Labour representatives have slammed a proposal to help employers offset a minimum wage hike by allowing them to reduce their contributions to the Social Security Fund (SSF).
The national wage committee, which is made up of representatives from the government, businesses and labour unions, resolved last Wednesday to increase the daily minimum wage by between 5 and 22 baht, but its plans to relieve the extra financial burden on employers have come under heavy criticism.
Labour rights groups have no problems with the idea of reducing employers' tax contributions from April 1, when the new rates take effect, but slashing employer contributions to the SSF is unacceptable, Manas Kosol, chief of the Employee Social Security Network, said.
Employers' representatives on the wage committee suggested the government reduce their contributions by 1% for a period of one year. At the moment, they pay 5% of employees' monthly salaries into the SSF, which also receives contributions from employees themselves and the government.
If authorities agree with this proposal, it will mean they are going to "please employers too much", despite the fact that the new wage rate is not especially high, Chalee Loysoong, deputy chairman of the Thai Labour Solidarity Committee, said.
Workers would eventually bear the brunt as their savings in the Elderly Fund will decrease, Mr Chalee said.
The Elderly Fund is part of a social and medical welfare package the government provides for employees under the SSF. It is a form of pension given to employees after their retirement.
If contributions to the Social Security Fund decrease, the Elderly Fund, which is viewed as workers' savings, will suffer unpleasant consequences, Mr Chalee said.
Deputy permanent secretary for labour Petcharat Sin-uay admitted the decrease will cause some impact on the Elderly Fund, but it is "not serious" because employers will be granted only one year of this financial relief.
However, the board of the Social Security Office (SSO) is required to consider the proposal before it can go ahead, she said.
The SSO, which oversees both funds, is studying the impact if the 1% decrease is applied. It is also considering other variations of the same plan, SSO secretary-general Suradej Waleeittiku said.
By law, both employers and employees are required to pay 5% of actual salaries into the Social Security Fund, but the calculated maximum salary is capped at 15,000 baht per month.
Dr Suradej said about 440,000 employers and 12 million employees currently make contributions into the fund. Last year those contributions amounted to more than 100 billion baht.