Home / Knowledge / News / Apparel/Garments / Early minimum wage hike creates controversy
Early minimum wage hike creates controversy
05
Aug '11
A controversy has been created amongst business circles, including garment manufacturers, and state agencies in Vietnam following the Ministry of Labour, Invalids and Social Affairs' suggestion to raise the minimum wage three months before schedule.

The Ministry has proposed to make the new wages effective from October 1 this year instead of January 1, 2012 as scheduled earlier. However, adjustments in different working zones would follow subsequently.

The new wage would apply to both domestic businesses as well as to those operating in the country with foreign investment.

The new minimum wage would vary in the range of VND 1.4 million or US$ 68 per month in underdeveloped areas to VND 1.9 million or US$ 92 per month in urban localities, i.e. a rise of 27.2 percent and 40.7 percent respectively from existing minimum wage levels.

Wage hike has remained a key demand at several strikes that took place in the Vietnam during last year. In fact, the number of strikes almost doubled during the period than usual.

It has been pointed out that over 250 firms operating with foreign investment in the country paid only the minimum wages as stipulated by the Government, which compelled the workers to work overtime.

However, the decision to grant pre-scheduled wage hike has raised the concern of the garment manufacturers regarding the additional cost of production.

Entrepreneurs believe that in view of existing financial unsteadiness, it would not be fair for the Government to hike the minimum wages.

Pressure of wage hike coupled with mounting cost of raw materials for production and high interest rates are seen to endanger existence of the small and medium scale enterprises.

Also, alongside the rise in monthly wages the cost of insurance for the employee's would also go up. Hence, the wage hike is expected to compel the enterprises to cut down on production by reducing the number of workers or to hike the prices of their goods and services.

Experts believe that while raising the salary it would be essential to balance the interests of the workers as well as the enterprises.

Meanwhile, the Government has urged the businesses to extend their support to its proposal of raising the minimum wage so as to avert any strikes taking place during the year on salary issues, while also ensuring that workers are able to afford good living conditions in the midst of high inflation.

Fibre2fashion News Desk - India

Must ReadView All

Courtesy: Walmart

Apparel/Garments | On 23rd Mar 2017

Walmart acquires ModCloth

Walmart has acquired the assets and operations of ModCloth, one of...

Textiles | On 23rd Mar 2017

SIMA advises mills to avoid panic buying of cotton

The Southern India Mills' Association (SIMA) is advising mills to...

Apparel/Garments | On 23rd Mar 2017

Tulip Retail, True Fit personalise in-store shopping

Tulip Retail, a mobile application platform built exclusively for...

Interviews View All

Stefan Warnaar
Peak to Plateau

People are willing to pay for quality and performance

DK Sharma
Velocity Apparelz

We constantly communicate with employees at all levels

Binoy Ravjani
Hero's Fashion

‘One of the recent trends in hand block printing is the indigo process,...

Ashok Desai
Bombay Textile Research Association

Bombay Textile Research Association (BTRA) is a leading name in textile...

Johan Berlin
InvestKonsult Sweden AB

Investkonsult Sweden AB has been buying and selling second-hand textile...

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Sonam & Paras Modi
SVA

Sonam and Paras Modi's Sva Couture is synonymous with head-turning...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

news category


Related Categories:
March 2017

March 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


eNEWS
Insights
Subscribe today and get the latest News update in your mail box.
Advanced Search