Some changes for the minimum wage in Croatia.
The method which is used for the calculation of minimum wage in Croatia will soon go through sweeping changes. The Ministry of Labour will start discussions about it with social partners. After consultations with trade unions and employer representatives, the government will prescribe a minimum wage for 2016. It is certain that the minimum wage for next year will not be less than 3,029.55 kuna. Whether there will be at least a minimal increase above that level is difficult to predict because not all the parameters for the calculation are known, reports Novi List on August 18, 2015.
However, the parameters for the minimum wage will certainly change in the future. Starting in 2017, trends in average salaries will no longer be used as one of the elements for the calculation of the minimum wage. The average salary at the national level does not give a completely correct picture of trends in wages because the average includes both extremely low and extremely high salaries. Therefore, instead of the current arithmetic average, in the future the median will be used, which will produce much more realistic results.
Mirando Mrsić, minister of labour and pension system, said that the government is aware of the fact that the minimum wage is very important for combating poverty and that it needs to ensure that workers have decent working conditions. Therefore, the plan is to analyze the impact of the minimum wage on employees, employment and poverty. “Our aim is for the minimum wage to reach 60 percent of the average wage in the coming period”, said Mrsić.
Although the ministry wishes for the social partners – trade unions and employers – to agree themselves on the minimum wage, it will almost certainly not happen. Therefore, the government will again be the arbiter in that process. The minister pointed out that last year, as in previous years, employers argued that the rise in the minimum wage would automatically shut down 50,000 jobs in labour-intensive sectors, but that has not happened.
The current minimum wage is equal to 38.1 percent of the average gross salary paid in Croatian companies in August of last year. It is too early to say whether the future linking of the minimum wage with median wages will lead to the decrease of the minimum wage.