The Ministry of Labor has instructed employers and unions in the country’s crucial garment sector to begin preparations for the next round of minimum wage negotiations.
In a statement released on Monday, the ministry said initial talks would be held in August, with a final round of negotiations involving factory owners, unions and the government set for October, and a new minimum wage to take effect in January.
“All parties have to conduct surveys on social criteria (family status, rate of inflation and cost of living) and economic criteria (productivity, competiveness, the labor market situation and profit rate), as well as the poverty line, as a basis to discuss the minimum wage in Cambodia,” the statement said.
After nearly two decades of wage stagnation, the government has in recent years made efforts to formalize the negotiation process and involve more unions in talks. Since 2012, the minimum wage has gone up by more than 100 percent, from $66 to $140.
After nationwide protests over the minimum wage temporarily shut down the garment sector in late 2013, annual wage adjustments have over the past two years been made without significant disruptions to industrial relations.
However, employers and unions representing some 700,000 workers in the sector remain far apart in their estimates of what constitutes a living wage. The two sides indicated on Monday that they would again be coming to this year’s negotiating table with very different recommendations.
Ken Loo, secretary-general of the Garment Manufacturers Association in Cambodia, said factory owners were struggling with the current minimum wage. “The industry is definitely not ready for a significant increase,” he said. “You already have so many instances of factory owners supposedly running away. So that is an indicator.”
Prominent labor leaders said a wage between $160 and $200 would be appropriate given basic living costs.
“I think that if garment workers can get over $160, they can survive,” said union leader Sieng Sambath, adding that more was needed to give workers a decent life.
(Additional reporting by Colin Meyn)