Employers failing to pay new minimum wage
 
The Ministry of Labour and Social Welfare recently announced a new minimum wage, to assist workers facing financial hardship due to the continuing rising cost of living and depreciation of the kip.

The wage hike meant that employers were required to start paying the minimum monthly wage of 2.5 million kip on October 1.
However, some privately owned companies in Vientiane are still not paying the new minimum wage, including factory owners, who say that because workers are unskilled they should not receive a pay increase.
Addressing the National Assembly earlier this month, the Minister of Labour and Social Welfare, Mrs Baykham Khattiya, highlighted the successful efforts of authorities in assisting Lao workers both in Laos and overseas, but called on business operators to ensure they maintained a good working environment and paid their workers more.
Employers who currently pay less than the statutory minimum wage must increase the size of pay packets to match the newly legislated minimum, she said.
The low salaries offered by employers in Laos drive many people across the border to seek work in Thailand where the wages are higher, she noted.
A member of the Lao National Chamber of Commerce and Industry said the wage increase was welcome but that business operators may be reluctant to pay the new minimum because most of their workers are unskilled.
In response, Mrs Bakkham said that in addition to paying the newly decreed minimum wage, business managers must comply with welfare regulations to attract more workers, and ensure they have a decent standard of living.
Integration in the era of globalisation is driving the search for better opportunities, whether the pursuit of skills development, better working conditions, or a higher wage.
All workers have the right to decent living conditions and a fair wage that enables them to afford basic comforts despite rising costs, with prices in Laos rising every month and year.
The minimum wage increase applies to all workers earning less than the set threshold, excluding overtime, welfare payments, and other benefits.
In recent years, the government has legislated several increases in the minimum wage but is unable to prevent increases in the price of food and consumer goods.  
According to the Ministry of Labour and Social Welfare, the government first increased the minimum wage in 1991.
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, followed by the latest increase to 2.5 million kip in October.

By Phetphoxay Sengpaseuth
 (Latest Update December 25, 2024)