Minimum wage formula shift

A new mathematical formula to determine the minimum wage will apply from January 1, 2028 onward, will rely on inflation and productivity rates, and will be fully binding for the respective government. The regulation, which will be in the draft law of the Ministry of Labor, will not permit its reduction.

“As of 2028, the reduction of the minimum wage will be prohibited by law,” Prime Minister Kyriakos Mitsotakis pointed out during the presentation of the draft law to the cabinet, while Labor Minister Niki Kerameus, detailing the process, pointed out that this prohibition is provided for in Community Directive 2022/2041, which further complicates any attempt to circumvent it.

According to the minister, by 2027 the government will have achieved the goal of a minimum salary of 950 euros per month and an average salary of €1,500.

From then on, the new mathematical formula will be applied, based on two parameters: inflation, as recorded for the lowest 20% of households in income terms in the Greek economy, and half of the productivity rate of the economy, which will integrate the evolution of the total wages in the private and public sector, essentially expanding the model applied in France, where only the field of wages received by laborers is used.

By exception, in times of economic crises, the possibility of deviating from the automatic mathematical formula and setting the minimum wage on the basis of consultation is foreseen. However, it will not be allowed to decrease.

“The main priority of the government,” said Kerameus, “is to increase the income of workers and expand their purchasing power, linking the level of wages with inflation and the economic development of the country.”

She went on to add that “Prime Minister Kyriakos Mitsotakis has pledged to increase the minimum wage to €950 by 2027, an amount that translates into a total increase of 46.2% from 2019, with a parallel reduction in social security contributions by 6 percentage points by 2027.”