With the new minimum wagehttps://en.protothema.gr/tag/wages/ at its heart, Labour Minister Niki Kerameos is today presenting to the Council of Ministers the draft law to transpose the EU directive on decent minimum wages into national law.

The minimum wage will be calculated, following the French model, from 2028 using a mathematical formula that takes into account objective economic elements such as inflation, overall productivity growth, purchasing power and the general level of gross earnings.

The new system allows automatic wage adjustment to be “frozen” in adverse economic conditions, but not reduced to ensure the general level of protection for workers and to support the most economically vulnerable households.

Importantly, the minimum wage in the private sector will also apply to new entrants to the public sector.

It is clarified that in 2025 the minimum wage determination process will remain the same while the second, intermediate phase will start on 1 June 2025, so that in 2025 the consultation can be carried out in accordance with the new deadlines and the new composition of the Committees for the statutory minimum wage and the statutory minimum wage effective from 1/1/2026. The interim phase will last until 31/12/2027.

In the conclusion of the scientific committee on the new way of calculating the minimum wage, it is proposed that the annual change in the minimum wage be the sum of

(a) the annual rate of change in the consumer price index between 1 July of the previous year and 30 June of the current year for the lowest 20% of the household income distribution; and

(b) one-half of the annual rate of change in the purchasing power of the general wage index over the same period of time. That is, the Commission proposes that the automatic adjustment of the minimum wage should take into account both inflation and productivity growth in the economy.

In fact, as the price reports, the new system is proposed to be implemented from 1/1/2028 in order for the National Statistical Service to have the necessary time to “construct” two key indicators that currently do not exist :

a) the wage change index that will be used in the future also for the calculation of pensionable earnings and

(b) the consumer price index for the lowest 20% of the household income distribution which shows that inflation affects poor households more

In the context of incorporating the EU directive, the leadership of the Ministry of Labour is also considering interventions in the field of Collective Bargaining, with a roadmap to increase the proportion of workers covered by collective bargaining to raise average wages. The Community directive sets a target of increasing the percentage of workers covered by collective agreements in the European Union to 80%. In Greece, the percentage of workers covered by a contract ranges from 25% to 30%.

At the same time, two provisions are expected to be included as amendments in the tax bill that will be submitted for consultation: Changes to the Pensioners’ Solidarity Contribution (SSC) and the reduction of contributions from 1/1/2025. The same Treasury bill is expected to include the arrangements for the high prices cheques for the vulnerable to be paid at Christmas.