Ministers are set to sign off on a new minimum wage of €11.30 an hour today – with a new “recommended” living wage of €13.10 from the New Year.
It will become compulsory from 2026 and will then replace the national minimum wage.
The 80c minimum wage hike proposal has come from the Low Pay Commission and Business Minister Leo Varadkar will bring it to Cabinet for approval this morning.
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It is expected that ministers will unanimously approve the raise that will help the least well-off in Irish society.
The hike is one of the largest increases the commission has ever recommended, but it was criticised by opposition politicians for not going far enough.
People Before Profit described it as “an insult” and are calling on the Government to introduce a minimum wage of €15 per hour.
TD Paul Murphy said: “Low paid workers in this country are being hammered by the ever increasing cost of living and inflation crisis.
“If the Government really wanted to help these low paid workers, they would introduce a minimum wage of €15 per hour.
“The increase of 0.80c is an insult to people and will not even scratch the surface of what is needed.
“This will be an effective pay cut for people.”
A source close to Mr Varadkar said: “The recommendation is contained in a report from the Low Pay Commission, a statutory body made up of workers’ representatives, business representatives and independent experts.
“The Low Pay Commission says the NMW alone cannot compensate workers for inflation and recent increases in the cost of living, and it recommends additional measures are taken to support minimum wage and low-paid workers.
“The national minimum wage will be increased with effect from 1 January 2023 to coincide with necessary changes to USC and PRSI.
“Earlier this year the Tanaiste published proposals to phase in a living wage by 2026 to replace the national minimum wage.
“The living wage will be set at 60% of the median wage.
“For the first time in its annual NMW report, the Low Pay Commission sets out an indicative national living wage for 2023 of €13.10. The intention is to phase in the living wage between now and 2026 when it will become mandatory.
“The Tanaiste will be returning to Cabinet to sign off on the living wage plan next month.
“Though the planned phase-in could change over the coming years, depending on inflation and wage growth etc.”
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