One in five employees in Latvia earn below minimum wage

For 20% of natural persons, income per month in Q3 of this year does not reach the minimum wage. Most of them are employees in companies, according to data from the State Revenue Service (VID), Latvian Radio reported November 29.

If an employee's income does not reach the minimum wage, it mostly means they are working part-time. Last year, amendments were adopted by the Saeima that employers would have to pay social contributions for part-time employees. Employers will receive this bill in December.

Finance Ministry's representative Ilmārs Šņucins said: “Speaking of the time it's being introduced. Yes, we see there is a Covid crisis and for many it is not a short-term issue, but after the economic slump in 2020, we see economic growth going up this year and the coming years and growing demand for working hands. It is not a critical situation in the labor market. Average wages are also rising,” Šņucins said.

According to VID's assessment of the income of natural persons in Q3 this year, 20% or more than 179,000 natural persons do not earn 1,500 euro in three months (three minimum monthly salaries), from which mandatory social contributions should be paid.

VID spokeswoman Inga Mukāne said that almost 90% of these individuals were workers in companies. 65.5% were between the ages of 25 and 63, which is the economically active population.

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