The gross minimum wage in Romania will increase to RON 1,450 (EUR 321) starting January next year, said Liviu Dragnea, the leader of the Social-Democratic Party (PSD), the party that won this Sunday’s parliamentary elections.

On Monday, the unions interrupted the negotiations with the current Government led by Dacian Ciolos, preferring to wait for the new PSD government to install, reports local Profit.ro.

Increasing the minimum wage to RON 1,450 was one of the main electoral promises delivered by PSD during the campaign. The gross minimum wage currently amounts to RON 1,250 (EUR 276.7). In net values, the employees will get a salary of RON 1,065 (EUR 235.7) instead of RON 925 (EUR 204.8) now.

If the new gross minimum wage increases to RON 1,450, the total cost for the employer will amount to RON 1,783 (EUR 395), including the social contributions paid by the employer, compared to a current total cost of RON 1,538 (EUR 340.5). In practice, the increase will lead to a higher fiscal burden of about RON 100 (EUR 22.1) for each minimum wage.

One in four Romanian employees was paid the minimum wage in October this year, according to official data. The number is likely to increase after the minimum wage hike.

editor@romania-insider.com