Industrial relations and social dialogue

Slovakia: Latest developments in working life Q4 2019

Changes in the minimum wage law, along with increases in the subsistence minimum and assistance in material need are the main topics of interest in this article. This country update reports on the latest developments in working life in Slovakia in the fourth quarter of 2019.

Changes in minimum wage law

According to Act No. 663/2007 on minimum wages, the social partners should agree on the minimum wage for the following year by 15 July of the current year. This did not happen in 2019, so the social partners submitted their separate proposals for the 2020 minimum wage to the Ministry of Labour, Social Affairs and Family (MPSVR SR).

Trade unions proposed €635 (based on a recommendation by the European Social Rights Committee that the minimum wage should be at least 60% of the average wage in net terms). Employer organisations proposed €552.20 (according to the annual increase in the average wage). The government proposed €580.

At meetings of the Economic and Social Council on 19 August and 23 September, the social partners did not agree to the government’s proposal; however, the government approved its proposal of €580 on 2 October 2019. The minimum wage for 2020 was implemented by Government Order No. 324/2019 effective from 1 January 2020. The order also increased wage supplements paid for working at night and/or during weekends.

On 16 October 2019, parliament adopted Act No. 375/2019 amending the law on minimum wages and the Labour Code, effective from 1 January 2020. The law change implements a new mechanism for setting the minimum wage. If no agreement is reached among the social partners until the required deadline, the amount of the monthly minimum wage for the following calendar year will be 60% of the average monthly nominal wage in the economy based on the previous year.

Increases in social benefits

Based on Measure SR No. 183/2019 of MPSVR, which has been in effect since 1 July 2019, the minimum subsistence allowance for a family is as follows: €210.20 for the first adult natural person; €146.64 for the second and subsequent adult natural persons; and €95.96 for dependent children or independent underage children. The measure increased the minimum subsistence allowance and benefits by 2.5% (reflecting the growth in the cost of living of low-income households). The measure also increased family, disability and unemployment benefits. In addition, it also led to an increase in the non-taxable limit of the income tax base of physical persons.

In terms of assistance for material need, effective from 1 January 2020, Measure SR No. 430/2019 of MPSVR will increase the basic benefit, activation allowance, protective allowance and dependent child allowance. The trade unions have called for a more rapid increase of the material need assistance, seeking to link this increase to the increase of the average or minimum wage.

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