Employment & Labour Law

Factories begin New Wage Plan

Date: 18 January 2019; Type: Legal News; Source: Phnom Penh Post

The Ministry of Labour and Vocational Training issued an announcement on Wednesday indicating that 81 per cent of garment and footwear factories have implemented the government’s new requirement to pay workers’ wages twice a month.

“As of January 16, 2019, the Ministry of Labour and Vocational Training has checked that salaries are being paid twice a month and it found that 81 per cent of factories and enterprises are [following] this policy,” the statement read.

Ministry spokesman Heng Sour labelled the results “acceptable” but said that the government would not allow factories to continue not paying their workers twice monthly in line with the new law.

“If the ministry receives complaints from workers at factories and enterprises that have not implemented the policy, the ministry will fine them and press them to implement Prakas number 442 [the policy],” he said.

Prakas 442, approved on September 21 last year, states that as of January this year garment and shoe factories must pay workers’ wages in two instalments each month. The first payment is to be made between the 16th and 19th of the month and the second one between the 1st and 7th of the month.

The policy states that the first payroll must be equal to 50 per cent of the employee’s net wages per month. While the second payroll must be equal to the remaining wages, including other benefits that employees receive each month. The ministry said it will fine any company found not to be following this procedure.

The policy is intended to ease the financial strain low paid workers feel when they are waiting for their next paycheck at the end of each month.

Quality Factory Administration Manager Chab Sophorn said his factory is making efforts to follow Prakas 442 and is preparing to pay the workers’ first wages by Saturday.

“My factory and others are preparing to follow the ministry’s Prakas. But there is still some confusion as well because the ministry’s announcement on January 16 said 50 per cent of salary, but we are unclear whether this refers to 50 per cent of the minimum wage or the daily wage of workers over two weeks."

“For workers who have worked for three to five days, the factory will find it difficult to pay 50 per cent of the salary for them. However, the factory will try to find a solution,” he said.

Thul Thy, a garment worker at Trapaing Thloeng market in Phnom Penh, said her factory announced that her first wages will be paid on Saturday.

“The factory informed us that the first payment will be on the 19th and the second one will be on the 7th."

“For me, such a quick payment of salary is better because it will ease our financial difficulty as we won’t have to wait until the end of the month,” she said.

Nem Saran, an officer at the Free Trade Union of Workers of the Kingdom of Cambodia based in Kampong Chhnang province, told The Post that Kampong Chhnang has eight factories, two of them were footwear factories, while the remaining were garment factories.

He said all eight factories followed the ministry’s guidance and pay their workers twice per month, adding that “most garments workers are happy to have their salary paid two times per month.”

Garment Manufacturers Association of Cambodia (GMAC) President Ken Loo told The Post on Thursday that most factories that are members of GMAC issue their workers’ salaries two times per month.

“Most of our members followed the ministry’s order by paying their workers twice per month. Only a small number of factories have not follow the order. GMAC will ask them to follow the law,” he said.

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