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Living wage, at 60% of median, to start next year

A living wage for all employees will start from next year Leo Varadkar (Tánaiste and Minister for Enterprise, Trade and Employment) has said.

The living wage will be set at 60% of the median wage in any given year, which in 2022 would amount to €12.17 per hour.

The national minimum wage is currently €10.50 per hour.

The national minimum wage will remain in place until the 60% living wage is fully phased in  in 2026, but will increase over the years as usual, closing the gap between it and the living wage.

From 2026, the living wage will be the floor, and will be mandatory for all employers.

Economic circumstances

Depending on prevailing economic circumstances, it is proposed to give the Low Pay Commission discretion to introduce the full living wage faster or more slowly than the proposed four years.

Employer and worker representative groups, unions and the public are to be consulted on the draft plan.

Last year, the Tánaiste asked the Low Pay Commission for research on a living wage, and he said today that better terms and conditions for employees must be one of the legacies of the pandemic, alongside mandatory sick pay, auto enrolment for pensions, as well as flexible working.

Statutory wage floor

Research carried out by the National University of Ireland, Maynooth for the Low Pay Commission includes evidence that a statutory wage floor set at 60% of the median wage of all workers could be implemented without substantial effects on employment.

The Tánaiste said that, although more people are in work than ever before in the history of the State, employers have had a turbulent and difficult couple of years.

“The most important workers’ right is their right to work, to have a job. That is why I am proposing we phase this in, and I will be listening to employers’ views on these draft proposals,” he said today (14 June).