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Tuesday, December 6, 2016

The state Duma adopted the law on raising the minimum wage to 7,500 rubles


The state Duma unanimously passed a law to raise the minimum wage from 1 July 2016, almost 21% – up to 7500 rubles a month. It is almost the only “cash” gift, which the MPs can make to the voters before the election. But a gift it is not for everyone: individual entrepreneurs will automatically increase insurance premiums, and some state employees could be reduced incentive payments.


photo: Gennady Cherkasov

The bill was introduced by United Russia deputies, after the consent of the extraordinary increase in the minimum wage gave the Prime Minister Dmitry Medvedev.

The last time the minimum wage increased January 1, 2016, until 6204 rubles, which meant her growth at 4% , bringing the minimum wage in Russia amounted to 53.5% of the subsistence level of the employable population.

The current increase in the minimum wage by 20.9% will lead to the fact that the minimum wage will amount to 64.7% of the subsistence minimum. Subsistence level – the official poverty threshold, and in fact the threshold of poverty.

“In 2009, the minimum wage amounted to 77.7% of the subsistence minimum in 2014 – 64%”, – reminded in the conclusion of profile Committee on labor and social policy. Meanwhile the Labour code for more than 10 years requires the phased bringing the minimum wage up to the value of this most minimum subsistence level of the employable population…

One of the authors of the bill, the head of the Committee Olga batalina (“United Russia”) told his colleagues: at the same time is working on a bill to gradually raise the minimum wage to the subsistence level by 2020.

Answering the question of Tamara Pletneva (CPRF), “are You sure that this will happen?”, Madam batalina said: the bill is prepared in the framework of the tripartite Commission with participation of representatives of government, employers and trade unions, and the unions “are ready to raise the minimum wage to a living wage tomorrow”, but the employers say about the possibility of achieving the desired result only by 2020.

In his report the Deputy explained why it is impossible right now to raise the minimum wage by more than 21%. “Every option has its risks – both economic and labour relations”,- she said. In Russia, about 1 million people receive a salary at the level of the minimum wage, 87% of them are employees of state and municipal budgetary institutions, others work in the commercial sector.

The higher raised bar – the greater the number of Russians is considered to be receiving a salary at this minimum level, in this category fall those who now pay 6500 or 7100 rubles per month. Besides deductions from payroll by employers when raising the minimum wage are rising, and we cannot allow in a sharp rise in the minimum wage they were getting rid of employees or transferred them to part-time work.

(It is worth noting that not pay below the minimum wage, the employer is obliged only in case if the employee works full-time and full-time. During the crisis, many employers, including public institutions, workers transferred to part-time, and without breaking the law, they pay 3 thousand rubles per month.)

The price of raising the minimum wage to 7,500 rubles, according to the authors of the bill – 6.1 billion rubles, 0.03% of total payroll in the country. In the feasibility study and the conclusion of the government argues that the additional costs of budgets of all levels is not required, because in all budget institutions is done “at the expense of redistribution of the wage Fund”, as in the private sector organizations will be able to increase given the forecasted growth in nominal wages in 2016 amounting to 4.8%”…

“Can you just lay off a number of people, to raise the salaries of others,” said Alexander Tarnavsky (“CP”).

“You understand what it means “at the expense of redistribution of funds”? Other state employees not getting a raise means, because the enabling Fund will be reduced!”- picked up Nikolai Ryabov (CPRF).

Madam batalina has assured that the incentive Fund, which today is in budget institutions, “enough to provide an increase in the minimum wage and not to impair significantly the position of other employees.”

Answering questions, she recalled that basically the salary at the level of the minimum wage receive technical workers in establishments of education and culture, women, many of them pensioners, bet they can be and 4,500 rubles, and on the level of the minimum wage they face due to incentive payments. For this category the increase in salary 1396 roubles will be a noticeable increase.

Maxim Shepilov (LDPR) reminded of the difficult financial situation of individual entrepreneurs, for which an increase in the minimum wage means an increase in insurance payments. Madam batalina has led such calculations: for individual entrepreneurs with an annual income less than 300 thousand rubles a fixed size of contributions is calculated by multiplying the minimum wage at the rate, and now is 19 356 rubles per year. When you raise the minimum wage to 7,500 rubles payment will be 23 400 rubles a year, such an increase “based on the analysis of the economic situation will not lead to the closure of SP”.

“We are three times lagging behind the Turks at the minimum wage!”- said Oleg Shein (“CP”). What co-Rapporteur from the relevant Committee on labor and social policy Valery Trapeznikov (“United Russia”) said that more than 20 Russian regions have adopted their own laws on regional minimum wage higher than the Federal.

“We need additional funds from the Federal budget, they say in academia, or will that take away from the poor to give to the poor. Surely the government could not show understanding of the situation?”- asked Boris Kashin (CPRF).

“Frankly, the bill was not easy, it is the result of a compromise with trade unions and employers,” said MS batalina, making it clear that to accept the document reflected a high understanding of the situation, which has been prepared to show the government.

Knowing full well that “a black sheep even a tuft of wool”, the MPs of all factions have pressed the button “for”.

By the way, the increase in the minimum wage will lead to increased benefits for pregnancy and childbirth for unemployed women – this social payment tied to this index.

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