By Joshua Carroll
YANGON, Myanmar
Myanmar has for the first time set a national minimum wage following two years of embittered negotiations that saw garment factory owners threaten to close if the wage was set too high.
Employers will have to pay at least 3,600 Kyats, roughly $2.80, to workers for an eight-hour day from Sept. 1, the Myanmar Times reported Monday.
Companies employing fewer than 15 people will be exempt from the new law, which has been supported by international brands including Gap Inc. The company outsources production of its clothes to two South Korean factories in Myanmar.
Factory owners have responded to the new law, announced in state media over the weekend, by laying off workers, Ko Nay Linn Aung of the All Myanmar Workers Union Network told the Myanmar Times.
He said “hundreds” have already been fired in Hlaing Tharyar, a township in the commercial capital Yangon that is home to an industrial zone.
The report added that rules regulating compensation for workers who get laid off were recently changed to allow employers to sack people with less than six months at the company without paying them a severance package.
“It’s convenient timing… employers can now fire the workers without having to use much money,” U Htay, a lawyer representing factory workers, told the newspaper.
Myanmar’s garment industry was severely weakened by decades of western sanctions that targeted the former military junta. Since 2011, most sanctions have been lifted in response to economic and political reforms led by President Thein Sein’s semi-civilian government.
