Minimum Wage Ruling Expected July 1

June 25, 2010

Costa Rica’s Labor Ministry offered a minimum wage increase this week that aligns more closely with the position of employers than that of employees.

On Monday, June 21, Labor Minister Sandra Piszk proposed raising the minimum wage for private sector employees by 4.2 percent.

Early last week, private sector employees and private unions proposed a hike of between 6.7 and 7.2 percent.

Late last week, private employers and the Union of Private Sector Chambers and Associations (UCCAEP) proposed a 3.96 percent boost in pay to the National Wage Council.

Employees claim that the government and private employers have been using an out-of-date formula from 1998 to calculate wages, and that a nearly 4 percent raise does not reflect the rate of inflation.

Press officials from UCCAEP denied the claim, and said that formulas are current and that 3.96 percent is a fair rate.

Employers can offer more than a 3.96 percent increase if they wish, officials asserted.

The National Wage Council will consider each of the proposals and is expected to offer a final ruling on July 1, at the start of the second semester of 2010. The council’s approved increase would take effect immediately.

–Mike McDonald

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