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Lusa - Business News - Portugal: Government proposes to increase minimum wage to €635 in 2020

Lisbon, Nov.13,2019 (Lusa) – Portugal’s government on Wednesday presented a proposal to the social partners to increase the minimum wage to €635 next year, according to a source from the labour ministry.
The government has set a target of €750 by 2023, with progress being decided year by year. The minimum wage is currently €600.
In a document distributed on Wednesday morning at the Social Dialogue, the government proposed that the value of the Guaranteed Minimum Monthly Pay is set at €635 from 1 January 2020 and that the impacts of updating the minimum wage be monitored regularly, in a way to be agreed with the social partners.
In addition to the minimum wage for 2020, the government proposed to the social partners that a discussion start immediately in the Permanent Commission for Social Dialogue with a view to reaching a medium-term agreement on wages, income and competitiveness, in articulation with priority issues such as valuing qualified young people, the reconciliation of work, personal and family life and professional training.
In the document, the labour ministry stated that priority should be given not only to increasing the national minimum wage but also to a more transversal strategy of valuing wages and income in Portugal and ensuring companies were sustainable.
The government also stressed that the increase has been accompanied by a certain dynamic in the economy and the labour market, which is also visible in the gradual reduction of the impact of the update of the minimum wage on employment and the wage bill.
The update of the minimum wage stimulated the appreciation of lower wages, contributing to the reduction of wage inequalities and the reduction of poverty in families, the ministry said.
Even so, the government said that wage growth has not yet reached the pace of growth necessary to ensure the desired balance in the functional distribution of income, and Portugal continues to be one of the countries with the highest levels of income inequality in the European Union.
In the last four years, the minimum wage has increased by 14% in real terms and was set at €600 this year. In September, the number of workers covered was 720,800.
The government's proposal of €635 falls short of what the CGTP wants, which is €850 in the short term and a €90 increase for all workers in 2020. The Socialist-backed UGT, on the other hand, proposed €660 but admitted to retreating to a legitimate value.
The employers' confederations have insisted that the minimum wage must be realistic and consider objective criteria such as economic growth, inflation and productivity.

Agency : LUSA

Date : 2019-11-14 08:38:00


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