COST OF LIVING/Labor minister defends Minimum Wage Act amid questions over CPI reference

Taipei, Dec. 13 (CNA) Labor Minister Hsu Ming-chun (許銘春) said Wednesday that the proposed Minimum Wage Act, green-lit by Taiwan's Legislative Yuan Tuesday, will adequately protect workers after labor groups questioned how the annual consumer price index (CPI) rise would be taken into account when the rate is being decided.

The act instructs the Ministry of Labor to convene a 21-member review committee which is required to meet in the third quarter of each year to review the minimum wage and recommend possible adjustments based primarily on annual CPI growth.

Several labor groups, including the New Kaohsiung Confederation of Trade Unions, Taoyuan Confederation of Trade Unions, and Taoyuan Flight Attendants Union, said Tuesday that the law should require minimum wage hikes to be at least as high as CPI growth.

Responding to the call, Hsu said to reporters there is no law anywhere in the world stipulating that minimum wage hikes must not be lower than a certain index and that passing such a law would mean less flexibility when the new 21-member review committee is deciding what the minimum wage should be.

She affirmed CPI growth is a "must" reference and that it has been used when adjusting minimum wage in recent years.

She added that in addition to CPI, 10 other indicators will also be considered, including per capita income, gross domestic product growth, and minimum living expenses, and that this method provides workers with adequate minimum wage protection.

Meanwhile, Premier Chen Chien-jen (陳建仁) also affirmed that CPI growth must be taken into account during minimum wage adjustments when asked by reporters Wednesday.

The 19-article act largely formalizes and expands on the mechanism the government already uses to adjust the minimum wage.

In addition to introducing how the minimum wage should be adjusted and the establishment of a review committee, the law states any employer found to be paying its employees less than the minimum wage will be subject to fines ranging from NT$20,000 (US$635) to NT$1.5 million, their names will be published, and they will be required to get in line with the regulations within a mandated period.