National minimum wage up to RON 1,900 as of 1 January 2018

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The Gov’t approved on Wednesday in its weekly sitting the increase of the national minimum gross wage to RON 1,900 lei (roughly 408 euro) as of 1 January 2018, a release by the Romanian Executive  informs.

According to the gov’t resolution, the gross national minimum wage will increase from currently RON 1,450 lei per month to RON 1,900 lei per month for a complete standard 166-hour schedule on average per month; the sum does not include any bonuses. It is an increase of 31.03pct against 2017 and it is influenced by the transfer of the social contributions from employer to the employee, representing 22.75pct.

“The increase of the national minimum wage targets topping the 40pct threshold of payroll costs of total production costs, so that it nears the European average of 50pct,” the Executive specifies.

The enforcement of this measure will impact the real Gross Domestic Product by 0.6 percentage points by stimulating employment, increasing the employees’ purchasing power and cutting undocumented labour, the source adds.