Thai chamber opposes proposed minimum wage increaseLegacy

The Thai Chamber of Commerce (TCC) is in dispute with the government over its proposal to increase the minimum daily wage to 400 baht for workers all over the country. The proposed wage increment is expected to take effect in October.

Speaking on the issue, Poj Aramwattananont, Vice-President of the TCC and the Board of Trade of Thailand, painted the proposed raise as a double-edged sword. He noted that while some businesses might be able to afford the increased wages, others could face negative impacts.

Poj pointed out that the proposed hike could cause issues in provinces that aren’t prepared for such a change, such as Phrae and Nan.

These areas have few industrial plants and hotels to accommodate tourists. He recommended that wage hikes should be applied to industries with a higher proportion of Thai workers than immigrant workers to prevent money from flowing out of the country.

“The hikes will also impose financial burdens on business operators. This is a major issue, and I will discuss it with the Labour Ministry,”

He further revealed plans for the TCC’s provincial chapters to hold a press conference tomorrow, May 8, to oppose the plan. The event will feature representatives from around 30 associations, including the construction, hospitality, retail and wholesale, logistics, and rubber sectors.

Businesses recovery

Sangchai Theerakulvanich, President of the Federation of Thai SMEs, also expressed his disapproval of the proposed hike. He explained that small and medium-sized enterprises (SMEs) are still grappling with recovery from the effects of geopolitical tensions on the global economy.

“Wage hikes will also hurt about 2.7 million micro-enterprises, which employ about 5.5 million workers.”

The proposed hike to 400 baht a day was approved by the tripartite committee on March 26 and took effect in parts of 10 provinces on April 13. The increase applies to tourism-related businesses and four-star hotels with at least 50 employees.

However, the move has faced criticism for only benefiting workers in the tourism sectors of select regions, thereby discriminating against other types of businesses nationwide.

Labour Minister Phiphat Ratchakitprakarn has indicated that the 400 baht minimum daily wage promised for workers nationwide will likely be realised on October 1. However, the final decision still lies with the wage committee.

Prime Minister Srettha Thavisin also advocated for minimum wage increases for other areas and business types, although businesses have expressed concerns that this would make the country less competitive.

The daily minimum wage for all Thai workers was increased on January 1, with the new rates varying by province, from 330 to 370 baht. These increases ranged from 2 to 16 baht, or an average of 2.37%, reported Bangkok Post.

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Author: Mitch Connor