ILO workshop tackles minimum wage issues

Mom Kunthear / Khmer Times 2 Comments Share:
Labour Minister Ith Samheng leads a minimum wage meeting. MOL

The Labour Ministry and the International Labour Organisation are working together to increase the technical abilities of members of the Labour Advisory Committee who are tasked with monitoring and evaluating the status of the Kingdom’s minimum wage.

Labour Ministry spokesman Heng Sour yesterday said during a workshop on Minimum Wage Monitoring in Cambodia that the government has followed and implemented minimum wage principles based on evidence.

“We see that the minimum wage negotiations in Cambodia were smooth,” Mr Sour said. “Some parties that attended the minimum wage negotiations were not happy, but the process has been better than before.”

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He added in order to support the monitoring mechanism, the Labour Ministry has established regulations.

“The minimum wage law was created to ensure a decent living standard for workers,” Mr Sour said. “The workshop today is aimed at strengthening the government’s technical abilities when it comes to minimum wage monitoring.”

Graeme Buckley, ILO director for Indochina, yesterday said the job of the organisation is to “protect workers against unduly low pay”.

“Minimum wages can be an important element of a policy to overcome poverty and reduce inequality,” Mr Buckley said. “A well designed and effective minimum wage policy can contribute to reducing inequality.”

He added that recent studies have shown that a minimum wage proportional to a country’s economy can contribute to a higher level of labour productivity.

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Last month, a tripartite commission consisting of government officials, union leaders and employers determined that $182 will be the new minimum wage for workers in the textile industry next year. The minimum wage is $170 per month this year.

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2 Comments

  1. What’s better than raising the minimum wage by $X/week? A punitive #VacancyTax / #VacantLandTax, which property owners are so keen to *avoid* that it reduces *rents* by $X/week. Why is this better? Because:
    (1) When you allow for income tax (and income-tested welfare, where applicable), a dollar *saved* is worth much more than a dollar *earned*.
    (2) By definition, the benefit of lower rents, unlike the benefit of higher wages, isn’t competed away in higher rents. Indeed, if landlords know that wages have risen by $X/week, they may try to raise rents by the whole $X/week, not allowing for what is clawed back through the tax-welfare system.
    (3) Nobody says lower rents will price workers out of a job! On the contrary, the scramble to avoid the vacancy tax will *create* jobs; and lower rents by themselves create jobs, because jobs can’t exist unless (i) the employers can afford business accommodation, and (ii) the employees can afford housing within reach of their jobs, on wages that the employers can pay. (Note the implication that the tax should apply to both commercial and residential property.)
    (4) Why should employers pay for a problem caused by land-hoarders?
    (5) The economic activity driven by a vacancy tax broadens the bases of other taxes, allowing their rates to be reduced, so that the rest of us get lower taxes!