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According to Act No. 303 (“Prakas 303”) on the determination of minimum wages for employees in the textile, clothing and footwear industries published by the Ministry of Labour and Vocational Training (“MLVT”), as of January 1, 2021, The minimum wages for workers in the textile, clothing and footwear industries are as follows:
Ordinary worker: US$192 per month.
Probationary workers: US$187 per month.
Other benefits that these workers are entitled to include: a monthly transportation or accommodation allowance compensation of 7 US dollars, a monthly attendance bonus of 10 US dollars, a food allowance of 0.5 US dollars a day for overtime workers (or one free meal per day); Employees in the eleventh year can receive rewards ranging from US$2 to US$11 per month.
Prakas303 also stipulates the lowest wages for piece rate workers. For these workers, the wages are determined by their piece rate. If the wages brought by this kind of production are higher than the lowest wages, the workers will be entitled to higher wages. However, if the remuneration from production is lower than the minimum wage, the employer must increase the worker’s wages so that the total wage is at least equal to the minimum wage (US$192 for regular workers and US$187 for probationary workers).
It is understood that since 2013, the Royal Government of Cambodia has implemented a salary increase policy for clothing and footwear workers every year. The salary adjustments over the years are as follows:
In 2013, the minimum wage of clothing and footwear workers was raised from US$61 to US$80, an increase of 19USD;
Increased to 100 USD in 2014, up 20 USD;
Increased to 128 USD in 2015, up 28 USD;
Increased to 140 USD in 2016, up 12 USD;
In 2017, it was increased to 153 U.S. dollars, an increase of 13 USD;
Increased to 170 USD in 2018, up 17 USD;
Increased to 182 USD in 2019, up 12 USD;
Increased to 190 US dollars in 2020, up 8 USD.
In general, although the salary increase in Cambodia in 2021 has been significantly reduced compared with previous years, for labor-intensive industries, the salary increase in successive years will still put a certain pressure on business operations. It is recommended that textile and garment enterprises that set up factories in Cambodia be early Prepare to deal with the business challenges brought about by rising wages.
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