Companies struggling with minimum wage increase

By TPN/Lusa, in Business · 16-07-2021 01:00:00 · 0 Comments

Around 96,000 companies have requested compensation for the increase in the national minimum wage in 2021 and 3,000 have complained about the way remuneration was accounted for.

According to Economy Minister Pedro Siza Vieira: “There was a set of companies that presented a complaint regarding the way their minimum wage was quantified,” he acknowledged, adding that “out of 96,000 companies that requested compensation, 3,000 drew attention to some discrepancies.

“For those we will try to make the adjustment, for the others we will try to make the payment as soon as possible,” he assured, a few days after the end of the deadline for companies to apply for this support that returns to companies part of the increased charges with the Single Social Tax (TSU), which the rise in the minimum wage implies.

Last week, the Confederation of Commerce and Services of Portugal (CCP) warned that hundreds of companies, employing more than 100,000 people, were excluded from compensation for the 2021 minimum wage increase.

“Two days before the deadline for companies to apply for support negotiated with the Government to compensate for the 2021 minimum wage increase, hundreds of companies from various sectors, employing more than 100,000 people, find themselves excluded from this compensation,” the CCP warned in a statement.

According to the CCP, this situation was “pointed out several times” by the CCP in the Standing Committee for Social Dialogue (CPCS) and again mentioned by the president of the confederation to the Minister of Labour.

According to the CPCS, the situation “penalises in a totally unfair and unjustified way two types of situations very common in trade or services companies”: the sectors whose collective agreements foresee a sectorial minimum wage indexed and increased in relation to the national minimum wage (for example, the collective agreement of cleaning companies foresees a minimum wage 0.5 percent higher than the national minimum wage); and companies where workers are paid by the minimum wage, but that by force of their duties receive an allowance for cash flow losses.

“In the first case” - he explained - “discrimination discourages sectors to pay above the national minimum wage.”

In the second case, “they are penalising workers with a specific function that requires them to assume cash-flow failures”.

In January this year, the national minimum wage increased by €30, to €665, with the Government aiming for €750 by the end of the legislature.

During the negotiation process with partners to set the national minimum wage in 2021, the Government announced the creation of a measure to return to companies part of the increased charges with the Single Social Tax (TSU), which the rise in the minimum wage implies, and which translates into €7.13 per month in the case of €30.



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