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Employers' org leader says latest increase in minimum wage violates custom
An increase in the minimum wage from October 1 violates a custom and one of the few predictable things for the business community, namely that it is to be negotiated in the autumn of the current year among unions, employers and the government and come into force at the beginning of next year, says Radu Burnete, executive director of the Concordia Employers' Confederation.
"The government adopted the minimum wage increase applicable from October 1, 2023. We say once again that it is wrong for this increase to be implemented in such a short time - there are 3 days left until the application. Practically, tomorrow, all companies should update all employment contracts of employees paid the minimum wage. In addition, companies have wage budgets set for the current year based on the negotiations we conducted last year. Right now, the economic outlook for 2024 is deteriorating, the business community is subject to a series of external economic pressures, and the predictability is already extremely low due to the lack of transparency with which the tax measures were treated," Burnete is quoted as saying in a press statement released on Friday.
He said that at the beginning of 2023, the national minimum wage overgrew inflation, as a Concordia analysis of the minimum wage shows, adding that "there is no reason to believe that this will not happen next year as well."
"But for this we need time and serious discussions in a tripartite formula, not decisions made, once again, unilaterally, with immediate application," said Burnete.
In addition, the representative of the employers' organisations says that as the Romanian government itself specified in a point of view issued last year regarding a proposal to amend the Labour Code that Romania must, under its National Resilience and Recovery Plan (PNRR), implement an objective mechanism next year based on which the gross minimum pay nationwide should be established.
"The new mechanism must be thought of in line with the guidelines of the Directive on adequate minimum wages in the European Union. The development of such mechanism must bring predictability and clarity, principles currently not respected by the Romanian government. The European mechanism should be a step forward, but until we get there, the government has chosen to take a step back," according to Burnete.
The government on Thursday approved a raise by 10% from October 1 in the gross minimum wage from RON 3,000 to RON 3,300 , an increase said to benefit 1,867,000 employees
Government spokesperson Mihai Constantin said Thursday that the raise will have an impact especially on transport, trade and SMEs.