Prague - The minimum wage should be raised by 500 crowns to 9,000 crowns a month in the Czech Republic as of January 2015, the tripartite, or representatives of the government, employees and employers, agreed today.
The raising of the minimum wage still needs to be approved by the government to take effect.
"The minimum wage should motivate people to work so that it is not advantageous to live on welfare benefits," Labour and Social Affairs Minister Michaela Marksova Tominova (Social Democrats, CSSD) said after the tripartite meeting.
Marksova said the Czech minimum wage is one of the relatively lowest in the European Union. The situation is worse only in Bulgaria, Lithuania and Romania, she added.
About 100,000 people, or 2 percent of employees, receive the minimum wage in the country, according to the Labour Ministry data.
The planned increase would cost firms roughly 690 million crowns more and the state and the public sector 50 million crowns more next year. Approximately 190 and 80 million crowns more would be paid in social insurance and health insurance in 2015, respectively.
In 2007, the monthly minimum wage went up to 8,000 crowns and it remained at this level until last August, when a caretaker cabinet raised it to 8,500 crowns shortly after the fall of the previous right-wing government.
The present coalition government of the CSSD, ANO and the Christian Democrats (KDU-CSL) has pledged to gradually raise the minimum wage to the level of 40 percent of the average gross salary, which was slightly over 25,000 crowns a month in 2013.
The Labour Ministry calculated that the minimum wage should grow by 600-700 crowns a year.
While the employers said the increased minimum wage may cause problems to firms focusing on social services, trade and leather manufacturing, trade unions want a higher increase.
"It might have gone up far more dynamically if the labour and finance ministries took certain measures and prevented the unofficial payment of salaries," CMKOS umbrella union leader Josef Stredula said, referring to the fact that workers received cash in hand.
Stredula said the monthly minimum wage should reach 12,000 crowns.
Last week, Marksova mentioned this sum, too, saying it could be reached at the end of the election term in 2017.
Czech Confederation of Industry head Jaroslav Hanak said the economic development and condition of firms need to be taken into account.
The tripartite today dealt with the situation in the healthcare sector and with the 2015 draft state budget. Its next meeting is scheduled for June 30.
Growth of minimum wage in the Czech Republic:
|Year||Minimum||Increase (in crowns)||Increase (in percent)|
Source: Labour and Social Affairs Ministry