Cambodia news publication The Phnom Penh Post has reported the National Council for Minimum Wage’s (NCMW) decision came after 20 separate negotiations failed to find a unanimous agreement. Government and employer representatives were in favour of the $202 figure, while worker’s unions had demanded $213.
The new minimum wage is said to take effect in January 2024, with full-time workers receiving $204 and those in a probationary period earning $202 per month.
When factoring in other bonuses and allowances such as an extra $10 per month for regular attendance and an extra $7 per month for transportation and rent, each worker is expected to earn between $221 and $232 per month, according to The Phnom Penh Post.
The Phnom Penh Post quotes Cambodia Prime Minister Hun Manet as stating: “I have followed the minimum wage discussions closely from the start. The improvement of the livelihoods of the people, including garment workers, is the highest priority of the government. Based on practical allowances, I decided to add $2 to the result of the vote. Therefore, the new 2024 minimum wage is $204 a month.”
The newly established minimum wage represents an increase from the $200 set in 2023, a figure which also included a $2 contribution from the then Prime Minister Hun Sen.
The news publication explains Manet has instructed the Ministry of Labour and Vocational Training to inform workers about the new minimum wage. Plus, he is urging all state institutions to examine measures that could reduce the cost of living for workers.
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“I will lead a November meeting with the private sector to fine-tune the investment climate and business conduct in Cambodia to increase competition and attract investment capital, which would create new jobs for people,” he adds.
A report published this month titled ‘Stitched under Strain: Long term wage loss across the Cambodian garment industry,’ claims the global fashion industry was putting profits above the rights of its Cambodian garment workers with at least a quarter of surveyed workers reporting a 25% decrease in monthly take-home pay since 2020. This was despite a legal minimum wage increase of $10 between 2020 and 2023.
This came after Nike, alongside its supplier Ramatex Group, was originally called on by non-profits Human Rights Watch and the Clean Clothes Campaign in July to pay $1.4m in severance to its Cambodian garment workers.
Cambodia wage increase receives mixed reviews
The Phnom Penh Post reports that union representative Kim Chan Samnang and other members of the union “felt okay with the results”, noting that it was determined following an evaluation of seven indicators, with particular consideration given to competition from neighbouring countries.
Ken Loo, secretary general of the Garment Manufacturers Association in Cambodia (GMAC) told Just Style in September 2022, that the country’s garment industry still held its competitive advantages over other regional outsourcing centres, despite the challenges it faced at the time with its weak backward linkages and pressure to increase wages.
However, some workers, like Vich Seng Van, who works at a factory in Cheung Prey district of Kampong Cham province, felt the wage increase was insufficient. She had hoped for a higher increase and told The Phnom Penh Post: “An increase of less than $10 is small because it is only based on the minimum wage, without taking into account the overtime work we do to earn more income. Also, the price of many goods is increasing.”
The news publication adds that she accepts the figure because she believes the government is prioritising employee wellbeing.