As of January 1, 2026, salaries for new entrants in the public sector will increase by the same amount as the minimum wage in the private sector. For the next three years, the process for determining the minimum wage in the private sector will follow the same timetable currently in place.

From January 1, 2028, according to the Ministry of Labor’s provisions, now codified into law, a new process will be introduced for determining the minimum wage. This process will utilize a mathematical formula that takes into account inflation, especially for households in the lowest 20% income bracket, as well as economic productivity growth.

At the same time, with the passage of the bill, the EU directive on adequate minimum wages was incorporated into national law. This directive aims to increase the coverage of workers by collective agreements to 80% across the European Union.

The new system establishes August 31 as the start date for the consultation committee’s work, with the process to be concluded by the end of the year. This ensures the new wage rate will be implemented on January 1 of each year.

According to Minister of Labor Niki Kerameus, the mathematical formula will be binding for all governments, similar to how annual pension increases are determined.

A deviation clause will be allowed only in exceptional cases of adverse economic conditions, provided such cases are adequately justified and approved by the consultation committee.

Even in such cases, wages will remain “frozen,” as the law prohibits reducing the minimum wage. This guarantees the general level of worker protection and supports economically weaker households.

What Is Planned for Private Sector Salaries Over the Next Three Years

Specifically, for 2025, 2026, and 2027, the process for determining the minimum wage will follow the existing timetable. However, an additional consultation committee with an enhanced role will be established, including social partners and economic bodies (e.g., ELSTAT, Bank of Greece). This committee will aim to initiate the process of determining basic pay under the new model, even though the model will effectively apply three years later.

Thus, starting January 2025, the process for determining the new minimum wage will commence, with the wage being implemented from April 1, 2025. Economists project an increase of approximately €40, raising the minimum wage from €830 to €870.

How Public Sector Salaries Will Be Adjusted

In 2025, the pay increase for newly hired public sector employees will reflect the existing difference as of December 31, 2024, between public and private sector base salaries. Currently, the base public sector salary is €20 higher than in the private sector, at €850. If the minimum wage rises to €870 on April 1, 2025, newly hired employees will receive an additional €20 to equalize salaries, allowing for equivalent increases from 2026 onward.

Budget figures project a new horizontal increase in public sector pay scales based on the minimum wage rise (around €20 for all employees).

• If the minimum wage rises to €870, the alignment of base salaries means a €20 increase for everyone.
• For instance, an employee currently earning €1,000 will see their pay rise to €1,020 by spring 2025. Similarly, someone earning €1,200 will receive €1,220, and so on.

If the minimum wage increases by another 5% (around €40) on January 1, 2026, it will reach €910. The goal is to raise the entry-level salary to €950 by January 1, 2027.

Collective Agreements

Within a year of the law’s enactment, the Ministry of Labor will issue an action plan to increase the percentage of workers covered by Collective Labor Agreements (CLA).

This aligns with the EU directive, now part of national law, which aims to raise collective agreement coverage to 80% across the EU. In Greece, only 25–30% of workers are currently covered.

As part of this action plan, there will be extensive discussions with social partners regarding the necessary institutional measures to strengthen the framework for collective agreements. The government has made clear its intent to bolster CLAs.

Labor market economists note that the limited influence of collective agreements on wages contributes to the slow pace of salary increases. Currently, there are just 17 active sectoral agreements, compared to 55 before the bailout era.

Enhancing the impact of collective agreements (sectoral, local, professional, or those negotiated via mediation and arbitration – OMED) will provide a boost to wage increases, helping the government achieve its target of raising the average salary to €1,500 by 2027.

The Action Plan, as outlined in the law, spans one to five years and includes a clear timetable and specific measures to gradually increase the percentage of workers covered by collective bargaining, respecting the autonomy of social partners.

The Action Plan measures focus on:
a) Encouraging effective collective bargaining and enhancing the capacity of trade unions and employer organizations to conduct negotiations.
b) Establishing databases with data on wages, production costs, Greece’s economic competitiveness, and employment trends.
c) Conducting studies, research, awareness campaigns, and educational activities on collective bargaining issues.