Employers, Workers Far Apart in Minimum Wage Negotiations

By Nobel Zaw 28 April 2015

RANGOON — Tripartite discussions between Burma’s Ministry of Labor, workers’ representatives and factory owners in recent days have revealed wide differences of opinion about the country’s future minimum wage, which will be determined in the next few months.

Sai Khaing Myo Tun, a workers’ representative on the tripartite National Committee on Minimum Wage, said workers’ organizations are demanding about 4,000 kyats (about US$4) for an 8-hour work day, excluding welfare benefits, overtime and bonus payments. The workers representatives set out their demands during a meeting with Minister for Labor, Employment and Social Security Aye Myint on Sunday.

Dozens of employers met with the minister on Saturday and garment factory owners, one of the largest sources of industrial employment in Burma, demanded a 1,500 kyat minimum wage for an 8-hour work day, according to a Rangoon-based factory owner, who asked not be named.

He said garment factory employers had demanded the 1,500 kyat wage due to the labor-intense production process in the sector, adding that the owners of other type of factories, such as wood-processing factories, were willing to accept a minimum wage of 3,000 kyats per day.

Sai Khaing Myo Tun said workers’ organizations were demanding a minimum wage on par with that of civil servants, who saw a modest pay rise in recent months—a government measure, he said, that was pushing up to cost of living for workers.

“The workers will only be comfortable with over 4,000 kyats per day because civil servants get at least 120,000 kyats per month…. If the salary is less than the civil servants, [workers’] living conditions will be difficult,” he said. “A salary of 1,500 kyats per day is not suitable and cannot have a good effect on the country.”

The Asian Development Bank said last month that inflation for this year is projected at 8.4 percent; Burma’s economy is expected to grow at 8.3 percent.

On May Day, about 2,000 workers plan to hold a march to call for a 5,600 kyats minimum wage and they have asked authorities for permission to walk from Rangoon’s Insein Township to Mayangon Township and on to Kamayut Township, according to Hla Hla, a member of the National Network for Workers Unions.

“We have demanded 5,600 kyats since 2013 but it can be negotiated,” she said, adding that 4,000-4,500 kyats would be the bare daily minimum income required by workers due to the rising costs of living.

Burma’s former military regime repressed labor movements and industrial relations were undeveloped; as a result the country still lacks a set minimum wage.

Currently, average monthly wages in Burma are among the lowest in the region, with most workers making between 30,000-40,000 kyats ($30-40) per month, less than half of what laborers in Cambodia or Bangladesh earn.

The low wages force Burmese workers to work grueling schedules of up to 11 hours per day and six days per week, according to a 2013 labor rights report, in order to earn overtime and bonus payments that increase their monthly income to about 70,000-80,000 kyats.

In 2013, President Thein Sein’s nominally-civilian government passed the Minimum Wage Law and established a tripartite National Committee on Minimum Wage tasked with determining an appropriate wage level through research and negotiations.

This process will come to a conclusion “within one or two months” through Ministry of Labor-led negotiations between employers and labor representatives, state media reported on Sunday.

Steve Marshall, the International Labor Organization’s liaison officer in Burma, said in a recent interview that the process should result in a minimum income standard that “supports the most vulnerable in society in terms of their basic living standards, but also supports the growth of the economy and that the country remains competitive.”

Additional reporting by May Sit Paing.