Labor Minister Proposes Annual Wage Rise

The government is considering raising the minimum wage for the country’s garment workers every year for the next five years, Labor Minister Ith Sam Heng said after a meeting Wednesday with manufacturers and unions on increasing the current monthly salary of $80.

Mr. Sam Heng presided over a meeting with the four technical working groups tasked with determining a new minimum wage for the 350,000-plus workers employed in the $4 billion garment industry. The wage is set to be raised in January, but no amount has yet been specified.

“We will build a report for raising the wage of the garment workers every year for five years during this government mandate,” Mr. Sam Heng said. “If economic inflation happens, we will discuss again.”

“We are not opposed to raising the minimum wage for workers, but I would like to appeal to all workers to calm down because we are going to raise it [in] January next year but we just don’t know how much yet,” he added.

Som Aun, president of the Cambodian Council of National Unions—a coalition of government-aligned unions—praised Mr. Sam Heng’s proposal of a gradual increase each year over five years. He added that independent unions’ current demand that the wage be raised to $154 a month is unrealistic.

“The amount raised by the unions seem a bit high, and I don’t know if [the government] can do that,” Mr. Aun said.

However, Oum Visal, legal official at the Coalition of Cambodia Apparel Workers Democratic Union, said the government should just commit to a dramatic increase.

“The minister said the wage can be increased to $170 at the end of five years if we study it and [find] that it can be done,” Mr. Visal said. “I would like to push for raising the wage to $170 for the initial raise [in January].”

Swedish retail giant H&M this week called for the governments of all their supplier countries to establish a “fair living wage” for workers by 2018.

When asked what H&M would consider a fair living wage in Cambodia, H&M press officer Andrea Roos said Wednesday that the workers and the government should agree on this amount themselves.

“We believe that the Cambodian government should conduct an annual review of the minimum wage, taking into consideration national inflation and the consumer price index,” Ms. Roos said in an email. “We do not believe in setting levels. We believe in negotiation where workers themselves decide what a living wage is for them.”

H&M had also called on other international brands to follow its example in paying supplier factories more to enable higher wages for workers.

German sports brand Puma said the company currently has no such plans of its own, while Laura Wilkinson, a spokeswoman for U.S. clothing brand Gap Inc., said Gap supported the effort “in principle.”

“While we won’t comment on the policies of other companies, Gap Inc. has long supported the principle that garment workers should receive wages that meet their basic needs,” she said in an email.

Sergio Odriozola, managing director of Spanish clothing brand Mango, said major brands must work together in order for H&M’s proposal to be effective.

“It should not be just one brand asking for higher wages, but several major brands doing so at the same time,” he said in an email. “On the other hand, together with higher salaries, maybe the productivity [of workers] should also be increased.”

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