Minimum wage negotiations at a ‘sensitive moment’ – MCESD chairman

Discussions as to whether to raise the minimum wage, and if so, how to go about it, have reached “a sensitive moment” according to David Xuereb, chairman of the Malta Council for Economic and Social Development (MCESD).

Perit Xuereb was reacting to comments made over the weekend by Prime Minister Robert Abela, who told party media that “the minimum wage must increase” after admitting that it is currently too low.

“Discussions are ongoing with social partners to revise it upwards and I’m confident that the discussions will lead to a satisfactory result.”

On the Labour Party-owned ONE TV, the Prime Minister acknowledged the impact this could have on prices within the context of a period marked by high inflation.

Negotiations are taking place within the Low Wage Commission, which includes social and economic partners that are members of the MCESD.

Speaking to BusinessNow.mt, Perit Xuereb explains that the commission is “working hard” with the aim of having “all parties listen to and respect each other”.

While hinting that a conclusion may be reached soon, the MCESD chairman also points out that the commission is ultimately a consultative body.

“The final decision is Government’s.”

A national agreement on the minimum wage signed in 2017 stipulated that a Low Wage Commission should be set up by 2020. Reporting directly to the Prime Minister, the commission is tasked with establishing a mechanism to effectively determine whether the minimum wage will need reviewing.

The Low Wage Commission is composed of equal representation of trade union and employer organisations, together with Government representatives, and should submit its recommendations every four years, starting in 2023.

The agreement states that the commission “will specifically ascertain that any change in the minimum wage is affordable in terms of sector vulnerabilities and productivity gains”.