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October 5, 2022

Employers’ and Gov’t representatives vote in favour of 1,250 lei minimum wage from May 1

Employers and Government representatives voted to increase the minimum wage to 1,250 lei/month starting May 1, while the unions voted against it, Florian Costache, president of the Romanian National Employers’ Organization and of the Social and Economic Council (CES) stated at the end of the CES meeting.

“We held the plenary meeting of the Economic and Social Council of Romania during which we discussed the minimum wage, the Government decision. The unions, I have here a representative of the unions, Liviu Apostoiu (editor’s note: vicepresident of CNS Cartel Alfa) voted against, maintaining his initial proposals. The unions voted for the date of May 1, the date set by the Government decision, respectively 1,250 lei, and requested that a meeting be held by then, to find solutions to cut wage taxes and levies, which are currently very high. The Government representatives voted in favour,” Florian Costache stated.

He explained that the CES opinion is advisory and the Government can either take it into account or dismiss it. Representatives of the unions explained that they are maintaining their position, namely increasing the minimum wage to 1,200 lei from January 1, 2016 or to 1,275 lei, from May 2016.

“The unions said the following: we want January 1 to be the date of enforcement. We cannot wait until May because the private side, the private sector, needs this minimum wage increase. As long as the salary increase was operated in the public sector, in the private sector the salaries are dire and the private sector must benefit from January 1 (editor’s note: from the minimum wage increase) and that was 1.200 lei, just like we agreed a long time ago, when the schedule of the wage increases was agreed upon with the previous Government. We maintain this and we request that this be taken into account, that the date should be January 1. And if it is May 1, then it must be 1,275, to cover precisely the fact that in January, February and April there will not be any wage rises. This is where the 1,275 lei, starting with May 1, comes from,” Liviu Apostoiu said.

Asked what the unions intend to do in case this version of the decision in question is implemented, Apostoiu said the decision will be made after the Government meeting.

At the end of Monday’s National Tripartite Council, which took place at the Labour Ministry, the Government set forth a proposal to increase the minimum wage to 1,200 lei/month starting 1 May 2016, and the unions asked, in this context, “a correction” to 1,275 lei, in order to cover the losses suffered in the first four months of the year.

According to data provided by the Labour Inspectorate, currently 129,950 active employees earn a wage of 1,200 lei and 1,372,171 active employees receive 1,050 lei.

Finance Minister Anca Dragu recently announced that a minimum wage increase must be correlated with an impact study aimed at analysing the effects of such a decision on the private sector. The study could be made in the first quarter of 2016. In this context, Dragu showed that a minimum wage increase would have a limited impact on the public sector given that salaries have already been increased with 10 to 25pct.

Recently, the Government decided recently to freeze, for now, the minimum wage to 1,050 lei and dismiss the previous Government’s pledge to increase it to 1,200 lei from January 2016.

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