EUR 47m in budgetary funds to go for minimum wage increase

Ljubljana – Labour Minister Janez Cigler Kralj said on Thursday that helping employers cover part of the minimum wage raise would cost the state some EUR 47 million.

The proposal to that effect will be included in the eighth economic stimulus bill, which could be in parliament in the middle of next week, he told the press.

The state will help the employers by lowering the lowest base for social contributions from 60% of the average salary to the sum corresponding to the minimum wage.

In this way, it will shoulder some 42% of the raise, or EUR 40 per minimum wage earner, the minister explained.

The measure will be in force until the end of June with the option of a six-month extension if the epidemic is extended.

Two days ago, Cigler Kralj announced he would set the minimum wage for 2021 at 1,024 gross, or 20% above the minimum cost of living, and up from EUR 941 gross in 2020.

This is the lowest possible rise under the new formula, which entered into force this year in line with the 2018 changed to minimum wage legislation.

Commenting on some employers’ dissatisfaction with the formula to cover part of the increase, the minister said today: “I think what we have on the table is an optimal compromise which provides businesses with the much needed aid. At the same time many aid measures are still in place or are being extended.”

Cigler Kralj also said that the draft economic stimulus bill would be discussed by the Social and Economic Council, which should scrutinise it by Monday.

He said it brought measures worth EUR 320 million, keeping the subsidies for furloughed workers and for those taking part in a short-work scheme.