The Council of Ministers reached a decision regarding the decree setting the national minimum wage, which is now set at the amount of €940 and will take effect as from the 01/01/2023. The decree specifies that in the first six months of the employment, the amount of the salary is fixed at €885 and subsequently if the employee remains with his employer, and shall then rise to €940.
Yet, due to the fact that the decree will take effect as from the 01/01/2023, there will be a transition period to enable the economy and employers to cope with this change. It is further understood that the full-time working hours of employees in each economic activity are those in force at the time of the issuance of this Decree, based on Legislation, Decree, contract, custom or practice.
Certain categories of employees are exempt from this Decree. These categories are those working in agriculture, domestic workers and those working in shipping. Also excluded from the Decree are those who receive more favorable treatment through contract, custom, practice or other Decree. If an employee has better benefits than those provided for in the Decree, the better benefits are not affected in any way. Persons receiving training or education to obtain a degree or professional qualification are also excluded. In addition when, within the framework of the agreed employment contract, the employer provides the employee with food and/or accommodation, the minimum monthly salary may be reduced, upon agreement between the employer and the employee, up to 15% when alimony is provided, and/or up to 10% when accommodation is provided.
The Minister of Labor stated that the first adjustment of the National Minimum Wage will take place on 01/01/2024 and from then on every two years. A nine-member committee consisting of 3 representatives of the trade union movement, 3 representatives of the employers and 3 academics or experts on labor issues is established, who advise the Labor Consultative Body, which in turn advises the Minister of Labour, who submits a reasoned report to the Council of Ministers on the adjustment of the National Minimum Wage.
The criteria for the adjustment are those included in the draft directive expected to be implemented next October and take into account the purchasing power of the National Minimum Wage, trends in employment levels and unemployment rates, variation in economic growth and levels productivity, the variation and trends in wage levels and their distribution, the effects that any change in the minimum wage will have on employment levels, relative and absolute poverty indicators, the cost of living and the competitiveness of the economy.
For any further guidance regarding this procedure or if you require an initial consultation, please do not hesitate to contact our Law Firm at [email protected], +357 22 261 777 or +357 25 261 777 or please visit our office in Nicosia or Limassol.