Minimum wage to increase to €9.55 an hour

The 30 cent increase will be effective from January

Minimum wage to increase to €9.55 an hour

Image: Sean Defoe

The minimum wage is set to increase by 30 cent to €9.55 an hour.

The next increase was one of the recommendations of the Low Pay Commission, and will work out as an increase of only €12 a week for those working full time.

The changes, if formally agreed later this year, will come into effect in January - a year after the current rate of €9.25 was introduced.

CSO figures from 2016 show that around 10% of the population earn the National Minimum Wage or less (those earning less cited reasons such as youth or training rates).

Independent Alliance Minister Finian McGrath says the increase will help those people who are less well off.

He explained: "€12 a week is a substantial amount of money for people who are in that situation - but of course we also have to aim higher. Over the next few years, I intend to push that matter."

He added: "We still have a way to go to bringing it to the Programme for Government target of €10.50 an hour, but this recommendation is a very positive and strong step forward.”

Labour Senator Ged Nash said the move is a "welcome but very small step in the right direction".

He said: “With a miserly 10 cent increase last year and a modest 30 cent recommended for next year, the Fine Gael-Independent Alliance government is making extremely heavy weather of their pledge to hike the minimum wage rate to €10.50 per hour.

"If the government is serious about reaching its own published target, then they need to work closely with the Low Pay Commission to develop a road map to €10.50 which in itself is €1.20 short of a Living Wage which now stands at €11.70 per hour."

Jimmy Kelly of the Unite trade union also pointed towards the benchmark of a 'living wage', arguing: “While today’s modest increase is welcome, it follows on last year’s derisory 10 cent increase and still leaves the Minimum Wage over €2 short of the Living Wage."

Today's recommendation has received criticism from business group IBEC - who claim there is no justification for the proposed move.

The organisation's director of employer relations, Maeve McElwee, said: "Current trends provide no justification for such a substantial increase at a time when many Irish sectors are so exposed to competitive threats from Brexit. Any further cost burdens imposed by minimum wage increases would be extremely difficult for these sectors to withstand."

Additional reporting by Sean Defoe