Costa Rica minimum wage up to $346.40 per month

June 20, 2008

Costa Rica’s National Salary Council on Monday green-lighted a 6.58 percent increase on minimum wages in the private sector for July 1, which the Labor Ministry says should help “recuperate the purchasing power” of the nation’s lowest earners in the face of a rising living costs.

On top of that, an added ¢5,000 ($9.60) should go to unskilled low-wage earners such as cleaning staff and car wash attendants and an extra ¢4,000 will go on the pay checks of semi-skilled workers, including drivers, shop attendants, guards and lower-earning office personnel.

Some labor leaders, however, are not content. They say the raise from ¢164,007 (about $315.60) a month to less than ¢180,000 ($346.40) just scrapes the surface of what is needed.

“We’re not totally satisfied because the salary gap is difficult to resolve with a half-yearly wage raise. What’s needed is a sustained policy of recuperating the salaries’ purchasing power,” Albino Vargas, secretary general of the National Association of Public and Private Employees (ANEP), told The Tico Times yesterday. “What happened (Monday) was a circumstantial adjustment and, furthermore, it’ll be difficult to check if companies follow through with it.”

In addition to more cohesive government measures, ANEP was bidding for at least a 10 percent raise, Vargas said.

But Labor Ministry spokeswoman Ana Isabel Gartela said that while the wage increase is meant for low earners, in many companies it ends up lifting all boats, as employers use it as an opportunity to give pay raises across the board.

She said the government takes into account the cost of living with each salary hike. Accumulative inflation from January to June has reached 5.94 percent. The ministry added that number to 0.64 – which was the difference between predicted and actual inflation for December, when the last salary adjustment was calculated – to arrive at the minimum wage increase of 6.58 percent.

Next month’s raise will be the highest since the 6.84 percent increase of January 2006, according to another ministry spokesman, Geovanny Díaz. Private sector minimum wages rose by 5.1 percent last July, and by 4.95 percent in January 2007, Díaz said.

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