Arguing that the economic and social effects of the covid-19 pandemic in the country have been considerable, the local authorities decided that during 2021 the minimum wage will not be increased.
In no case will workers be able to have a salary lower than that set in Governmental Agreement 250-2020, which goes into effect as of January 1, 2021, the statement from the Ministry of Labor and Social Security points out.
After the Guatemalan Constitutional Court suspended the implementation of differentiated salaries in 2015, the Giammattei administration plans to discuss the application of regional minimum salaries during 2021 and the plan is for them to enter into force in 2022.
In 2015 the Guatemalan government established differentiated salaries for the municipalities of Masagua in Escuintla, Guastatoya and San Agustín Acasaguastlán in El Progreso and Estanzuelas in Zacapa.
For workers in non-agricultural, maquila and export activities, the minimum wage will increase by 3% this year in relation to what was paid in 2019.
Government agreement 320-2019, published in Diario de Centroamérica on December 30, 2019, specifies that the minimum monthly wage for agricultural activities will remain unchanged for the second consecutive year, and will continue at $388.12.
With the recent signing of the U.S.-Canadian-Mexican trade agreement, a precedent was set for future negotiations, as this agreement sets binding labor conditions, such as making exports subject to the payment of a minimum wage.
For example, one of the conditions of the Treaty between Mexico, United States and Canada (T-MEC), which was signed on December 10, 2019, is that vehicles exported from one state of Mexico to the other two countries "must come from plants that pay wages not less than $16 an hour.
The country's business sector proposes that elements such as productivity, economic growth and the level of formality be taken into account when calculating the minimum wage, instead of the decision only revolving around the basic basket variable.
The possible changes to the minimum wage in the country is an issue generating expectations among the different sectors, since in the next few days the National Salary Commission (CNS) will have to discuss the proposals to decide if it increases or decreases.
In the discussion that will begin in Guatemala on the minimum wage that will govern in 2020, the workers seek to unify their demands for an increase of between 10% and 20%.
In mid-September, the National Salary Commission (CNS) should receive the proposals from the different sectors of the workers, so that they can then be considered in the final decision.
In recent years, the sector in Guatemala has lost nearly 30,000 jobs, because the high costs resulting from having one of the highest minimum wages in the region, makes it more profitable only to export raw materials, rather than making them in the country.
Vestex figures show that in recent years several jobs have been lost in the sector, given that between 2006 and 2018 the industry lost a considerable number of jobs, going from 82,109 to 53,636 places, equivalent to a 35% decrease.
The determination of how much and how the minimum wage should be regulated, something that occasionally seems to be done in an arbitrary manner and for political purposes, continues to be one of the factors that most confront Central American businessmen and governments.
In Costa Rica, a 3% increase in the minimum wage was approved for 2019; in El Salvador, an increase is expected to be discussed, and in Guatemala, the commission in charge of the issue reported that no increases will be made this year.
For agricultural businessmen, the proposal to change the minimum wage discussed nationwide jeopardizes the jobs and incomes of about 500,000 people working in agriculture.
A savings fund, housing loans, expenses for recreation and bonuses, scholarships for children, and restaurant services for employees of the state and the monopolist hydrocarbons distributor of Costa Rica, are financed through the prices paid by consumers, even by the poorest.
Starting from January 1, 2017 new rules are in effect which govern minimum wages for agricultural, non-agricultural, export and maquia activities.
Government Agreement 288-2016 published in Diario de Centroamérica:
Article 2.Minimum wage for agricultural activities.For agricultural activitiesthe minimum wage is set at the sum of EIGHT Y SIX QUETZALES AND NINETY CENTS (Q.86.90) DAILY equivalent to TEN QUETZALESAND EIGHTY-SIX CENTS (Q. 10.86) per hour in the daytime in an ordinary work shift or what is proportional to mixed or night shifts, these wages will apply from 1 January of the year two thousand and seventeen.
Memorandum on minimum wages and payment schedule for tax liabilities for December 2016.
From a Memorandum sent by Tezó and Associates:
On 30 December 2016 the Ministry of Labour and Social Welfare published in the newspaper Diario de Centro América Governmental Agreement No. 288-2016, through which the new minimum wages are established for agricultural activities, non-agricultural activities, exports and maquilas, with effect from 1 January 2017.
One bright spring morning a garden flourished gloriously and everybody wanted flowers. John said "I deserve 10" and the gardener gave him 10 flowers. "I want to take 11" said Peter, and 11 were handed over to him. "I demand 12" protested Manuel, and he got 12. "I want 13" shouted Joseph, and he received his 13 flowers. A lot of people called out their demands and got what they asked for. In the end there was only one somewhat wilted flower left that was given to a mute person with no name. And the gardener was acclaimed for his generosity.
But the following spring the garden produced much fewer flowers, in spite of this, John tried to take his 10, Peter his 11, Manuel his 12 and Joseph his 13 flowers. "That is what corresponds to us," they shouted. "It is our right" they claimed. And they hired a lawyer who filed a lawsuit to force the gardener to deliver what belonged to them by "acquired right". And the judge, who was Manuel, ruled in favor of the plaintiffs.
Using its corporate power and taking advantage of the power vacuum that is afflicting the State, a public university in Costa Rica is paying first world salaries, exacerbating the inequality that exists between Costa Ricans and severely distorting the labor market.
EDITORIAL
The degeneration of democracy which is happening in a lot of Latin American countries has Costa Rica as an example, a country which historically used to be a shining example of the best way to live in society.