The minimum wage and set of fiscal laws is one of the most difficult topics for both employers and governments. Both in the Federation and in the Republika Srpska. While in the Federation we are waiting for a minimum wage of 1,050 marks, in the RS since the beginning of this year the minimum wage is 900 BAM. This decision was made by the entity government, more precisely Milorad Dodik, despite the opposition and warnings of employers that the decision will threaten the business of businessmen and lead to the dismissal of workers.
Employers appeal, economists warn: the lowest salary, which has been 900 marks since the beginning of the year, is not realistic and sustainable.
“We already have companies that have started laying off workers, and some are announcing layoffs. The most vulnerable are those who are the poorest employers, and they are located in underdeveloped places. It will be a big blow for those small towns”, says Saša Trivić, president of the Union of Employers of the RS.
The minimum wage will not change even after a meeting between employers and government representatives in Milorad Dodik’s cabinet. Dodik announces that the Government will seek a solution for employers who are in trouble, but he sees the lowest salary of 900 marks as something that increases trust in society.
“We want to preserve quality jobs, but not at the expense of losing jobs and at the expense of employers, whose work we greatly appreciate and respect,” said Dodik.
The key question is who benefits the most from an increase in the minimum wage. Workers or the Government through higher tax inflows.
“Every worker in the RS who does not receive an increase higher than inflation will be at a loss,” emphasizes Trivić.
The problems that arose after the minimum wage was increased to 900 marks were expected, says economist Zoran Pavlović. He explains that employers now have to pay 1,700 BAM for the simplest work of an employee with taxes, a hot meal and past work, which is not realistic. These are costs that will inevitably lead to higher charges for services from users or to the closure of business entities.
“The situation is such that a good part of the shops will probably be closed because they cannot pay so many obligations to the state, and it is not clear to me how the Government could make such a decision without an in-depth analysis,” asks Pavlović.
The authorities and employers have announced that they will consider solutions to the problem in the coming week. After that, there should be repeated discussions about the lowest salary.
