Zhejiang New Minimum Wage Standards to be Set in line with GDP Per Capita

The Zhejiang province government has announced that minimum wages in the province are to increase in line with the GDP per capita in each city during the 12th 5-year program. Local authorities should take into account the degree of financial development, cost of living and the average salary rise in each area in order to come up with an appropriate standard for the minimum wage, said a news report released by provincial authorities this week.

Over the last 17 years, the province of Zhejiang has already seen eleven consecutive increases, from RMB 200 per month in 1994 to the current minimum wage of RMB 1,100 per month – an overall increase of 450%. At one point in 2010, Zhejiang was actually the province with the highest minimum wages in China. Although this title was short lived after being overtaken by Shanghai a month later, the Zhejiang government believes that raising minimum wages fairly is an important factor in promoting a healthy average salary rise, especially for the low-income employees in the community.

Interestingly, Shanghai officials have just announced that the minimum wage in Shanghai will change effective from April 1, to RMB 1,280 per month – still the highest in the country. The Zhejiang province is expected to adjust their minimum wages again this year, and urges local authorities to tighten up on supervision practices to ensure that companies are not dodging minimum wage requirements by using piecework salary or overtime systems.

---