Government discusses minimum wage increase with social partners.”Starting point” is €600

  • ECO News
  • 7 December 2018

The government is due to discuss the minimum wage increase with social partners this Friday. The starting point is €600 and the government will accept higher values if "an agreement is reached".

The increase in Portugal’s minimum wage in 2019 is due to be discussed again on Friday, with the government saying that €600 is a “starting point” and that it will not oppose a higher value provided an agreement can be reached between social partners.

The amount planned for next year in the Government’s programme is €600 per month, but the union association are demanding a rise from the current €580 to €615 in the case of the UGT and to €650 by the CGTP.

However, on the side of employers’ confederations, both the CIP – Confederação Empresarial de Portugal and the Confederation of Commerce and Services of Portugal (CCP) have argued that conditions are not in place for companies to bear a figure of more than €600 due to the high tax burden.

At the first Social Dialogue meeting on 13 November, the Minister of Labour, Solidarity and Social Security, Vieira da Silva, said that the “starting point” for the negotiation was an increase of the minimum wage to €600 euros from 2019, as outlined in the Government’s programme.

However, Vieira da Silva has admitted going further, as long as there is agreement between the social partners, which will likely be difficult given the disparate positions of the union associations and employers’ federations.

“If we create conditions so that there is a broad understanding that another value [above €600] will be advantageous, the Government will not oppose it,” said the Minister of Labour.

“We are open to accepting the Government’s proposal of €600,” said the president of the CIP, António Saraiva, adding that any higher value would have to take into account measures in the State Budget to reduce the tax burden on companies .

The president of CCP, João Vieira Lopes, recalled that he had never been against the increase of the minimum wage and that companies were prepared for wages to rise to €600 per month next year.

“Now, with this current tax burden, we do not see a situation,” where the value could be higher, noted Vieira Lopes.