ECONOMY FINANCE&BANKING

FinMin Misa: Gov’t to introduce transitory measure to compel employer to keep certain level of gross salary

Finance Minister Ionut Misa said on Tuesday that the Government intends to issue a normative act under which contributions will be transferred from the employer’s responsibility to that of the employee and the gross salary will be kept at a certain amount level.

“There will be a law through which these contributions will be transferred to the employee and the employer will have to keep a certain level of gross salary. (…) We have noted that even today the private employer may decide to modify the employment contract and to diminish or to increase, after having negotiated with the employee, this salary value. At the same time, we have mentioned that after this legislative measure is adopted, a transitional measure that will compel even the private employer to maintain a certain level of gross salary will be introduced,” Ionut Misa told the Senate.

Asked how a private employer could be obliged to maintain the level of the gross salary, Misa explained that “there will be a legislative provision establishing what the gross salary will include, which will be the sum of all the other taxes that an employer currently pays for an employee.”

“I want to make it very clear that the cost related to workforce will not increase at all. So, for all employers, both in the private and in the state sector, the tax contribution, basically the cost they have with an employee in the relationship with the state, will be exactly the same. It will be their subsequent decision if, as I have already said, they renegotiate the contract and decide to give less or more. The employer will not pay any extra leu for an employee,” added the finance minister, who said that by this measure some employment contracts will be changed.

He explained that the share of contributions the employee will pay to the state budget will be 2.9 times higher than at present.

“Through this transfer [of contributions from employer to employee] the gross salary is increased, which will allow a rise in the pension point, which will allow each citizen to have a higher pension,” Misa said.

The minister also pointed out that “for the employer this means no extra cost”.

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