Wage reform: Ireland replaces minimum wage with living wage | the news

Lohnreform: Irland will den Mindestlohn durch einen "Living Wage" ersetzen

“Living Wage” instead of Minimum Wage

The Irish Government has introduced its new concept for a minimum wage cap, in which the current minimum wage represents a living wage, called the “living wage”. As reported by Breakingnews.ie, research carried out by the Low Pay Commission last year on the matter led to a number of proposals following the recommendations of the commission’s report. These recommendations include a proposal to set the living wage at 60 percent of the average salary for the respective year. This year, for example, it will be €12.17, while the current Irish minimum wage is just €10.50. Under the government’s new plan, the minimum wage will remain in place until the full introduction of the living wage in 2026. According to a statement from the Department of Enterprise, Trade and Employment, the minimum wage will continue to be raised annually until then to gradually close the gap between it and the living wage. From 2026, the living wage will be the new floor, meaning employers cannot pay their employees less than this year’s applicable amount.

The department adds that the Minimum Pay Commission has also been given the freedom to grant the living wage for a period longer or shorter than the prescribed four years, depending on economic conditions. “Better conditions for workers should be one of the legacies of the pandemic,” breakingnews.ie quoted Enterprise, Trade and Employment Minister Leo Varadkar as saying.

A living wage for Irish workers

Living Wage.That is, the motivation behind the reform was the idea that any type of work should bring in enough income to ensure a socially acceptable standard of living. There should be a living wage to meet basic needs. The priority is not the fulfillment of desires. It will be an evidence-based wage rate based on the agreed results of social consensus and budget standards research that establishes the cost of maintaining a minimum essential standard of living in Ireland today.

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So we are talking about a wage ceiling that can never be cut to ensure that every Irish worker’s standard of living is secure. According to the Living Wage, any income below this threshold forces workers to forgo some essential financial need to make ends meet.

Thomas Weschle / Editor finanzen.net

Image sources: karlibri/Shutterstock.com and Bacho/Shutterstock.com

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