Negotiations for the new minimum wage for 2017 are underway in Cambodia

Negotiations for the new minimum wage for 2017 are underway in Cambodia

Following a weekend of talks, garment and footwear unions in Cambodia have agreed to demand US$179.60 as the monthly minimum wage for 2017.

Seventeen unions, including affiliates of the IndustriAll global union, took part in the discussions to determine the new wage demand, which is based on living costs, inflation and social factors.

"I think this number is still not enough yet, but we cannot demand higher than this because of our economic and political situation, and investment is limited," said Ath Thorn, president of IndustriAll affiliate, the Coalition of Cambodian Apparel Workers' Democratic Union.

The unions will take the figure, almost a 30% increase from this year's wage of US$140, to the Labour Ministry on Friday 9 September for negotiations with the government and employers.

Further tripartite meetings on the new minimum wage are scheduled for 12 and 26 September, with a final decision expected in October. Any new minimum wage would take effect from 1 January 2017.

The garment and footwear industry in Cambodia employs more than 630,000 people and is the country's biggest export sector.

Labour rights groups and unions have expressed frustrations that the current $140 wage falls short of the $180 they consider to be a fair minimum wage. Cambodia has suffered spates of mass faintings, which have been linked to malnutrition, high targets and long working hours, as a consequence of low wages.

The International Labour Organization (IL), however, has warned that significant further wage increases will be hard to achieve unless higher prices are paid by retailers and brands.

"Prices for exports to major markets have been largely stagnant in recent years," it says, adding: "If this trend continues, it could have important implications for Cambodian workers' wages and working conditions."

The group says factories have up to now largely been able to offset rising wages by increasing productivity and reducing profits – but warns there is limited scope for improvement here, and that unless investors see a return on their capital "they may reconsider further investments in the Cambodian garment sector." 

Cambodia worker wages threatened by low garment prices