Sat, Jul 21, 2012 - Page 1 News List

No decision on minimum wage: CLA

SALARY SALVO:A report saying the government plans to raise the minimum wage sparked an objection from corporations coping with falling orders and a weak economy

By Crystal Hsu  /  Staff reporter, with CNA

The Council of Labor Affairs (CLA) has not yet decided whether to raise the minimum wage, or how high such a raise might be, a council official said yesterday.

Chen Huei-ling (陳慧玲), head of the council’s Department of Labor Standards, said the issue would be discussed at a Basic Wage Screening Committee meeting on Aug. 2.

Chen’s comments came in response to media reports yesterday that the council had settled on a plan to raise the minimum wage this year.

The Chinese-language United Daily News reported that the minimum hourly wage would be raised by 11 percent from NT$103 (US$3.43) to NT$115 this year, citing Council of Labor Affairs Minister Jennifer Wang (王如玄).

Wang reportedly said the scale of adjustment for the minimum monthly wage would not be as high as that for the hourly wage. The minimum wage now stands at NT$18,780 per month, up 5 percent from NT$17,880 last year.

She also reportedly said the plan would not be finalized unless a wage-screening committee approves it.

Under the Labor Standards Act (勞動基準法), a proposal to adjust the minimum wage must be presented by the council’s Basic Wage Screening Committee and verified by the Executive Yuan. The committee is comprised of representatives from the labor, management, academic and government sectors.

The Chinese National Federation of Industries (全國工業總會) yesterday voiced its objection to plans to raise the minimum wage next year, saying the move would put an extra burden on firms that are struggling to cope with falling orders amid a weak economy.

“We don’t see any reason for a minimum wage increase next year because Europe’s debt problems have weakened the nation’s export-oriented economy,” the group said in a statement.

A 3 percent upward adjustment in the minimum wage would create an extra NT$13.12 billion in labor costs a year, the federation said, adding that the figure did not include overtime and other compensation.

An increase of 5 percent would raise labor costs by NT$19.84 billion a year, it said.

If the government must adjust hourly pay, the increase should be capped at 7.28 percent, the federation said.

Companies would have to shrink their payrolls, driving up unemployment for people earning minimum wage, who tend to be unskilled workers, it said.

Firms have already had to cut costs to withstand worsening global economic conditions and a minimum wage increase would add to the burden, the federation said.

Sapping export orders are squeezing earnings, a plight that is compounded by the government’s oil and electricity price increases, the federation said.

Export orders, an indicator of actual shipments one to two months ahead, fell 2.62 percent last month from a year earlier, contracting for the fourth straight month amid sluggish demand for consumer electronics products, the Ministry of Economic Affairs said yesterday.

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