Govt initiates process to revise minimum wage for workers in FY 2023-24

KATHMANDU: The government is taking steps to revise the current minimum wage for workers, effective from the upcoming fiscal year (FY 2023/24), which begins on Monday.

The Ministry of Labor, Employment, and Social Security has formed a committee headed by Joint Secretary Dandu Raj Ghimire to study the issue of minimum wage scale for workers. In its Policies and Programs for 2023/24, the government had previously announced an increase in the minimum wage for workers.

The committee comprises representatives from the All Nepal Federations of Trade Unions, the Federation of Nepalese Chambers of Commerce and Industry, the Confederation of Nepalese Industries, the Nepal Rastra Bank, and the Ministry of Industry. The committee has proposed considering the prevailing inflation rates to review the minimum wage rate.

While several trade unions have been demanding a monthly floor wage of Rs 25,000, many entrepreneurs are urging the government not to increase the wage rate. Entrepreneurs argue that businesses are still recovering from the impacts of the COVID-19 pandemic and the Russia-Ukraine conflict.

On Sunday, the Nepal Trade Union Congress (NTUC), affiliated with the Nepali Congress, organized a march calling for a wage increase for workers in both formal and informal sectors. Ajay Kumar Rai, the General Secretary of NTUC, emphasized the necessity of raising the minimum wage due to higher inflation, stating that workers are currently struggling to sustain their livelihoods. “The minimum wage for workers should be raised from the current Rs 15,000 to Rs 25,000 per month,” he stated.

The NTUC demanded that the government establish a Labor Commission, ensure worker representation in policy-making, and include workers in contribution-based social security schemes.

In 2007, the government enacted the Labour Regulation, which established the minimum wage for the first time at Rs 3,300 per month.

The Labour Law 2017 mandates revising the minimum wage for workers every two years. Two years ago, the minimum wage was increased from Rs 13,450 to Rs 15,000 per month.

In the 2018/19 budget, the government raised the minimum wage rate to Rs 13,450 per month, marking a 38.65 percent increase from the previous minimum monthly wage of Rs 9,700.