US embassy cable - 05TEGUCIGALPA813

UNCLAS TEGUCIGALPA 000813 
 
SIPDIS 
 
STATE FOR DRL/IL, EB/TPP, WHA/PPC, AND WHA/CEN 
STATE PASS USTR FOR WCLATANOFF 
STATE PASS AID FOR LAC/CAM 
DOL FOR ILAB 
 
E.O. 12958:  N/A 
TAGS: ELAB, ECON, ETRD, PHUM, PGOV, HO 
SUBJECT:  Honduras Agrees on New Minimum Wage - 9-12 Percent 
Raise for Workers Retroactive to January 1 
 
 
1. After typically contentious and drawn-out negotiations 
between business and labor, the Honduran Special Commission 
for the Minimum Wage approved a 12 percent increase in the 
minimum wage for 2005 on March 19.  The increase is 
retroactive to January 1, reverting to typical form after last 
year's raise which was not retroactive.  The official decree 
signed March 28 was published in La Gaceta (akin to the 
Federal Registry) on April 1.  The Special Commission includes 
the Government, the private employers' association (COHEP), 
and the three labor confederations. 
 
2. The revised daily minimum wage scale is broken down by 
sector and by size of business: small (1-15 workers) and large 
(16 or more workers).  The scale ranges from 61.26 lempiras 
(USD 3.25) per day for workers in small agriculture to 97.77 
lempiras (USD 5.19) per day for workers in financial/insurance 
companies and workers in export-oriented businesses (including 
maquilas and certain commercial agriculture such as tobacco, 
coffee, bananas, and seafood).  Workers in such areas as 
construction, services, mining, transportation, communication, 
etc. have minimum wages in between these two rates. 
 
3. The minimum wage scale in 2004 ranged from 54.7 lempiras to 
89.7 lempiras per day.  This year's raise was approximately 12 
percent for workers in small agriculture, and approximately 
nine percent workers at the top of the scale.  Inflation was 
approximately 9.2 percent in 2004 according to the Central 
Bank. 
 
Pierce