,000 per month.

The two struggle to make ends meet and had to send their daughter when she was just two months old to Nyaungton township, Ayerwady region –  a five hour drive do them apart.

“Even though I am yearning for my daughter, we can’t bring her back because our earnings are not enough to support her here,” lamented Ko Kyaw Kyaw Lin’s wife. “I try to heal my heart by looking at her pictures.”

Ko Kyaw Kyaw Lin is now facing health problems after being exposed to hazards at work place and wants to quit his job, but unable to do so as he is waiting for his medical results, which could help him get compensation from the company if he is discovered to have any disease.

The Myanmar Times reporters ventured to Hlaing Tharyar industrial zone to recollect tales of those  working in the industrial era.

Dozens of little houses are perched  along the edge of the factory areas, some recently settled, while other others have been living for over 10 years.

It was discovered that with limited income, no proper access to healthcare, exposed to health hazards at workplace and absence of safety net if they lost their jobs,  thousands of factory workers struggle to eke out a tough life,  like Ko Kyaw Kyaw Lin and his wife. They  live in dingy homes and separated from loved ones and many forced to make a hard decision to leave their families as economic opportunities are scarce back home.

The fruits of Myanmar sizzling economic success over the past years are yet to trickle down to these groups of workers.

Based on K4,000 per day salary, workers would earn about K120,000 per month, excluding overtime. If overtime is included they could roughly earn about  K172,000.

Meanwhile, if  minimum wages is fixed at K4,400, workers will earn K132,000  as basic salary and get K189,000, if 5 hours overtime is included.

If wages are fixed at K4,800, a worker will earn K144,000 as basic salary and get K206,400 if five hours overtime is added.

According to workers, living costs – including room rental and food expenses – amounted to nearly K80,000 a month and rose to K120,000 due to the rising cost of basic commodities.

Choked by the price of living with regard to their meager salaries, employees struggle to survive on their current wages.

Ko Myo Zaw also works in a textile factory at Hlaing Tharyar.  Likewise, he got married three years ago and dreamt  of having a kid. But it may be just a dream when he thinks of the current costs to bring her up – living, healthcare and education costs  for his child. It is beyond  his reach, at least for the moment.

Unfortunately, these are not isolated cases. Many others migrated from rural areas to Yangon’s industrial zone, in search of employment. In 2016-17, over 130,000 workers have been employed in seven categories of work throughout the complex. ,

“In my nine years here, I have never been to places in Yangon, except for Shwedagon Pagoda. I don’t want to spend extra money, it is usually work and back to my room. My life is like a robot,” said Ma Aye Myat Thu, aged 26, a worker from Ever Sunny Industry Co Ltd.

Rental is a major issue for workers and many lease apartments to live in  groups in cramped rooms.  Four or five staff share an accommodation to save costs.

“I can’t afford to pay the rental by myself on my current salary. Therefore, I stay with my  flat mates to share the cost,” said Ko Thein Htet Aung, 21 who  works in the food industry.

The rental  of room, house and flat which can accommodate three to five people, range anything from K32,000 to  K75,000 in Hlaing Tharyar and Shwe Pyi Thar townships, where most factory workers live.

According to the workers from Hlaing Tharyar industrial zones, their monthly living cost is between K100,000 and K200,000.

U Myo Zaw, member of Confederation of Trade Unions Myanmar (CTUM) said workers spend nearly 95 percent of their monthly salaries on living cost and they could not cover other social costs with the rest of their wages.

In 2015, the government fixed K3,600 for eight hours of work as minimum wage. However, labour unions criticised that this amount is insufficient to cover living expenses and demand a raise to K5,600. And, this led to frequent labour disputes between workers and factory owners.

But there could be silver lining to workers’ sufferings soon as various stakeholders from the government, employers and employees organisations are busy negotiating  a decent minimum wage for workers next year.
The CTUM is demanding for K6600 minimum wage while the Labour Ministry had proposed K4000 to K4800 wage bracket.

But certain groups, especially employers hinted that any excessive rise in wages, at a time when the economy is slowing down, could impact businesses and some factories may be forced to close down due to high overheads.
The National Committee for New Minimum Wages has to finalised the exact minimum wage by 2018.

With rising cost of living and inflation at 4pc, workers must be paid a decent salary, like in neighbouring countries, or they will be pushed to the brink of poverty.

By: Nyan Lynn Aung, Myanmar Times

Published on: 20 October 2017

Workers group want Thailand to raise daily wages to 700 baht

Workers’ lobby groups wants the Thai government to raise daily wages for all workers, including local and foreign, to 700 baht (nearly K 28,500) from the current about 350 baht per day to commensurate with the rising cost of living.

The Thailand labor unions, the State Enterprise Workers Relation Confederation, Thai Labour Solidarity Committee and Migrant Workers Rights Network (MWRN) collectively demanded for a wage revision during the ‘World Day for Decent Work’ that was held on October 7.

“We and the Thai labour organisations asked for this wage according to the ILO convention, because the ILO convention states that a man’s wage should be enough to support his family members,”  MWRN’s president U Aung Kyaw told The Myanmar Times yesterday.

The workers’ organisations have also urged Thailand to sign and abide to the ILO conventions No. 87 (freedom of Association)and 98 (Right to Organise).

U Aung Kyaw said that a worker must be paid 712 baht to match the current cost of living in Thailand based on their calculations.

“We asked for 360 baht as daily wage last year. However, the Thai government added extra 10 baht to the daily wage of 300 baht. So, we have to demand for better benefits for the workers,” U Aung Kyaw said.

Currently, Thai employers pay about 305 to 310 baht as daily wage for each worker, while some factories pay between 320 and 350 baht, which is more than the fixed daily wage for a worker, according to MWRN.

“700 baht is impossible as daily wage here. But, daily wages should be between 450 to 500 baht now a days,” said Ko Shwe Tun Aye, chair of Migrants Workers Network (Phuket).

He also said that some Thai factories are paying 400 to 450 baht as daily wage and some Myanmar skilled workers earn that amount in Thailand.

According to the migrant rights groups and officials, an estimated four million Myanmar nationals are working in Thailand at present. Among them about 700,000 do not have any valid work documents.

By: Zaw Zaw Htwe, Myanmar Times

Published on: 11 October 2017

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