Mihai-Gabriel Ciobanu
The initiative developed by the Ministry of Labor and Social Protection is aimed at bringing the national legislation in line with European norms. The stated aim is “to strengthen social protection of workers and fight poverty among the employed population through the establishment of an adequate level of remuneration”.
The document also encourages collective bargaining at the level of industries and individual enterprises so that real wages exceed the legal minimum, reflecting “labor productivity and the current economic situation”.
Mihai-Gabriel Ciobanu, the ministry’s state secretary, explained the essence of the changes:
“The citizen, regardless of whether he works in the public or private sector, should understand that this bill introduces a new criterion that helps in negotiating the minimum wage at the national level and that will affect the setting of this level in the short and medium term. We have a new additional criterion by which we can assess the adequacy of the minimum wage – this very indicative value – and a specific percentage by which we can determine whether the wage is low or high.”
Despite the positive expectations of the authorities, many people, even deputies with economic education, did not understand the essence of the changes, if, as Ciobanu said, in essence “nothing changes” in the calculation of the minimum wage in the country. He still could not answer the question of deputy Volodymyr Odnostalko specifically, what should be the minimum, really “adequate” wage for today, “so that a person does not die”.
Expert on the reform: a tool to bring wages out of the shadows
To clarify the situation, we asked for a comment from an expert in the field of labor law, lawyer Vitaly Postolake. He believes that the initiative may play a key role in the legalization of income.
“This project will strengthen the protection of workers through a fair minimum wage that will reflect the cost of living, productivity and wage dynamics, thereby contributing to the reduction of working poverty and promoting upward social convergence,” the expert said. “Indicative benchmarks may be used in the evaluation process, including a value of 50% of the average monthly wage for the economy projected for the previous year. I have not analyzed the project in detail to every comma, but, at first glance, this is a good thing. The average monthly wage across the economy will probably go up, and the minimum wage will automatically follow. Salaries of 1,000 or 2,000 lei per month will no longer exist, because everyone understands that a person cannot survive on this money,” the lawyer explained.
According to the expert, regular revision of the minimum threshold will help to fight the practice of issuing salaries that do not provide even the subsistence minimum.
“The payment “in envelopes” is reduced, and the state enters the legal mainstream, having more declared amounts, from which taxes, contributions to pensions and health insurance are paid. In principle, this is the right thing to do, that is, to legalize income. There are people who want to have a higher salary “on paper”, but the employer is not interested in showing it in order not to pay taxes. Either he does not hire at all, or sets conditions: 1/10 part officially, the rest – “in an envelope”. Thanks to this procedure, the minimum wage will increase, and the employer will no longer be able to hide income and will be forced to increase the official part. This is really a project that will strengthen the protection of workers,” added Vitalie Postolake.
The draft is being prepared for the second reading. The application of the law in practice will require the elaboration of additional governmental decisions, which will clarify the technical details. As this is part of Moldova’s commitments in the EU accession process, there is no doubt that the draft will be quickly adopted in the final reading.
“This is a European directive that we are obliged to integrate. The idea is purely technical, and now all attention is focused on how exactly the bylaws necessary to launch this mechanism will be drafted,” Vitalie Postolache concluded.
The law will enter into force upon its publication in the Monitorul Oficial.
