Laos raises minimum wage for workers
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The Lao Government has decided to raise the monthly minimum wage from LAK1.2 million (nearly US$70) to LAK1.3 million starting May 1 to ease workers’ difficulties amid soaring inflation and economic uncertainties.
The decision was made at the Lao Government’s meeting held on April 25 – 26 under the chair of Prime Minister Sonexay Siphandone.
In 2022, as workers’ lives were hit hard by soaring inflation, the Lao Federation of Trade Unions Central Committee proposed increasing the monthly minimum wage to 1.5 million LAK.
However, the Lao National Chamber of Commerce and Industry opposed it, saying that the wage hike would negatively impact enterprises that were also struggling with difficulties.
Aside from the minimum wage rise, PM Sonexay Siphandone told the Ministry of Labour and Social Welfare to work with related sectors to consider how the increase is relevant to the current economic situation.
He also asked ministries and sectors to conduct an in-depth study on wage hikes and report results to the Government in the third quarter of this year.
Questions & Answers
Q.When does the new minimum wage come into effect?
When does the new minimum wage come into effect?
The new monthly minimum wage of LAK1.3 million will start from May 1. This decision was made at a government meeting held on April 25-26.
Q.What was the previous minimum wage before this increase?
What was the previous minimum wage before this increase?
Before the current raise, the monthly minimum wage in Laos was LAK1.2 million, which was nearly US$70. It has been increased by LAK100,000.
Q.Why did the Lao Federation of Trade Unions' earlier proposal not pass?
Why did the Lao Federation of Trade Unions' earlier proposal not pass?
The Lao Federation of Trade Unions had proposed a monthly minimum wage of LAK1.5 million in 2022. However, the Lao National Chamber of Commerce and Industry opposed this, citing potential negative impacts on struggling businesses.
Q.What further action is the government taking regarding wages?
What further action is the government taking regarding wages?
The Prime Minister has instructed the Ministry of Labour and Social Welfare to study the relevance of the increase to the economic situation. Other ministries are also to conduct in-depth studies on wage hikes and report by the third quarter.
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