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Tuesday, April 23, 2024

Unions satisfied, employers frustrated over national minimum wage

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ΙκανοποΙηση ;υντεχνιoν, απογοorτευση εργοδο τoν για τον εθνικo κατoτατο μισθo

The increase of the National Minimum Wage (NWM) from €940 to €1000 announced on Wednesday by the Government, received a different reception from the social partners, with the workers' unions mainly expressing satisfaction, while the employers' organizations spoke for an unjustified decision based on economic data.

Speaking at the KYPE, the General Secretary of the KEBE Marios Tsiakkis expressed disagreement not so much with the level of the minimum wage, but with the philosophy and practice which was applied to determine this increase.

He stated that the KEBE made it clear from the beginning that there should be a conclusion in a thorough scientifically documented formula, which will always be used to update the minimum wage, using specific indicators of the economy, such as inflation, the growth rate of the economy , productivity and unemployment.

ΙκανοποΙηση σ&upsilon ντεχνιoν, απογοorτευση εργοδοτo&nu ; για τον εθνικo κατoτατο μισθo

The social partners, he said, would have to agree with what weight they would inject these indicators into a formula that would determine the minimum wage, so that any increases would be compatible with the endurance limits of the economy and businesses. That formula, he said, could result in a lower or higher increase number than what was agreed upon.

Instead, he said an ECM was announced based on some other combination, such as a percentage of the national median wage or taking into account only inflation, something he said the CEC disagrees with.

“Bad practices of the past which it seems we are starting to repeat and we are worried that if we go with this logic we will create additional problems in the economy”, he said.

He noted that the state payroll has already increased by 15% which & #8220;not justified” and constitutes 1/3 of the state budget.

The Director General of OEB, Michalis Antoniou, told KYPE that a 6% increase in one year is not justified. He noted that taking into account the growth rate of the economy, the growth rate of national productivity, inflation and unemployment, the OEB submitted a proposal for a reasonable, justified increase in the ECM.

“This 6.5 %, the €1000, is economically unsubstantiated for the endurance and potential of the economy, because we are primarily talking about the starting salary of a person for the first time in the labor market”, he said.

Mr. Antoniou expressed the opinion that there will be domino effects on some salaries that are between €1,100 to €1,300 per month with 3-4 years of service, when new employees “good morning” will be at €1000. He estimated that there will be pressures and it will be necessary to increase these wages as well.

When asked about this, he expressed the assessment that there cannot be an increase in unemployment after the increase of the ECM, since the labor market is completely drained by workforce. He added that there is such a great need that people are not going to be laid off.

Further improvements are demanded by the guilds

The General Secretary of the SEC, Andreas Matsas, speaking to KYPE, described as positive the fact that the amount of the ECM is not below €1000, based on the approach of the European Commission, so that it is not linked to the poverty line.

At the same time, he mentioned that the €1000 cushion gives the possibility in the next period of time to create conditions and conditions, in relation to the increased median salary, to achieve something better for the workers.

However, he noted that there are weaknesses such as that the threshold is quite low compared to 1000 euros and there is a gap of 100 euros. He noted that there is a need to monitor and make sure that there is no exploitation of workers, either in relation to the performance of the minimum wage, or in relation to layoffs that may occur due to this large difference between the point of inclusion in the labor market and of employment after six months at the same employer.

He also said that the absence of the hourly rate, which they had discussed closely with the Minister of Labor and in the context of the previous negotiation, is important for the SEK.

He characterized as important the fact that the Minister of Labor in his statements yesterday put the issue of the hourly wage at the basis of his discussion in the next period of time, in order to make sure that there are no possibilities of deviation from the faithful application of the ECM. Special emphasis, he said, is given to two professional groups which are the security guards and the cleaners, cleaners whose working hours are different from the 38 hours that apply to most workers.

The PEO was not satisfied with the Government's decision on the amount of the minimum wage with the trade union indicating that despite the improvement in the minimum wage, the amount that was announced still lags behind.

In a statement, PEO states that the increase of 1.7% in the minimum wage for recruitment and by 6.4% after six months of service with the same employer does not fully restore the purchase value of the minimum wage since based on the data that PEO submitted to the evaluation committee, the erosion of the minimum wage by inflation is over 14% (2021 – 2023).

He adds that the data for the minimum hiring wage are even more unfavorable, which based on the decision does not increases at the same rate as the salary after six months' service.

A key problem continues to be for PEO, the non-determination of hourly performance of the minimum wage, considering that this way its very targeting and effectiveness is being eroded.

In its announcement, the World Federation of Independent Trade Unions (POASO) expresses satisfaction stating the amount of the ECM seems to have taken into account the ATA, as well as last year's recommendation of the European Commission, in order to meet the current cost of living and the dignified living of low-wage workers in these difficult economic conditions that prevail.

He welcomes the decision of the Minister of Labor to propose an ECM that breaks the barrier of 1000 euros, thus placing Cyprus outside the low zone of Europe (with an ECM below 1000 euros) in the zone of countries with an ECM between 1000 and 1500 Euros.

The level of the minimum wage that was determined, it is reported, shows signs of responding to the difficult conditions that the pandemic and the war in Ukraine created.


However, POASO expresses disappointment, since the Minister's Decree still lacks the determination of an hourly minimum wage, with the result that employers have the opportunity to take advantage of this and, in essence, alter the minimum wage with more working hours.

DEOK in its announcement welcomed as satisfactory the readjustment of the national minimum wage to €1,000, however, considering the issue of determining the hourly rate as of major importance.

For this issue, the union notes that it expects that soon the Minister of Labor will convene a meeting to conduct a social dialogue.

With unemployment not being negatively affected and employment showing a positive sign, the DEEK adds that to the remaining criteria for the adjustment of the minimum wage, namely indicators of economic development, productivity and income distribution, the figures of the Department of Statistics and Research were taken into account, which “cannot be disputed”.

Source: 24h.com.cy

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