The minimum wage matters in Myanmar. And there are serious concerns that the level may drop due to the current economic crisis prompted by the military coup.
Under the current labour law, the minimum wage for a basic worker is set at 4,800 kyat per day. The law was last amended in 2018 and requires the minimum wage to be changed every two years. But the wage rate was not amended in 2020 under the National League for Democracy (NLD) civilian government, supposedly due to the disruption of the COVID-19 pandemic.
Following the cautious opening of the door to the world under the Thein Sein regime, efforts were made to put Myanmar in line with the international community when it came to labour laws and regulations. The 2013 minimum wage law was enacted on March 22, 2013 and promulgated on July 12. In 2015. The wage was set at 3,600 kyat for eight hours of work per day, and in 2018, it was revised to 4,800 kyat.
However, since the February 2021 military coup, factory workers have suffered and their wages have been affected.
Wages have been reduced from 4,800 kyat to 3,600 kyat following the directive of Yangon Division industry officials, the region where most of the factories and workshops are located.
Factories may be poised to implement the reduction.
The message has leaked out that the wage rate will drop to 3,600 kyat due to the outflow of foreign investment and the current political situation. This news originated from a factory in the Myasein Yaung industrial zone, Hlaing Thar Yar township, Yangon Division, a president of a workers union told Mizzima. The factory issued an official notice letter stating that the change was to start on January 1, 2022.
Most of the workers said that the factories in Shwe Pyi Thar and Shwe Lin Ban industrial zones were also instructed to change if other factories changed the wages.
At the moment, the payment has not been changed to 3,600 kyats, but the employers are watching each other and the results will be out in January.
Given the news and the controversy, workers at several factories came and asked their union representatives, an officer from the Federation of General Workers Myanmar (FGWM) said.
CMP factory workers in the key economic development sectors of the country are paid only 600 kyat per hour. If it is adjusted to 3,600 kyat for eight hours of work per day, workers will only get 450 kyat per hour.
At a time when commodity prices are soaring, it is not easy to earn enough to support a family on such a low income.
Given the threat to workers’ income, the implementation of a cut in wages could spark a revolt, in an industry with troubled worker-employer relations.
It therefore behoves all parties - workers, employers and the Ministry of Labour, Immigration and Population – to hold a tripartite meeting to discuss the issue.
Maung Maung Than, the military-appointed director-general of the Labour Directorate, announced on December 27 that when adjusting the minimum wages, it is not usual to reduce the declared fee, but normally one would raise it, and the current 4,800 kyat is officially valid.
One workers’ union president, speaking under condition of anonymity, said that he did not believe the announcements made by the Military Council concerning social security fees made in July 2021.
The day after the National Unity Government (NUG) announced in July that it was granting workers welfare benefits and allowing exemption for social security fees, the military council owned Myawaddy news agency announced a six-month moratorium for social security fees during the Covid period.
However, when it comes to the payroll, social security fees are always cut the same as before. “When I asked the relevant authorities, they said that it was just a news announcement, you have to pay the same as before, and thus we cannot trust their announcements," he added.
As workers head into the new year, attention will be focused on whether a drop in wages is about to come to pass.
