Minimum wage to be increased by five percent
July 22, 2011, 11:52 pm TWN
TAIPEI -- The government decided Thursday to raise the monthly minimum wage by slightly more than 5 percent, a move expected to anger local businesses and disappoint labor advocates at the same time.
The monthly minimum wage will increase to NT$18,780 (US$651.67), 5.03 percent from the current NT$17,880, the Council of Labor Affairs (CLA) said.
The council had indicated a hike of at least 3 percent, but businesses went into the meeting advocating for a lower wage hike.
Five percent also falls far short of the demands of protesters outside the CLA building, who wanted an increase of 31 percent.
Labor and business representatives traded barbs as expected at the meeting.
Prior to the closed-door session Thursday, CLA Minister Wang Ju-hsuan told reporters she hopes representatives from labor and industry groups can reach a consensus on the increase despite their major differences going in.
“It's our responsibility to take care of financially disadvantaged families. We've seen a better economy and we know there must be changes,” said Wang, who had previously indicated a 3-percent hike was possible.
At Thursday's meeting of the CLA's Minimum Wage Review Committee, 21 committee members, including seven labor representatives, seven employer representatives, four scholars and three CLA officials, were tasked with finding agreement on how much the minimum wage should be raised.
Prior to the meeting's start, the two sides fired opening salvos that foreshadowed a tough negotiation ahead.
Tsai Sui of the Chinese National Federation of Industries (CNFI), who represents businesses, preempted the meeting by saying he is supportive of a “gradual” increase, instead of a 3-percent hike.
“The increase of 3 percent in minimum wage would add an additional NT$28.9 billion in costs, and we all know competition would fall if costs jump up,” he said.
He described the labor groups' demand for a 31.4-percent increase as “way too much,” but refused to reveal the amount he has in mind.
Labor groups, on the other hand, argue that Taiwan's labor productivity has been greatly boosted in recent years, which means businesses have reaped the benefits of lower employee production costs, said Hsieh Chuan-chih, chairman of the Taiwan Confederation of Trade Unions (TCTU).
He complained that these profit-minded businesses have not rewarded their workers in return.
“If you increase the monthly minimum wage by only 3 percent, or NT$536, workers get less than NT$20 of additional wage per day,” he said.
In Taiwan, at least 1.4 million people, or about 17 percent of the work force, earn the minimum NT$17,880 per month. The monthly minimum wage stayed flat for 10 years from 1997 to 2006. In 2007, it was raised to NT$17,280 from NT$15,840 — a 9-percent increase.
A second, 3.47-percent boost was implemented in January 2011, placing it at the current level.