The
Việt Nam Textile and
Apparel Association (VITAS) yesterday proposed that the regional minimum wage
(covering four regions in the country) not be increased next year.A 6.5 per
cent increase in the regional minimum wage for 2018 had been decided in August
this year by the National Wage Council and submitted to the Government for
final approval.Amounting to an increase of VNĐ180,000-230,000 (US$8-10) a
month, it was said to be the lowest wage increase ever in the country.
However,
at a conference on the effects of wage and social insurance policies on textile
enterprises in Hà Nội
yesterday, VITAS proposed that there be no increase in the minimum wage in the
next one or two years, since several enterprises are already struggling with
wage increases in the last decade.In the 2007-2017 period, minimum wage in
domestic enterprises increased by 21.8 per cent, leading many enterprises
to reduce workers’ bonuses every year and use machines instead of labourers,
said VITAS.
Trương Văn Cẩm,
vice chairman of VITAS, said that increasing the regional minimum wage does not
ensure increases in workers’ living standards because “wage increases often
drag along increases in commodity prices and increases in the cost-of-living.“Moreover,
constantly increasing minimum wage reduces competition and shifts the labour
structure, preventing enterprises from expanding production and robbing
labourers of job opportunities,” he said.Social insurance premiums also
increase when minimum wages increase. For the Hưng Yên Garments Corporation with 15,000 workers, the increase
in social insurance premiums would go up by VNĐ18 billion ($792,000) per year,
said Chairman Nguyễn Xuân
Dương.
“Five out of our 14 member enterprises are already struggling. It will be hard
for us to stay in business if the minimum wage keeps increasing.” Dương said.
“In fact, several textile enterprises in our Hưng Yên Province
have closed down.”Apart from the minimum wage, VITAS has also proposed
that adjustments be made soon to address what it seems as drawbacks in Labour
Code 2012, which covers overtime, severance pay, unemployment benefits, health
and occupational safety and labour discipline.
Source: Vietnam News, Vietnam Thursday, 11 January 2018