Thailand to scrap minimum wage after 3 years

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Toyota factory thailandThailand’s 300-baht-per-day ($9) national daily minimum wage will be scrapped next year to be replaced by the old system where wages vary by each province based on the cost of living, labour ministry permanent secretary Nakhon Silpa-archa was quoted by Thai media as saying at a seminar of wage committee members on June 5.

The minimum wage came into effect on January 1, 2013. Since then all of Thailand’s employers had to pay all employees at least 300 baht a day. If they didn’t, they faced six months in jail and/or a 100,000 baht fine for not complying. The policy was the fulfillment of a 2011 election campaign pledge by Yingluch Shinawatra’s Pheu Thai party.

It remains undecided whether the daily minimum wage will be higher but the Wage Committee decided on December 8, 2014 to reinstate the old regime where wages vary by the cost of living and the economy of each province, he said.

“The ministry is studying the feasibility of floating wages and an appropriate way to set the rates,” he added.

The change will “increase Thailand’s competitiveness and employment rates,” Nakorn said, adding it would also improve the living conditions of workers and reduce wage disparities. Employees will have to improve their skills and productivity, the key factors determining wages and incomes .

For 2016, the provincial wage committees were asked to study and propose the wages, to be considered at a national meeting in October. A guideline for 2016 will also be used as a standard for the following years.

The Thai Labour Solidarity Committee proposed in late March that the minimum wage be increased to 360 baht a day after a 2015 survey found the cost of living of workers almost doubled from 2013.

The 300-baht minimum wage was a more than 100-per cent increase for workers in some provinces. It drew substantial resistance from employers who claimed it “undermined the country’s competitiveness.” The hike was also blamed for the current export slump Thailand is now facing.

The Yingluck government defended the move, saying the wage had not been revised for several years and was out of sync with the cost of living. It helped operators by providing tax breaks for machinery imports to replace more expensive labour.

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Reading Time: 2 minutes

Thailand’s 300-baht-per-day ($9) national daily minimum wage will be scrapped next year to be replaced by the old system where wages vary by each province based on the cost of living, labour ministry permanent secretary Nakhon Silpa-archa was quoted by Thai media as saying at a seminar of wage committee members on June 5.

Reading Time: 2 minutes

Toyota factory thailandThailand’s 300-baht-per-day ($9) national daily minimum wage will be scrapped next year to be replaced by the old system where wages vary by each province based on the cost of living, labour ministry permanent secretary Nakhon Silpa-archa was quoted by Thai media as saying at a seminar of wage committee members on June 5.

The minimum wage came into effect on January 1, 2013. Since then all of Thailand’s employers had to pay all employees at least 300 baht a day. If they didn’t, they faced six months in jail and/or a 100,000 baht fine for not complying. The policy was the fulfillment of a 2011 election campaign pledge by Yingluch Shinawatra’s Pheu Thai party.

It remains undecided whether the daily minimum wage will be higher but the Wage Committee decided on December 8, 2014 to reinstate the old regime where wages vary by the cost of living and the economy of each province, he said.

“The ministry is studying the feasibility of floating wages and an appropriate way to set the rates,” he added.

The change will “increase Thailand’s competitiveness and employment rates,” Nakorn said, adding it would also improve the living conditions of workers and reduce wage disparities. Employees will have to improve their skills and productivity, the key factors determining wages and incomes .

For 2016, the provincial wage committees were asked to study and propose the wages, to be considered at a national meeting in October. A guideline for 2016 will also be used as a standard for the following years.

The Thai Labour Solidarity Committee proposed in late March that the minimum wage be increased to 360 baht a day after a 2015 survey found the cost of living of workers almost doubled from 2013.

The 300-baht minimum wage was a more than 100-per cent increase for workers in some provinces. It drew substantial resistance from employers who claimed it “undermined the country’s competitiveness.” The hike was also blamed for the current export slump Thailand is now facing.

The Yingluck government defended the move, saying the wage had not been revised for several years and was out of sync with the cost of living. It helped operators by providing tax breaks for machinery imports to replace more expensive labour.

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