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Minimum Wage in Czechia May Rise to CZK 19 500

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The Czech-Moravian Confederation of Trade Unions (ČMKOS) is asserting its demand for a substantial boost in the minimum wage, urging an elevation to CZK 19,500 effective from January next year. This proposed increase of CZK 2,200 from the current year’s rate has ignited discussions within the labor sector. Additionally, the ČMKOS is advocating for higher levels of guaranteed wages. Josef Středula, the leader of ČMKOS, emphasized these points during a conversation with ČTK. However, Labor Minister Marian Jurečka (KDU-ČSL) is yet to reveal the specifics of his proposed minimum wage enhancement for the upcoming year. The Ministry of Labor is in the process of formulating a mechanism for regular indexation, currently under negotiation with trade unions and employers. However, the business community is expressing reservations about the significant wage hike.

“Our stance remains firm. We continue to push for an increase to CZK 19,500 starting in January, while also underscoring the importance of maintaining guaranteed wage levels,” Středula affirmed.

The minimum wage, impacting around 150,000 individuals, underwent an increment of CZK 1,100 to reach CZK 17,300 earlier this year. In late April, the trade unions pressed for an additional CZK 1,000 raise midway through the year due to inflation, followed by another CZK 1,200 increase at the onset of the subsequent year, culminating in a total CZK 2,200 rise effective January. This represents a notable 13 percent surge. Trade union representatives have pointed to persistent inflation and the disparity between the Czech Republic’s minimum wage and that of neighboring countries. Furthermore, they’ve highlighted that the country’s lowest earnings fall below the income poverty threshold.

However, employers are voicing their disagreement with such a substantial increase. Their concerns revolve around the concept of guaranteed wages, which reflect the minimum earnings according to the complexity, expertise, and responsibility of the job role. These wages are divided into eight tiers, ranging from the minimum wage to double the minimum wage (CZK 17,300 to CZK 34,600). The government’s adjustments for the current year were confined to the lowest and highest levels, leaving the intermediate six levels unchanged from the previous year. The trade unions are demanding a recalibration.

The Chamber of Commerce has reiterated claims that wages in the Czech Republic are outpacing productivity growth. It has previously deemed guaranteed wages as a “socialist relic” and supported their abolition. Businesses are advocating for the implementation of automatic indexation, a sentiment shared by the trade unions. However, consensus on the final formula for this remains elusive. Jurečka stated to the Czech Press Agency that discussions are ongoing and the proposal is still in development.

Minimum wage adjustments are subject to tripartite discussions involving the labor ministry, trade unions, and employers. Historically, trade unions and employers have been unable to agree on a wage increase, prompting governmental intervention. The administration had committed to the introduction of automatic indexation as part of its program agenda.


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