Following approval by cabinet on Monday, the Tsipras government will proceed with an 11% increase in the minimum wage and the abolition of the sub-minimum wage.
The new minimum wage, set at 650 euros, will be effective as of February 1 and will be applied to workers of all ages, thus leading to the abolition of the “sub-minimum” wage which was currently in place for young people under 25 years old.
Addressing the cabinet, Prime Minister Alexis Tsipras said that 600,000 members of the Greek workforce will benefit from the two measures, while another 280,000 workers will be indirectly affected since the hike will result in the simultaneous increase of more than 20 different types of benefits linked with the minimum income.
Greece emerged in August from its third international bailout since 2010 and the government, which faces a national election this year, has promised to reverse some of the unpopular reforms it implemented under bailout supervision.
"About 600,000 workers will be directly affected by the minimum wage increase," Deputy Labour Minister Theano Fotiou stated.
As reported on devdiscourse.com, the standard minimum monthly wage was slashed by 22 per cent to 586 euros in 2012 when Greece was struggling to emerge from a recession. A deeper cut was imposed on workers below 25 years, as part of measures prescribed by international lenders to make the labour market more flexible and the economy more competitive.