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September 26, 2017

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Paying the minimum won't lead workers to give their maximum

The Council of Labor Affairs (CLA) is set to review the current minimum wage on Aug. 2. According to the CLA, the basic plan for the adjustment is that the hourly wage will be raised to NT$115 — which was the policy proposed by the president during his election campaign — while the monthly wage will only be mildly adjusted. If this adjustment takes place, the link between monthly wage and hourly wage will be broken.

Commerce and industry representatives, as always, have voiced their opposition to the minimum wage hike. They argue that it is not a good time to adjust the minimum wage since the current economic condition is dire. The newly released economic forecast of the Academia Sinica indicates that economic growth this year could be as low as 1.94 percent. Higher minimum wages will increase the personnel costs of industries and businesses, making it more difficult for them to survive.

These representatives also argue that the minimum wage should not be applied to foreign workers. According to them, some NT$7.5 billion out of the NT$13.1 billion increase of the personnel cost resulting from higher minimum wages will be directly due to foreign workers, and domestic workers will benefit little from the policy.

The minimum wage is adjusted every year, and the purpose is for workers to have a share of the nation's economic growth and to guarantee that their income will not be eaten away by inflation. Each year a committee is held in the third quarter to review the wage level, and the committee makes adjustments based on the economic growth and inflation of the previous year.

Therefore, the argument that low economic growth is not conducive to raising the minimum wage can only be used next year, but not this year. The committee this year is only to review how large a share of 2011 economic growth workers should have.

Despite the concern of being recognized as a country discriminating against other citizens, it is also not fair for workers to do the same job while collecting different salaries. Company owners should bear in mind that the profits they earn are also due, in part, to the contributions of foreign workers, and thus these workers should also have their share.

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