Thailand will raise its minimum wage to THB400 (US$11.7) daily from October 1, 2024, while implementing supportive measures for businesses and small enterprises affected by the increase.
Key Points
- Thailand will raise its nationwide minimum wage to THB400 (US$11.7) per day starting October 1, 2024, despite concerns from businesses. The decision was confirmed by Labour Minister Phiphat Ratchakitprakarn after consultations and a study by the Ministry of Labour.
- The increase will apply to companies with at least 200 employees, with measures in place to support these businesses, including a 1% discount on Social Security Fund contributions for the next year.
- Small and medium-sized enterprises (with fewer than 200 employees) are exempt from the wage increase, and additional support will include low-interest credit from financial institutions and tax discounts for companies providing employee training.
Thailand is set to implement a nationwide minimum wage increase to THB400 (approximately US$11.7) per day starting October 1, 2024. This decision, confirmed by Labour Minister Phiphat Ratchakitprakarn, follows extensive consultations with business stakeholders and a detailed study from a subcommittee of the Ministry of Labour, which highlighted the necessity of proceeding with the wage increment despite concerns about its potential negative impact on businesses.
The study, carried out in conjunction with the Social Security Office (SSO), outlined that the new wage policy would specifically apply to companies and factories employing 200 or more workers. In recognition of the economic challenges this change may pose, the SSO plans to implement measures to support these larger businesses by granting a 1% discount on their contributions to the Social Security Fund, effective next month and continuing until September of the following year.
Phiphat emphasized that small- and medium-sized enterprises, which constitute a significant segment of the Thai workforce—over 90%—will be exempt from the mandatory wage increase. Acknowledging their pivotal role in the economy, he expressed the need for targeted support to ensure these businesses can sustain their operations during this transitional period.
Additionally, the minister indicated that the government might collaborate with financial institutions to facilitate low-interest credit options for companies to help maintain their liquidity and cash flow in the wake of the wage hike. Furthermore, incentives such as tax discounts may be offered to companies that invest in career training for their employees, aiming to enhance workforce skills and adaptability amidst the evolving economic landscape.
Source : Thailand to increase minimum wage to nearly $12 a day starting next month
