Minimum wage under debate

Two successive government decisions to set the Polish national minimum wage without the agreement of the social partners has led to an attempt to change the law. The rate had been set by tripartite consensus for six years, until 2010 when the government insisted on a rate lower than that agreed by the social partners. The government unilaterally set the rate again this year, and the Solidarity union has attempted to introduce legislation fixing it at 50% of average earnings.

How the minimum wage is set

In Poland the national minimum wage is set annually in accordance with the Minimum Wage Act of 2002. The Tripartite Commission for Social and Economic Affairs (Trójstronna Komisja ds. Społeczno Gospodarczych) decides the wage level for the next year based on proposals submitted by the government.

In order to be considered binding, the decision has be made unanimously by the social partners and the government. The figure proposed by the government must not be less than the current minimum wage, adjusted to the national Consumer Price Index (CPI) forecast for the next year. However, if the current minimum wage is lower than 50% of the national average pay, the following year’s proposed minimum wage also has to be increased by two thirds of the percentage growth in GDP forecast for the following 12 months. If the Tripartite Commission cannot agree, then the government takes the decision unilaterally – although it cannot set the wage any lower than its original proposal. Workers in their first year of employment receive 80% of the minimum wage rate. As of 2011, over 300,000 workers are paid the minimum wage.

Government decision

Between 2003 and 2009, the Tripartite Commission, by consensus, increased the minimum wage each year. However, in 2010 the government ignored the central-level social partners’ decision to raise the gross minimum wage from PLN 1,317 in 2010 (€291 as at 29 November 2011) to PLN 1,408 (€310) for 2011, and enforced a lower increase (to PLN 1,386, or €306). This was widely criticised by the social partners, as their recommended wage increase (to 50% of national average pay) had been agreed in the original anti-crisis package formulated by the central-level social partners, and presented to the government in March 2009. The current minimum wage is roughly 41% of average pay. Following lack of consensus among the Tripartite Commission members in 2011, the government again stepped in to unilaterally set the minimum wage for 2012 at a rate of PLN 1,500 (€331).

Solidarity gets public backing for new law

Disappointment at the government’s 2010 decision prompted a debate on amending the Minimum Wage Act. The Solidarity (NSZZ Solidarność) trade union, the largest in Poland and the main trade union social partner, decided to prepare an independent legislative proposal to permanently fix the level of the minimum wage at 50% of the national average.

In the spring of 2011, the Civic Legislative Initiative Committee for Amending the Minimum Wage Act was established with Solidarity Chair Piotr Duda as the head. In April the draft legislation (in Polish, 800Kb PDF)) was submitted to the parliament. By law, civic draft legislation has to be supported by at least 100,000 citizens in order to be acted upon by parliament. By July, 350,000 Poles had signed the draft. This was subsequently presented to the Sejm (the lower chamber), where it went through its first reading in mid-September, and was afterwards handed over to the parliamentary Committee for Social Policy and Family Affairs for further proceedings. However, the last parliamentary term came to an end in October and the newly elected parliament has yet to commence its activities, and it is unclear if and when the legislative process for this bill will continue.

Commentary

Raising the national minimum wage to 50% of the national average is high on the trade union agenda. Following the adoption of the autonomous anti-crisis package in 2009, one might have expected the minimum wage to gradually move in that direction. However, the events of the last two years indicate a growing lack of concern for social dialogue about the minimum wage on the part of government. In these circumstances, the future of the civic draft legislation is unclear.

Jan Czarzasty, Institute of Public Affairs (ISP)

Useful? Interesting? Tell us what you think. Hide comments

Eurofound welcomes feedback and updates on this regulation

Add new comment