U.S. Department of State Assesses the Progress and Challenges of Industrial Relations in Cambodia
Subsequent to the recent passage of Trade Union Law in Cambodia and the granting by the United States Government of duty-free access to its market for made-in-Cambodia travel goods, the United States Government dispatched a mission to Cambodia this October to obtain and assess the information with respect to the working conditions, industrial relations, and commercial challenges and opportunities in Cambodia.
On 04 October 2016, on behalf of the Cambodian Federation of Employers and Business Associations, Sok Xing & Hwang Managing Director Mr. Sok Lor led a meeting with Ms. Sarah Fox, Special Representative for International Labor Affairs of the Department of State of the United States to exchange views on the progress and challenges of the industrial relations situation in Cambodia. In the meeting with the delegation, Mr. Sok Lor expressed the views that, despite certain flaws and continuing challenges, Cambodia’s industrial relations has seen major positive improvements over the past decade in terms of better working conditions and increasing wages for workers. The combination of the pioneering system and process minimum wage negotiation process with the socio-economic criteria basis for the garment and footwear sector has yielded increased confidence and stability in Cambodia’s industrial relations.
Yet, Mr. Sok Lor highlighted serious concerns of the private sector about the negative impacts of the sharp increase in the minimum wage in the garment sector that has occurred on an annual basis on the industry’s competitiveness. With the recent decision of the Labor Advisory Committee driving the minimum wage from US$140 to US$153 per month, effective on 01 January 2017, the new wage level will become on par with the minimum wage in higher-end region in Vietnam where supporting infrastructure are more robust and facilitating and workers more productive as compared to Cambodia’s.
While recognizing the progress and challenges of Cambodia’s industrial relations, Ms. Sarah Fox emphasized the need for inclusive industrial relations stability and the industry’s competitiveness through increased efforts towards the protection and promotion of labor rights and freedom of association, fair enforcement of the trade union law, and greater use of collective bargaining agreements.
Also in attendance at the meeting were Ms. Sarah Morgan, Foreign Affairs Officer, Democracy Rights and Labor of the United States Department of State; Mr. Michael O’Donovan, Director for Labor Affairs of the Office of the United States Trade Representative; Mr. Scott Schlossberg, Political Officer of United States Embassy in Cambodia; and Mr. Kaing Monika, Deputy Secretary General of the Garment Manufacturers Association in Cambodia.