Cambodian government has worked hard to solve wage dispute
08/07/2013
There have been reports of industrial action and even violence in the months since a new minimum wage of $80 per month came into force on May 1. At the end of June, Cambodia’s prime minister, Hun Sen, warned that big-name garment and footwear brands could quickly take their business to Myanmar, India, Laos or Bangladesh if the situation does not settle down.
Recent reports have shown that the government was closely involved in negotiations in the build-up to the May 1 changes. The previous minimum wage was $61 per month. The new rate originally looked like reaching only $73, but the government asked factory owners to increase it to $75 and to add another $5 per month to pay for workers’ healthcare needs. The new agreement also includes a commitment to annual reviews.
Cambodia’s garment industry is its biggest earner of foreign exchange. It has more than 300 factories, employing more than 330,000 workers, of whom more than 90% are women. In 2012, garment and textile exports earned $4.6 billion for the Cambodian economy, an increase of 8% compared to the year before.
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