Nepal’s Ministry of Labour, Youth and Employment is overhauling how minimum wages are determined, shifting from a single national floor to a system that varies by sector, province, terrain and skill level, Labour Minister Ramji Yadav said on Thursday.
Briefing industrialists and business owners, Yadav said he had commissioned a team of academic experts to design the new methodology, and that the ministry would proceed on the basis of their recommendations. Under the proposed approach, wages would be differentiated by geography (Himalayan, hill and Tarai regions), by province, and by sector, meaning workers in hotels, construction and other industries would no longer share a common minimum. A separate wage floor is also planned for skilled labour.
Nepal currently operates a two-tier minimum wage structure: one rate for tea plantation workers and another for all other workers. Under the last notification, published in the Nepal Gazette in August 2023, the general minimum wage was set at Rs 17,300 a month, against Rs 13,893 for tea plantation workers.
The Labour Act 2074 (2017) requires the ministry to revise minimum wages every two years on the recommendation of a Minimum Wage Fixation Committee, with the review process due to begin each biennial cycle in the Nepali month of Baishakh (mid-April). The ministry has begun preparatory work ahead of schedule.