Minimum wage rises of 5-8% tipped

Minimum wage rises of 5-8% tipped

A new hike in minimum daily wages of between 5% and 8% is expected in September, since the rates have remained unchanged for over two years, according to the Ministry of Labour and an association of employers.

The tripartite committee responsible for approving wage rises is expected to finish deliberation in August of a new proposal to raise the rates, said Surachai Chaitrakulthong, assistant to the minister.

The committee consists of representatives of the government, employers and employees.

One of its sub-committees is now compiling figures from all 77 provinces, which will be taken into consideration when the committee decides on the proposed hike, he said.

At this point the pay rise is estimated to be between 5% and 8%, which is in line with inflation and believed to help workers cope better with escalating living costs, he said.

Previously, when Labour Minister Suchart Chomklin announced his decision to push for higher wages effective from Jan 1 next year, many labour groups called for them to take effect this year instead, said Mr Surachai.

The groups said most workers have been struggling to cope with high living costs for so long that they deserve speedy help, while employer groups appeared willing to allow the new hike to begin two to three months sooner than expected, he said.

After the proposed hike rates are approved by the committee, they will be forwarded to the cabinet for endorsement, announced in the Royal Gazette and then take effect, he said.

The decision falls on the committee and politicians cannot interfere, despite such concerns being expressed by some labour associations, he added.

“If approved, this wage hike will become a measure to help both employers and their employees survive this economic situation,” Mr Surachai said.

As the country learned the hard way from adopting a single-rate wage hike, which badly affected the economy, a single rate hike won’t be an option this time, he said.

Thanit Sorat, vice-chairman of the Employers’ Confederation of Thailand (Ecot), said most employers understand how the inflation crisis has devalued the money workers are paid and that the new pay rise should be on par with inflation.

The highest minimum daily wage now is 336 baht, which applies only to Chon Buri and Phuket, while the lowest rate is 313 baht and the average rate is 321 baht, he said.

“A single rate hike to 712 baht per day, as proposed by one labour organisation, is impossible. Only small countries like Singapore, Brunei and Hong Kong use the single-rate wage system and they are small nations,” he added.

The labour market in the last half of this year is expected to slowly recover while remaining affected by the fragile economic state, Mr Surachai said.