Analysis of the adequacy of the minimum wage in the Czech Republic in 2023
The project will be conducted in response to the research requirements of the Ministry of Labour and Social Affairs following the adoption of the European Parliament and Council Directive on reasonable minimum wages in the European Union. The directive was adopted by the Council of the EU on 4 October 2022. The directive sets out the requirement to set the minimum wage in the Czech Republic in a balanced way that takes into account a range of factors including the needs of workers and their families, the level of wages in the country, the cost of living, taxes, social security benefits and the relative living standards of various social groups. Moreover, the project will take into account economic factors, for example the level and development of labour productivity. The Czech Republic does not have an automatic valorisation mechanism in place; therefore, the government must update the level of the minimum wage at least once every two years according to the set mandatory criteria.
In order to determine the level of the minimum wage (or to determine and update the mechanism), member states must consider at least the following 4 criteria:
- the purchasing power of the minimum wage with regard to the cost of living;
- the overall level of wages and their distribution;
- the rate of wage growth;
- the long-term national productivity rate and its development.
The project will include the development of a methodology that will enable the assessment of the adequacy of the minimum wage according to a range of factors identified by the directive of the European Parliament and the Council on adequate minimum wages in the European Union.
Outputs