Myanmar: New Minimum Wage After Five Years of Hiatus

DFDL Myanmar

18th October 2023

The National Committee for Setting up the Minimum Wage has recently announced a long-anticipated adjustment to the daily minimum wage rate, increasing it to MMK 5,800 (approximately USD 2.77). This is the first such increase to the daily minimum wage rate in the last five years.

The National Committee for Setting up the Minimum Wage (the “Committee”) has recently announced a long-anticipated adjustment to the daily minimum wage rate, increasing it to MMK 5,800 (approximately USD 2.77). The present announcement is significant as this is the first such increase to the daily minimum wage rate in the last five years. The previous increase was in 2018, when the Committee, vide Notification 2/2018, fixed the minimum wage at MMK 4,800 (approximately USD 2.30) for an eight-hour workday.

This October 2023, the Committee issued two notifications regarding the minimum wage adjustments. The first notification was issued on 5 October 2023. The second notification followed on 9 October 2023, repealing the 5 October 2023 notification.

The 5 October 2023 notification exclusively pertained to daily wage earners of government departments/organizations and Cut, Make, and Package factories. While there is no further increase in the minimum wage to commensurate the inflation, the 9 October 2023 notification increases the applicability of the revised minimum wage rate for all workers across all sectors and daily wage earners of government departments/organizations.

Per the 9 October 2023 notification, the new minimum wage rate of MMK 5,800 (approximately USD 2.77) has become effective from 1 October 2023, affecting all eligible workers across various sectors. The 9 October 2023 notification provides for an exception for the applicability of the increased minimum wage for smaller businesses employing ten or fewer workers.

Implementing the new minimum wage brings forth challenges and opportunities for businesses. While it necessitates reviewing and adjusting compensation structures, it also offers an opportunity to enhance employee satisfaction and productivity. Businesses employing more than ten workers would have to adjust to factor the increment in the October payroll itself.

The information provided here is for information purposes only and is not intended to constitute legal advice. Legal advice should be obtained from qualified legal counsel for all specific situations.

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DFDL Myanmar

Myanmar
dfdl.com

Founded in 1995, DFDL is one of the oldest foreign legal and tax firms in Myanmar.

DFDL provides a full range of legal and tax services to foreign and local investors operating in Myanmar. Our team of more than 30 experienced local lawyers and foreign legal advisers in Yangon and Naypyidaw provides efficient, effective, and practical legal services at an international standard, coupled with a high level of personal in-depth knowledge of the local environment.

DFDL is best placed to advise Asian and international companies on their investments in Myanmar.

Our Myanmar business unit is led by Partner and Managing Director William D. Greenlee, Jr.

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