361 persons employed in the Republic of Palau are paid below the legal minimum wage. This includes employees from the government as well as the private sector, locals, and foreign contract workers.
“These could be part-time employees or people with reduced hours,” said Minister of HRCTD Ngirai Tmetuchl of the people listed to be paid below the legal wage rate. He said he will verify why these folks are being paid below legal limits. Of the 361 employees under minimum wage, 94 are locals while 267 are foreign workers.
Information from Minister Tmetuchl also showed that 2,051 persons are getting paid the $3.50 per hour minimum wage. Of this number 61 are locals while 1,990 are foreign contract workers.
Of those making over the minimum wage, a report from the Ministry of HRCTD says 4,073 are paid above minimum wage. This includes 2,041 Palauans and 2,032 foreign contract workers.
“When you increase the minimum wage, all those above minimum wages will go higher. That’s how the system works. You cannot raise the minimum wage of the person at minimum wage level up without lifting the wages of the one above that person,” President Whipps said of the minimum wage increase.
In addition to the proposed minimum wage increase, the government is introducing a bill to charge an employer $100 per month for each foreign employee, $1,200 per employee per year. This is in addition to the existing annual fees paid for foreign employee fees. The fees collected, according to Minister Tmetuchl, is to help train local people for employment.
No assessment has been made on the impact these policies combined will have on businesses, especially small to medium size businesses heavily affected by COVID pandemic.