Garment-Sector Raises Hit by Falling Overtime

Garment workers around the country have started picking up paychecks this month that for the first time include the $28 increase the government added to the sector’s previous minimum wage of $100. But with available overtime hours on the wane, enthusiasm for the raise is muted.

Outside factories around Phnom Penh over the past two days, workers said that both rising prices and falling overtime meant they took home less than an extra $28 for the work they put in last month. Some said they even earned less than they did before the raise.

Garment workers buy lunch Monday outside the Hoyear Garment factory in Phnom Penh's Meanchey district. (Siv Channa/The Cambodia Daily)
Garment workers buy lunch Monday outside the Hoyear Garment factory in Phnom Penh’s Meanchey district. (Siv Channa/The Cambodia Daily)

Sem Pao, who supplements her work at the Bright Sky factory in Pur Senchey district as a hairdresser on her days off, said she picked up her paycheck on Thursday and that the $215 was only about $10 more than the month before.

“Our wages increased this month, but it’s almost the same as the last month because we don’t have overtime work to do,” she said. “Before we could work overtime, but they don’t ask anymore because orders are down.”

Landlords and vendors around factories reliably up their prices whenever factories raise their wages, and Ms. Pao said this time was no different.

“Before we spent 18,000 riel [about $4.50] a day for food, and now we spend about 20,000 riel [about $5] a day,” she said. “We used to spend $35 a month for rent, but now we have to spend $40.”

At the Cambo Kotop factory in Pur Senchey, Hean Chinda said she also earned more in January with the added help of some overtime.

“But it is still not enough for our workers because the price of everything keeps rising,” she said.

The government recently launched a plan to help keep water and electricity costs down for garment workers, though it will take months to roll out.

Chhin Pearum, who works at the Makalot Garment factory in Meanchey district, said she went home with about $180 this month—$20 less than usual—when she picked up her paycheck on Saturday.

“Now we have more time to relax since there is not so much work to do,” she said.

But Ms. Pearum said it also means she won’t be sending more than the usual $70 a month she sends back to her family in the provinces.

Many of the country’s 600,000 garment workers live away from home and send a significant portion of their pay back to their families every month.

But many of the roughly 500 factories where they work reported significant drops in orders from abroad during the last half of last year, forcing them to cut back on overtime hours.

The factories blame the falling orders on nationwide garment worker protests in late 2013 and early 2014 and ongoing wildcat strikes that have shaken buyer confidence in Cambodia. The new minimum wage also makes Cambodia’s garment industry less competitive compared to its regional rivals, including Bangladesh, which still has a $68 minimum wage.

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