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PM adds $2 to minimum wage agreed for next year

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Garment workers leave their factory after work in Dangkor district on the outskirts of Phnom Penh in July. Hong Menea

PM adds $2 to minimum wage agreed for next year

The National Council on Minimum Wage (NCMW) voted to set minimum wage for workers in the garment, textile and footwear sectors at $192 for 2022. Prime Minister Hun Sen then stepped in to add $2 to the total, making it $194 per month.

The NCMW consists of 51 officials from the Ministry of Labour and Vocational Training, factory owner representatives, industry stakeholders and workers’ representatives from civil society organisations and trade unions.

On September 28, the council took a vote on three competing minimum wages proposed for 2022. The workers’ representatives requested $204, the employers and industry representatives offered $188 and the compromise figure of $192 – meaning no change to the 2021 wage – was suggested by government officials.

The votes tallied up to 45 in favour of the $192 wage, six for the $204 figure and no votes cast at all for the employers’ proposal that the minimum pay be lowered to $188.

In an announcement issued after the vote, the labour ministry said Hun Sen was adding another $2 to the $192 figure, of which the council overwhelmingly voted in favour.

“The minimum wage for workers in the textile, garment, footwear and travel goods sector for 2022 has been formally set at $194 a month,” the ministry announced.

It also said the wage limit for probationary workers was $192 a month. When workers work more hours per week than the number stated in the terms of their contract or over the maximum allowed by Cambodian law at regular wages, they will be paid an overtime rate.

“All other benefits that workers have received in past years have been retained for 2022. This new minimum wage will be implemented from January 1, 2022 onwards,” the ministry said.

Pav Sina, president of the Collective Union of Movement of Workers, said the $2 increase in the minimum wage for next year was not enough to keep up with cost-of-living inflation or to deal with the reality of the economic distress inflicted by the Covid-19 pandemic these past two years, which saw workers’ debt burden rises considerably.

“Although this result has been formally announced, as a worker and employee, I request that all stakeholders reconsider the possibility of raising wages higher than that because $2 more cannot meet the cost of living,” he said.

However, Garment Manufacturers Association in Cambodia deputy secretary-general Kang Monika said even a $2 increase would have a negative impact on the bottom line for the factories, which he said were also suffering downturns due to the global economic slump brought on by Covid-19.

“We’re dealing with the same reality here on the ground and we already know that we have other costs of doing business that are expected to increase as well.

“For 2022, we are going to be paying two per cent more of the total wages as our contribution towards the pension fund for workers along with between one and 1.5 per cent more to fund the Covid-19 healthcare treatments and vaccines for our workers,” he said.

He also noted that the factories continued to be responsible for the costs of implementing all of the Covid-19 preventive measures to ensure the safety and health of their workers. This, he said, includes the costs incurred by regular testing and providing masks and also hand sanitisers for everyone. He estimated that the cost per month per worker for the factories was $3.5 to $4 each.

The labour ministry estimated that the new wage will actually compensate workers at a rate equivalent to $211 to $222 a month when all other benefits provided are accounted for and included in the total.

Tang Saruon, a factory worker in Phnom Penh, said she was not happy about the new wage amount. She said raising the minimum wage by only $2 did nothing to improve the lives of workers.

“I personally do not have much money. If the government has already decided, then I don’t know what to say because our livelihoods are getting us nowhere. In fact, from year to year things have gotten worse and then whenever our salaries do go up, the cost of everything else goes up too,” she said.

Mey Chan, another worker at a factory in Kandal province, said due to the current situation he felt the best they could hope for was that their current salaries and benefits would not be slashed to cut costs.

He said although his current salary is not enough to get by on, he understood that the country and the whole world was facing a crisis caused by the pandemic so he considered his share of the economic woes as his contribution towards shouldering some of that burden.

“Of course the amount of salary we make has a real affect on our livelihoods, but we must be realistic about the situation our country is facing with Covid-19. If we were to force [the employers] to increase our wages, it would be difficult for them to do so.

“The government is also spending a lot of their budget on providing treatment to anyone who contracts Covid-19 and for vaccines, and I think right now we should just join hands and stave off this virus as our first priority,” he said.

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