Despite a recent nationwide increase in the minimum wage, many employers in Laos are still paying their workers less than the mandated amount.
Employers argue that wages should reflect workers’ skills, claiming that many lack the qualifications to justify higher pay, according to state media reports.
The Ministry of Labor and Social Welfare raised the monthly minimum wage from LAK 1.6 million (USD 75) to LAK 2.5 million (USD 114), effective 1 October, to help workers cope with rising costs and inflation.
For unskilled workers without graduation certificates, employers must also provide a subsistence allowance of LAK 900,000 (USD 41), ensuring their total earnings meet the new minimum wage. Businesses already meeting these standards are encouraged to maintain compliance.
However, many factories and private-sector businesses have refused to implement the wage increase.
Minister of Labor and Social Welfare Baykham Khattiya acknowledged the difficulties in improving workers’ living conditions and workplace standards. She noted that low wages are driving many workers to seek better-paying jobs abroad, particularly in Thailand.
The minister urged businesses to adhere to the new wage law and offer better welfare benefits to attract and retain workers. However, inflation and rising living costs continue to outpace salary adjustments, posing a significant challenge for the government.
