Minimum wage hike sparks debate in Thailand’s hospitality sector

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The decision to raise the minimum wage to 400 baht per day for employees in 4-star hotels and above across ten provinces has ignited a contentious debate within Thailand’s hotel sector.

PATTAYA, Thailand – The recent decision by the 22nd Wage Committee to increase the minimum wage to 400 baht per day for employees in 4-star hotels and above in ten provinces renowned for their tourism revenue has sparked debate within Thailand’s hotel sector.

Effective from April 13, the wage hike aims to establish fairer standards for workers in the hospitality industry, particularly in areas heavily reliant on tourism. The affected provinces include Bangkok (specifically the Pathum Wan and Wattana districts), Krabi (only Ao Nang sub-district), Chonburi (specifically Pattaya City), Chiang Mai Municipality, Prachuap Khiri Khan (only Hua Hin), Phang Nga (only Khuekkhak), Phuket, Rayong (only Ban Phe sub-district), Songkhla (only Hat Yai), and Surat Thani (only Ko Samui).



However, reactions to the wage increase have been mixed. While some argue that it’s a necessary step to ensure fair compensation for hotel employees, others express concerns over its potential ramifications.

Thanet Supornsahasrungsri, president of the Association of Chonburi Tourism Federation (ACTF), emphasized the challenges faced by the hotel industry amid the Covid-19 pandemic, criticizing the minimal government assistance provided. He questioned the alignment of the wage increase with actual employee earnings, pointing out additional income sources such as service charges.

Thanet Supornsahasrungsri, president of the ACTF, expresses concerns over the recent wage hike, questioning alignment of the wage increase with actual employee earnings including additional income from service charges.

Furthermore, worries have been raised about the impact on smaller hotels and secondary cities within the affected provinces. Reports suggest that employees from 3-star hotels are contemplating resigning to seek employment in higher-paying 4-star establishments. Critics also highlight the lack of clear criteria for distinguishing between 4-star and 5-star hotels, with only a single Thai hotel standard foundation responsible for evaluating hotel quality.

Thanet called for a more gradual approach to wage adjustments, advocating for skill-based assessments and comprehensive support measures for affected businesses. He suggested potential government assistance, including reduced accommodation rates for government agencies and adjustments to long-standing government employee meal rates.