RO Govt. settles on minimum wage hike formula

Romania’s Government on December 4 published for public consultations the bill that includes the planned 7.2% increase of the minimum wage as of January 2020, and the formula used to calculate further hikes, local daily Adevarul reported.

Specifically, the minimum wage will increase by the sum of the annual inflation rate as of October, in the year preceding the hike, and the rise of per-employee labor productivity for the same year as published by Eurostat.

The rate resulted from the two components will be adjusted to the economic cycle by adding or subtracting the differential between the projected GDP growth in the target year (for which the hike is calculated) and the preceding year.

The correction is, however, capped to 2 percentage points and is subject to negotiations with the social partners.

After the rise, the gross minimum wage in Romania will be RON 2,230.

For the employees with higher education, the RON 2,350 minimum wage enforced as of January 2019 will be maintained and no specific formula was designed as a single minimum wage will be maintained in the future.

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