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Trade unions want to up minimum monthly wage to €400
28 May 2014 Flash News
THE TRADE Union Confederation (KOZ) is insisting on its proposal to increase the minimum wage to €400 per month, with its chairman Jozef Kollár claiming on May 27 that a person who works eight hours a day should not earn an amount that is below the poverty level.
“This proposal posits that after deductions into individual insurance funds - i.e. the social and health insurers - are paid, a person working for the minimum wage during standard working hours should receive a net monthly salary at the poverty level, which is €346.40,” said Kollár, as quoted by the TASR newswire, adding that this is €41.60 more than the current net monthly minimum wage.
“A minimum [gross] wage hike of €50 would be beneficial for the government, which would collect more in taxes, as one half of this figure would go into payroll taxes, i.e. deductions to the social and health insurers, while the government would receive 20 percent of the remaining €25 in the form of VAT [thanks to extra spending on the part of the employee],” said Engineering Industry Association (ZSP) vice-chairman Juraj Borguľa.
An increase in the minimum wage from €352 to €400 per month as envisaged by the Labour Ministry is not a good step given the current economic situation, president of the Employers Unions Association (AZZZ) Rastislav Machunka told TASR on the same day. Speaking on RTVS’ political discussion show Five Minutes to Twelve on Sunday, Labour, Social Affairs and the Family Minister Ján Richter said that employers are likely to be compensated for this measure via reduced levies.
“Employers have been lobbying for reductions in the payroll deductions for low-income employees for a long time,” Machunka continued. “If such a reduction in levies facilitates higher disposable incomes for these individuals, we will welcome the measure, of course.”
However, unless the overall expenditures and the ‘super gross salary’ are curbed, the hikes in the minimum wage will pose major risks, emphasised the AZZZ president. “This would contribute to further ... increases in unemployment and lay-offs of employees with low incomes,” he warned.
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