Minimum wage developments across the world
02 December 2014
News of minimum wages increased or introduced or not introduced points up major differences across the world.
Thanks to The Federation of International Employers, we learn that the monthly minimum wage will increase in all four of Vietnam’s wage zones from 1 January 2015. The new monthly minimum wages will be 3.1 million Vietnamese dong (145 US dollars) in Zone 1, 2.75 million Vietnamese dong (129 US dollars) in Zone 2, 2.4 million Vietnamese dong (112 US dollars) in Zone 3 and 2.15 million Vietnamese dong (101 US dollars) in Zone 4.
The UK currency equivalent ranges from about 40 to 60 pence per hour.
If this seems very low, at least Vietnam has a minimum wage, unlike seven of the 28 member states of the European Union according to a BBC report from earlier in the year.
This story confirmed that one of these countries is Germany, which is introducing its first minimum wage on 1 January 2015, the same date as the Vietnamese increase. For the first time in its history, Germany will then introduce a nationwide minimum wage of 8.50 euros per hour (about £6.75, so very close to the UK over 21 rate of £6.50). Failure to comply with the Minimum Wage Act could have serious consequences for employers, as the government can impose fines of up to half a million euros.
To see the other end of the spectrum from Vietnam, we need look no further than Switzerland. The BBC report tells us that Swiss voters overwhelmingly rejected a proposal to introduce what would have been the highest minimum wage in the world, in a referendum earlier in 2014. Under the plan, employers would have had to pay workers a minimum 22 Swiss francs, or roughly £15, an hour.