10 regions of Thailand to use new minimum wage calculation

The tripartite Wage Committee has given the green light, by a close vote of 7 to 5, to a new method for setting minimum wages.

Ten key regions, including the bustling metropolis of Bangkok, are set to pioneer this transformative change from April onwards.

The freshly endorsed formula marks a paradigm shift, incorporating elements such as labour productivity, contribution to production, inflation rates, and economic conditions into its calculation. Labour Permanent Secretary, Pairoj Chotikasathien, announced the bold move yesterday, asserting that it’s a pivotal step towards ensuring fair compensation across the board.

According to Pairoj, the blueprint for this wage revolution will be dispatched to all provinces, initiating a crucial phase of consultation with both entrepreneurs and labour representatives. Among the initial ten regions set to benefit are bustling urban hubs like Phuket and Chiang Mai, along with industrial powerhouses such as Rayong and Chon Buri.

However, uncertainties loom over the exact figures, as Pairoj refrained from confirming whether the minimum wage will hit the anticipated 400 baht mark. He stressed that regional economic dynamics and job diversity would play a pivotal role in determining the final figures, reported Thai PBS World.

Atthayut Leeyavanich, representing employers on the Wage Committee, voiced concerns from small and medium-sized enterprises (SMEs), expressing hopes for judicious adjustments that won’t strain their operations.

In contrast, a labour representative on the committee hailed the new formula as equitable and sensible. Yet, even he remained in the dark about the extent of the impending wage surge, underscoring the intrigue surrounding this transformative policy shift.

In related news, rising labour costs in the tourism sector are outpacing revenue growth, resulting in increased hotel expenses, as revealed by hospitality market analyst STR. Jesper Palmqvist, senior director for Asia-Pacific at STR, warned that the only risk for hotels this year is maintaining cost controls in light of the extraordinary growth of labour costs and room rates.