The Serbian Association of Employers: Compromise is realistic, additional measures needed

The increase in minimum labour cost by 6.6%, defined today by the Government of the Republic of Serbia, represents a real compromise between the demands of the Trade Union and the Serbian Association of Employers. In order to make increase sustainable and able to give its full effect, it is necessary to implement additional measures that enable companies to introduce the increase, without jeopardizing their own business.

We remind the readers that from 2010 until today, the minimum price of labour has doubled (from 90 to 183.9 dinars per hour), while the growth of the economy has not even closely followed that growth. In 2020, we had a major pandemic impact on the companies’ operations, and the gross domestic product is projected to fall by approximately 3%, and in the most optimistic scenario it should stay around zero.

In this situation, the Association reiterates its request to facilitate the company’s operations through additional measures. These additional measures are an increase in the non-taxable part of wages (the Association demanded 19,000 RSD, the Government accepted 18,300 RSD), a reduction in taxes and contributions on wages by at least 1% as well as the abolition of taxes and parafiscal levies, of which there are more than 500.

“Additional burden on the economy is unbearable for the companies at this moment. More than 90% of companies suffered a financial upset due to the Covid-19 pandemic, as many as 85% of them assessed that there is no any room for increasing the minimum wage “, says Srdjan Drobnjaković, Director of the Serbian Association of Employers. “Only relieving companies will enable the long-term payment of increased salaries, and ultimately the strengthening of domestic investments, which is one of the weakest points in the macroeconomy of Serbia. ”

The Serbian Association of Employers is grateful to all the participants in the negotiations on the minimum wage for the constructive atmosphere. As a representative of employers, the Association is ready to continue the discussion with all relevant institutions on improving the conditions for doing business and enhancement of the business climate, without which there will be no progress in the economy and increase in employees’ living standards.

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