Ministry of Labor Orders Employers to Pay Wages Despite Pandemic

Ministry of Labor orders employers to pay wages

The Lao Ministry of Labor and Social Welfare has instructed employers to ensure workers are fairly compensated despite an economic downturn due to the Covid-19 pandemic.

Director-General of the Department of Labor Management, Mr. Phongxaysack Intharath, spoke at a press briefing on Tuesday explaining the steps taken by the Ministry of Labor in assuring payment of employees, and social insurance payouts.

In response to the economic downturn, the ministry has issued specific instructions for employers.

Businesses that suspended operations in April, in line with Prime Ministerial Order No. 6 (lockdown), must pay their employees the normal wage if they have not done so.

Businesses experiencing serious financial difficulties must pay their employees at least 50 percent of their ordinary wage.

Meanwhile, day laborers who earn less than the minimum wage rate set by the government should be paid at least 50 percent of the amount they typically earn, or approximately LAK 550,000.

Members of the Social Insurance scheme who were retrenched from 1 May onward will receive full unemployment benefits under the scheme.

The ministry has asked employers to respect the Law on Labor and comply with all relevant regulations and employment contracts. Both employers and employees have the right to bring their case before the Ministry of Labor and Social Welfare for consideration if they are unable to settle a dispute internally.

The Lao Government issued a Decree on the Settlement of Labor Dispute on 28 February 2018.

The unemployment rate in Laos is said to have surged from the average of 2 percent to 25 percent, according to the Vientiane Times, and the government has been advised to recommend laborers begin working in agricultural activities to support themselves and their families.