Cyprus will fully harmonize with the EU minimum wage directive

One of the main achievements of the European Parliament’s current term of office is the establishment of a legislative framework for the minimum wage. This development has had consequences for workers in Cyprus.

The new legislative rules, adopted by the European Parliament in 2022, aim to set minimum wages at a level that guarantees decent living and working conditions.

Member States are encouraged to promote collective bargaining, which is essential for achieving adequate minimum wages.

EU minimum wage directive

Regarding the content of the EU Directive, it should be noted that, while setting the minimum wage remains the responsibility of Member States, governments must ensure that their national minimum wages enable workers to live decently, based on the cost of living and general wage level.

To assess wage adequacy, Member States may establish a basket of basic goods and services in real terms, or define this as corresponding to 60% of the gross median wage and 50% of the gross average wage.

Minimum wage in Cyprus

Cyprus set a minimum wage threshold for the first time with the 2022 Minimum Wage Decree, which came into force on January 1, 2023.

The decree initially set the minimum wage at €940 per month for a full-time job. However, the current government amended the decree in December of the previous year and increased the minimum wage to €1,000 per month.

According to the applicable framework, every full-time employee must receive a minimum monthly salary of € 1,000 gross, while those who have not worked continuously for the same employer for six months up to the six months must receive at least € 900 gross per month. have been completed.

A senior official from the Ministry of Labor noted that there was a political decision to introduce a minimum wage in Cyprus, but discussions and agreements within a European framework gave additional impetus to its implementation.

The official also stressed the importance of the directive in prioritizing wage adequacy and promoting collective agreements, with the implementation target set at reaching 80% of the labor force.

The government adheres to the EU’s labor policy

Speaking to Phileleftheros, Minister of Labor Yiannis Panayiotou emphasized that the government is fully aligned with the EU’s labor policies. “We intend to fully harmonize Cypriot legislation with the specific directive on the minimum wage by 2024,” he noted, adding that the increase in the minimum wage in Cyprus last December from €940 to €1,000 per month will benefit 25,000 workers has come.

He further added that the increase in the minimum wage in 19 professions within the hotel sector, a move that positively affects another 5,000 workers, came through a ministerial decision.

When asked how compliance with minimum wage regulations is ensured, Panayiotou referred to targeted inspections by relevant departments investigating related complaints and the use of data provided to the Social Security Administration that can reveal potential violations.

Regarding collective agreements, Panayiotou pointed out that through social dialogue and collective bargaining, several agreements have been renewed, and others are currently being negotiated with the involvement of the Ministry.

He also noted that the government has included in its 2024 plan the development of incentive schemes for organizations and companies that implement good labor practices, including collective bargaining agreements.

Support for collective bargaining

Moreover, as collective bargaining at sectoral and cross-sectoral level is considered an essential factor for achieving adequate minimum wages, it should be promoted and strengthened. In concrete terms, Member States where less than 80% of the working population is covered by collective bargaining must develop an action plan, in collaboration with the social partners, aimed at increasing this percentage.

Compliance and enforcement

It is also noted that under the new directive, EU countries are required to put in place an enforcement system that includes reliable monitoring mechanisms, controls and on-site inspections to ensure compliance and address issues such as unlawful subcontracting, unregistered overtime and the intensification of labor.

(By Nicoletta Kouroushi and Stelios Marathovouniotis)

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