Most employees on the minimum wage are in construction – 36.4%. PHOTO: Archive
Businesses and unions want it defined by a formula
The minimum wage for 11 years has increased by only BGN 380 – from BGN 270 in 2011 to BGN 650 for this year. The average annual increase was BGN 34.55, and the record jump of as much as BGN 50 was in 2019 and 2020. On the other hand, in 2022 the minimum wage had to be frozen.
The lowest salaries next year will rise due to inflation, but not with the increase requested by CITUB to BGN 764, however, the caretaker Minister of Social Affairs Galab Donev is committed. This provoked warnings from businesses that it was preparing bankruptcies for small companies, which were already exhausted due to the pandemic and high bills.
from BGN 650
towards the end of March. This is 21.8% of all employees.
Most employees on the minimum wage are in construction – 36.4%, in transport – 30.7%, and in trade – 30.4%. In “Administrative and support service activities” 33.8% of the workers are insured for minimum amounts.
However, even with growth as requested by CITUB, the minimum wage in Bulgaria will remain the lowest in the EU. It is currently equal to 332.3 euros.
In 21 countries in the union have a statutory minimum wage, and in 6 others (Sweden, Denmark, Finland, Austria, Italy, Cyprus) the lowest wage is determined by sector after negotiations between business and unions.
The Hungarians are closest to us in terms of minimum income, but they receive 442.4 euros, or 110 euros more than the Bulgarians. In neighboring Romania, the minimum wage is 458.1 euros, and in Greece it is 758.3 euros.
The European Commission has proposed a European Minimum Wage Directive. Nicolas Schmidt, the commissioner responsible for jobs and social rights, explained that it was not a question of introducing the same minimum wage across the EU because it was impossible. He even gave the following example – if Bulgaria, where the minimum wage is the lowest in the EU, has to introduce the minimum wage in Luxembourg (2202 euros), more
on the next
On social issues, the EU has only limited powers, as it is not competent to interfere in national wage setting systems. The aim of the directive is to ensure that EU workers are protected by an adequate minimum wage that allows them to live with dignity. As well as to expand the scope of collective bargaining.
There has been a minimum wage in Bulgaria since 1936, and since 1945 it has been determined administratively by the Council of Ministers. Currently, this practice continues, with the decision taken by the government regardless of the opinion of business and trade unions, although it agrees on a tripartite. Over the years, various governments have tried to introduce a formula for calculating it. At the end of 2017, the Ministry of Social Affairs published a proposal for a formula that includes the current minimum wage and the forecast of the Ministry of Finance for the growth of the average.
For years, employers have also been pushing for a mechanism to set the minimum wage. It should take into account a bunch of social and economic factors that are listed in Convention №131 of the International Labor Organization (ILO), which we have ratified. Thus, wages would be determined by indicators such as the needs of employees and their families, consumer prices, cost of living, labor productivity and employment.
The unions also want a mechanism.
Among the proposals over the years is the minimum wage to be a percentage of the average or to be by profession.
Last year, a tripartite agreement was reached between the state, unions and business. according to him
it had to be
Every year the trade unions and the employers should negotiate the minimum wage by branches, and the state will not determine it administratively. If this mechanism is introduced, the state will set the minimum levels of insurance for the industries. Due to the pandemic, however, these negotiations stalled and it appears that this year the state will administratively determine its size.