Wage hike for some, job loss for many others

[Lite Beer]

SPECIAL REPORT
Wage hike for some, job loss for many others
Kawintra Jaiseu
The Sunday Nation

BANGKOK: -- Pirach Chaunlakhon, 37, who had been contracted to work for a tambon administrative organisation in Udon Thani's Kumphawapi district for more than two years, suddenly found himself without a job earlier this month. Two of his colleagues also ended up facing the same fate.

"On November 3, the tambon clerk told us that our contracts would not be renewed, as the office was shouldering rising HR costs, which went against Article 35 of the Local Personnel Administration Regulation Act 1999," he said. "The news was so sudden that I didn't know how to prepare and meet my responsibilities, such as paying my two children's school fees or my ailing father's medical bills."

He said he and his colleagues have also not been told whether they would be compensated for the termination.

This news comes in sharp contrast to the time when Pirach and his wife, who also works at the same office, found their combined salaries rise to Bt18,000 a month. Pirach had started off on just Bt4,000 a month.

With their new combined salary, household expenses rose as in addition to their children's school fees and his father's medical expenses, they also had to pay off a bank loan they had taken to invest in a sugarcane plantation, he said.

Similarly, their colleague Pariyut Puttakul, 38, was also hired at the office for Bt4,000 a month even though he just had a Mathayom 6 certificate. He explained that he looked after his mother and his two children. When the minimum daily wage was increased to Bt300 nationwide last year, he was delighted to see his salary rise to Bt9,000, and with this new boost, he decided to take a Bt350,000 bank loan to build a new home and put some money away for his children's future studies.

"I have been working in this office for nearly 10 years now, and did my job to the best of my ability. My work record is untainted. Yet I was told on September 30 that my contract had been terminated. It was so sudden that I don't know how to deal with my debts, my daily expenses or even where I should look for a new job," he said.

These job losses were caused by the several salary increments given to civil servants and general employees, as well as the hike in daily wage to Bt300 a day and the Bt15,000 starting salary of bachelor's degree holders. Local administrative organisations have reportedly had to let go of contract workers, as they try to keep their personnel expenses under 40 per cent of the total budget in accordance with Article 35 of the Local Personnel Administration Regulation Act 1999.

Pipat Worasitthidamrong, president of the Local Administrative Officials' Association of Thailand, explained that though decisions on salary hikes were made by the central administration, local bodies covered the new wages and their budgets were not changed to match the extra expenses.

Hence, he said, many local administrative organisations, especially small ones, found themselves going beyond the 40-per-cent limit.

He was speaking at a forum in Khon Kaen that was held to keep local administrative employees informed about legal procedures, including guidance on compensation for getting laid off and how they can appeal against it. It also suggested possible solutions such as getting together to call for more funds to be allocated to local bodies so they can cover the higher salaries.

Pipat explained that in order to solve the problem of staying within the budget, many officials who had been working for a long time and earned between Bt10,000 and Bt20,000 had to be let go or put on a contract, bringing their earnings down to Bt9,000 with no benefits. He warned that things would become worse in the next three to five years.

"After talking to some people, I learned that several of the employees had been told to resign so they could get re-hired on a temporary basis. Then they were placed under assessment for contract renewal. Some were told to leave their jobs under Article 35," he said.

Pipat said local bodies employed some 190,000 to 220,000 people, and as many as 10,000 of them were let go nationwide on October 1 alone.

On Tuesday, the Cabinet resolved to consider giving civil servants a 4-per-cent wage hike from April 1, 2015, a decision that has left many ordinary government employees wondering if they too might be affected like Pirach or Pariyuth.

Source: http://www.nationmultimedia.com/national/Wage-hike-for-some-job-loss-for-many-others-30248367.html

-- The Nation 2014-11-23

[Suriya4]

Prayuth should drop the minimum 300 baht per day policy. It is no good for thailand at all. All it does was increase inflation and job losses.

[slapout]

If you are going to dictate a salary increase, you need to make provisions for the funds to pay the increase. Inapt adminstration, would seem to discribe the group which took upon themselves the making of this decison and several similar decisions which were more costly..

Politicans do seem to spend /disperse funds before they save for or cover their proposed spending. But it never seems to affect them personally as their pay increase is first order of business while social needs, education, health care, transportion, etc. will be talked about for years, then financed via increased/new taxes, so the monies budgeted can be skimed off by the same politicans.

The whole problem shows how a education/political system has failed a majority of the people no matter their social status nor how much money is thrown at it.

[BritManToo]

Prayuth should drop the minimum 300 baht per day policy. It is no good for thailand at all. All it does was increase inflation and job losses.

Nothing to do with the reds, government workers were already earning more than 300bht/day.

It was government staff wage rises implemented by our beloved leader that caused this problem.

[rametindallas]

It's not like the Yingluck government wasn't warned. Upward pressure on wages caused by entry level workers getting Bt. 300 put pressure on the wages of people who had worked hard and become skilled to earn their Bt. 300. Once the law took effect, skilled workers were making he same money as entry level workers. Any but the blind followers of Thaksin/Yingluck could predict that ALL wages would have to go up to reflect the skill level differential. Now that they are no longer needed to win elections, the charade is being dropped and the true cost to society of the populist scheme of PTP is being manifest. I defy the Red Shirt/PTP apologists to name even one populist scheme by PTP that has benefited the country more than it cost. The chickens are coming home to roost. More disasters, already in the pipeline built by Thaksin/Yingluck/PTP, are to befall Thai people. Beside the tragedy of those whose lives have been negatively affected by those policies, is the fact that non of those who created those cynical, vote-getting policies will suffer any penalty.

[SoFarAndNear]

Prayuth should drop the minimum 300 baht per day policy. It is no good for thailand at all. All it does was increase inflation and job losses.

And then what? 300 baht per day? What is this? A good life? This is not just a minimum wage. This is more like a number which shows how much you need to at least survive in this country. And I am speaking of "survive" not having a "good life"

[noitom]

Thailand -- Hard times a comin'.

[BritManToo]

Prayuth should drop the minimum 300 baht per day policy. It is no good for thailand at all. All it does was increase inflation and job losses.

And then what? 300 baht per day? What is this? A good life? This is not just a minimum wage. This is more like a number which shows how much you need to at least survive in this country. And I am speaking of "survive" not having a "good life"

I believe the average income for rural farm workers (just published) is 27,000bht/year.

That works out at 2,250bht/month or 110bht/day (assuming a 5 day week).

[whybother]

Prayuth should drop the minimum 300 baht per day policy. It is no good for thailand at all. All it does was increase inflation and job losses.

Nothing to do with the reds, government workers were already earning more than 300bht/day.

It was government staff wage rises implemented by our beloved leader that caused this problem.

" When the minimum daily wage was increased to Bt300 nationwide last year, he was delighted to see his salary rise to Bt9,000"

That suggests that they weren't.

[Prbkk]

Of course the country can afford this minimum wage: it is a matter of ensuring that the absurd tax regime that applies in Thailand ( ie, NO tax for some obscenely wealthy individuals and endless opportunities for tax avoidance by mega rich corporations) is policed adequately.

Of course the old guard don't want this. They prefer to continue living high on the hog while the vast majority get by on a pittance.

As usual, it will be those who are the least expensive who get the chop: never management or senior positions in the top-heavy, bloated bureaucracy. Disgraceful.

[chainarong]

The problem you have got with wages is that they are a formed from nowhere, they need to be based on cost of living index and inflation , you need to have yard stick on which to base a pay rise , most country village Thai's live on 10,000 Baht a month , one of my crowd was offered 8,000 Baht a month in Pattaya area for hospital Xray work, anyone here on TV live on 10Thousand Baht a month ???? As for the economy , Thailand is the same as most Western countries and will be effected by word trends , lots of unemployment coming up.

[MexicanFarang]

"they try to keep their personnel expenses under 40 per cent of the total budget"

And the other 60% goes for....?

[Crazy chef 1]

i think the key words are getting or earning...

[whybother]

"they try to keep their personnel expenses under 40 per cent of the total budget"

And the other 60% goes for....?

Computers, stationery, electricity, telephones, etc, etc, etc.

Have you ever worked in a company where their only expense is staff salaries?

[nong38]

Price rises are "up" far more regularly now as the spiral starts its trend, which started in earnest with the 300bts a day idea. To be fair I think Yingluck soon cottoned onto the idea that problems lay ahead, she is after all a "business woman" and the 300bts was just for election winning purposes, but then they got stuck with it and who pays the bill.

Perhaps that is why the VAT to 10% is being talked about?

Certainly productivity and efficeincy did not seem to be a factor, so to pay some other will have to be become redundant, its ok if you are the lucky ones.

Cutbacks, price rises, tax rises on the way, just like in the west and how will the personal debts be serviced?

For tourists who have seen hotel prices also rise may not be back in such numbers, seems like there could be trouble ahead, it will be interesting to see how the powers that be deal with this situation, 4 or 5 years with no wage increases perhaps?

[talisman01]

Over the last three years I have been invited to visit some of these administrative offices at both tambon and provincial level and walking around I noticed numerous staff sitting around "playing" the internet, doing their nails or just loafing around chatting or eating and those that appeared to be working had piles and piles of papers and files on their desk. My impression is that these offices are over staffed anyway so downsizing is probably a good thing and, anyway, as more services are mad e available online even fewer staff will be required in the future.

[Thaddeus]

Of course the country can afford this minimum wage: it is a matter of ensuring that the absurd tax regime that applies in Thailand ( ie, NO tax for some obscenely wealthy individuals and endless opportunities for tax avoidance by mega rich corporations) is policed adequately.

Of course the old guard don't want this. They prefer to continue living high on the hog while the vast majority get by on a pittance.

As usual, it will be those who are the least expensive who get the chop: never management or senior positions in the top-heavy, bloated bureaucracy. Disgraceful.

You can't make the poor rich, by making the rich poor.

[Thaddeus]

Your vote benefits who you are voting for, no one else..

[cmsally]

Over the last three years I have been invited to visit some of these administrative offices at both tambon and provincial level and walking around I noticed numerous staff sitting around "playing" the internet, doing their nails or just loafing around chatting or eating and those that appeared to be working had piles and piles of papers and files on their desk. My impression is that these offices are over staffed anyway so downsizing is probably a good thing and, anyway, as more services are mad e available online even fewer staff will be required in the future.

At least they were there. Seen a couple of people go to govt offices last week only to find staff not there, so they need to return next week and hope they can catch them while they are actually at work.

[casualbiker]

Prayuth should drop the minimum 300 baht per day policy. It is no good for thailand at all. All it does was increase inflation and job losses.

Nothing to do with the reds, government workers were already earning more than 300bht/day.

It was government staff wage rises implemented by our beloved leader that caused this problem.

Did you actually read the OP?

[arthurwait]

Welcome to the world of inflation and unproductive, unskilled, unable to think workers. Only a fool didn't see this coming.

More suicides at the hands of the Shins will be coming.

At least there will be plenty of tax payers money from the increased productivity of the Shins popularist policies to help the situation.

Ok there maybe a tiny bit somewhere........... The virgin islands ?

[Thai at Heart]

Of course the country can afford this minimum wage: it is a matter of ensuring that the absurd tax regime that applies in Thailand ( ie, NO tax for some obscenely wealthy individuals and endless opportunities for tax avoidance by mega rich corporations) is policed adequately.

Of course the old guard don't want this. They prefer to continue living high on the hog while the vast majority get by on a pittance.

As usual, it will be those who are the least expensive who get the chop: never management or senior positions in the top-heavy, bloated bureaucracy. Disgraceful.

You can't make the poor rich, by making the rich poor.

Nice Fox News cliche. Scandavia seems to do just fine.

[Suradit69]

If you are going to dictate a salary increase, you need to make provisions for the funds to pay the increase. Inapt adminstration, would seem to discribe the group which took upon themselves the making of this decison and several similar decisions which were more costly..

Politicans do seem to spend /disperse funds before they save for or cover their proposed spending. But it never seems to affect them personally as their pay increase is first order of business while social needs, education, health care, transportion, etc. will be talked about for years, then financed via increased/new taxes, so the monies budgeted can be skimed off by the same politicans.

The whole problem shows how a education/political system has failed a majority of the people no matter their social status nor how much money is thrown at it.

"The whole problem shows how a education/political system has failed a majority of the people no matter their social status nor how much money is thrown at it."

Presumably this indictment re: education & politics also applies to politicians in the US and Europe where government debt is unsustainable and incurred without any regard to budgetary restraint or a balancing of expenditures against income, essentially destroying rather than propping up their economies? Southern European countries have pretty much imploded as have a number of states and municipalities in the US.

[weegee]

Pipat said local bodies employed some 190,000 to 220,000 people,

Maybe that figure might have something to do with it...and just in a local bodies ?

[Mudcrab]

Of course the country can afford this minimum wage: it is a matter of ensuring that the absurd tax regime that applies in Thailand ( ie, NO tax for some obscenely wealthy individuals and endless opportunities for tax avoidance by mega rich corporations) is policed adequately.

Of course the old guard don't want this. They prefer to continue living high on the hog while the vast majority get by on a pittance.

As usual, it will be those who are the least expensive who get the chop: never management or senior positions in the top-heavy, bloated bureaucracy. Disgraceful.

When the minimum wage rises all wages rise in proportion to keep the relativity.

Perhaps it's time to tax money coming into the country...say 20% on all overseas pensions? Aren't the expats seen as wealthy?? Increase the retirement requirements to 1,600,000 baht from 800,000 all of which will be subject to a lodgement tax.

Be careful what you wish for.

Taxing the rich has never made a poor man wealthy.

[trogers]

Very interesting to find government officials excelling in math and budgeting.

Combined salary of Bt18,000 feeding five mouths plus medical expenses, and still can support a loan for investment.

And the wise do not borrow money to invest. They use their savings.

[metisdead]

Troll posts have been removed as well as the replies.

[pookiki]

What has been missed in the posts on this topic has nothing to do with wages but with budget allocations in the country. Is it only the local administrative bodies that are being impacted by staff salaries or are all departments and ministries being impacted in a similar way? If not, why not?

[welshissan]

Over the last three years I have been invited to visit some of these administrative offices at both tambon and provincial level and walking around I noticed numerous staff sitting around "playing" the internet, doing their nails or just loafing around chatting or eating and those that appeared to be working had piles and piles of papers and files on their desk. My impression is that these offices are over staffed anyway so downsizing is probably a good thing and, anyway, as more services are mad e available online even fewer staff will be required in the future.

At least they were there. Seen a couple of people go to govt offices last week only to find staff not there, so they need to return next week and hope they can catch them while they are actually at work.

I had this problem in Satuke the other week. I went to collect my yellow house book on a Friday but was told that the only one capable(?) of doing this work was out watching the boat races !

6 people in the office, none working, just playing games or chatting.

I was told to come back next Wednesday, I asked what was wrong with Monday or Tuesday ?

Sorry we have to catch up on this weeks work first !!!

[trogers]

Over the last three years I have been invited to visit some of these administrative offices at both tambon and provincial level and walking around I noticed numerous staff sitting around "playing" the internet, doing their nails or just loafing around chatting or eating and those that appeared to be working had piles and piles of papers and files on their desk. My impression is that these offices are over staffed anyway so downsizing is probably a good thing and, anyway, as more services are mad e available online even fewer staff will be required in the future.

At least they were there. Seen a couple of people go to govt offices last week only to find staff not there, so they need to return next week and hope they can catch them while they are actually at work.

I had this problem in Satuke the other week. I went to collect my yellow house book on a Friday but was told that the only one capable(?) of doing this work was out watching the boat races !

6 people in the office, none working, just playing games or chatting.

I was told to come back next Wednesday, I asked what was wrong with Monday or Tuesday ?

Sorry we have to catch up on this weeks work first !!!

A reality to the classic story on changing a light bulb. One to hold the bulb and the other four to lift the ladder up and walk around.