Minimum Wage Plan: Where's The Tripartite Committee?: Thai Talk

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THAI TALK

Minimum wage plan: Where's the tripartite committee?

By Suthichai Yoon

The Nation

If Deputy Premier Kittiratt na Ranong had to "go down on my knees and beg" the private sector to comply with the government's pledge to pay the proposed Bt300 daily minimum wage to workers, it means there is still a long way before the Pheu Thai Party's election pledge on this issue can be fulfilled.

As soon as the Labour Ministry said last week that the plan would be implemented in phases, starting with a "pilot project" for seven provinces, the labour unions came out to say that that wasn't what the election promise had stipulated in the first place. They want the Bt300 minimum wage scheme to be applied to "all provinces throughout the country" without exception.

The seven provinces are Bangkok and five outlying provinces of Samut Sakhon, Pathum Thani, Nakhon Pathom, Nonthaburi, Samut Prakan, plus Phuket.

A well-known labour academic, Lae Dilokvihdyarat, chimed in: "If it's a pilot project, does it mean that if the experiment with the first seven provinces doesn't work out, then the rest of the country won't get the Bt300 wage? It doesn't sound like it's going to go down too well with the labour leaders."

This will become a classic case for all politicians. The lesson learned should be: Never ever offer a specific pledge that could return to haunt you. A labour union leader put it matter-of-factly: "It was because most workers believed Pheu Thai could deliver on the minimum wage pledge that they all cast their votes for the party. Now it's time to show that it wasn't just an empty political gimmick."

The seven provinces that come under the first test will have their minimum wages raised by about 40 per cent. It's not clear by what yardstick the Labour Ministry will consider the "pilot project" a success or failure. But it's clear that the government will still have to be able to persuade the private sector to go along with the plan.

Big conglomerates such as CP and SCG have expressed their readiness to be part of the government's major experiment. But the Federation of Thai Industries (FTI), which represents a significant part of the private sector, has raised a few reservations, including the concern that small and medium-sized enterprises (SMEs) will stand to suffer the most as a result of the increase in production costs.

The government's initial plan to reduce their tax burden in exchange for compliance has not pacified the struggling companies: because of their negative bottom lines, they haven't had to pay corporate taxes anyway.

The crucial question that the Yingluck government hasn't addressed in its approach, at least in public, is how it will handle the Wages Tripartite Committee, which has had the legal authority to decide minimum wages for many years.

The three parties in the joint committee represent employers, employees and the government. The committee has drawn up at least nine benchmarks on which it decides the minimum wage. The committee has done a reasonably good job so far - as a legitimate balancing force to reach the kind of compromise that's acceptable to all three parties concerned.

With the government announcing its plan to raise the minimum wage to Bt300, is it sending the signal that the tripartite panel will be abolished? If that's the case, the existing law will have to be scrapped - and that requires a legislative process that can't be implemented overnight.

To get rid of the "independent" three-party body on minimum wages could be risky politically, for it means that there won't be a neutral body to act as a buffer for the government in the highly controversial and complicated process of annual negotiations over minimum wages. Is the government ready to remove that buffer and adopt a face-to-face relationship with the country's labour force on all major issues?

I am all for offering better welfare and remuneration - and upgrading skills - for the country's labour force. But for the Pheu Thai Party, that Bt300 minimum wage policy seems to have got stuck, because the guys who drew up the party's campaign slogans aren't the ones who are supposed to implement them now.

The electorate may appreciate that fact, but they aren't supposed to be so understanding as to distinguish between "electioneering techniques" and "election pledges", and then declare: "Let's forget about the promises".

Are they?

-- The Nation 2011-09-08

[Buchholz]

The crucial question that the Yingluck government hasn't addressed in its approach, at least in public, is how it will handle the Wages Tripartite Committee, which has had the legal authority to decide minimum wages for many years.

The three parties in the joint committee represent employers, employees and the government. The committee has drawn up at least nine benchmarks on which it decides the minimum wage. The committee has done a reasonably good job so far - as a legitimate balancing force to reach the kind of compromise that's acceptable to all three parties concerned.

With the government announcing its plan to raise the minimum wage to Bt300, is it sending the signal that the tripartite panel will be abolished? If that's the case, the existing law will have to be scrapped - and that requires a legislative process that can't be implemented overnight.

oops..

[Thai at Heart]

The crucial question that the Yingluck government hasn't addressed in its approach, at least in public, is how it will handle the Wages Tripartite Committee, which has had the legal authority to decide minimum wages for many years.

The three parties in the joint committee represent employers, employees and the government. The committee has drawn up at least nine benchmarks on which it decides the minimum wage. The committee has done a reasonably good job so far - as a legitimate balancing force to reach the kind of compromise that's acceptable to all three parties concerned.

With the government announcing its plan to raise the minimum wage to Bt300, is it sending the signal that the tripartite panel will be abolished? If that's the case, the existing law will have to be scrapped - and that requires a legislative process that can't be implemented overnight.

oops..

Minister of Labour also said minimum wage hike decision has to take into account other stakeholders as well. If it hurts businesses, causing lay-off or leading a business to shut down, it would bring no good for both employees and employers. He, therefore, cannot promise workers that the Committee will raise the minimum wage after the meeting ends.

http://www.mol.go.th/en/anonymouse/news/16070

I can agree with this sentiment whole heartedly other than the issue of "hurting" business. No business is going to agree to vote to put up wages. This is where the role and mandate of the committee has been mis-used over the years. The point of minimum wage legislation is not to insure that companies are not hurt.

[simosiam]

will be increase the minimum wage also for the woman working in night venus like bar beer or for them will be the same shame of 2.000 B- monthly?

[ratcatcher]

will be increase the minimum wage also for the woman working in night venus like bar beer or for them will be the same shame of 2.000 B- monthly?

I'm sure you are familiar with the sort of money bar "hostesses"and their colleagues in Thailand's Hospitality industry are making, although it is low season at the moment. :-)