Why we need a decent living wage?

At a roundtable conference in Petaling Jaya on Friday, 10 June 2011, where unionists, NGO activists from Korea, Thailand, Philippines, South Korea and Malaysia said that a decent living wage policy would help workers cope with the economic realities of their respective countries in real time.

A decent living wage policy should be the way forward for governments in Malaysia, Indonesia, Thailand, the Philippines and South Korea to give workers better security.

Patricia Hornilla

The Philippine National Wages and Productivity Commission deputy executive director Patricia Hornilla said that a decent living wage has a more holistic approach in addressing workers’ needs compared to a minimum wage. 

“A decent living wage will ensure a worker has funds for savings and investing in social security schemes,” said Hornilla.

“A decent living wage will ensure a worker has funds for savings and investing in social security schemes”

However, Hornilla said it was important that all parties involved in implementing the policy – the government, employers and employees – come to a mutual understanding.

Productivity and increments
She also said that employers should not argue about productivity when it came to addressing the basic needs of their workers.

“Productivity should only be taken into consideration when considering increments,” she said.

She said that the parties could come up with clear criteria on how the wages should be adjusted from time to time. “This will help employers be prepared. It will also deter employees from having unrealistic expectations over their wage adjustments.”

Difference between decent living wage and minimum wage

Bundit Thanachaisethavut

Thailand’s Arom Pongpangan Foundation-Labour Resource Centre director Bundit Thanachaisethavut said that unlike a decent living wage, a minimum wage only served to protect those who were fresh in the workforce for a certain period of time.

"... a minimum wage only served to protect those who were fresh in the workforce for a certain period of time."

“But a decent wage policy takes into consideration cost of living, skills upgrade and sustainability,” said Thanachaisethavut.  However, he said that the new policy could only materialise if the unions were strong.

"... a decent wage policy ... could only materialise if the unions were strong."

 Santiago agreed that a decent living wage scheme was the way to move forward in these current times. “In many countries, the minimum wage is set even below the poverty line.

However, a decent living wage will ensure the worker has money for food, non-food items and savings,” he said.

Source: Free Malaysia Today