Nicaraguan authorities and workers' unions decided not to make changes to the minimum wage, so it will be until 2020 when the issue is discussed again.
Days ago there was tension over the possible increase to the minimum wage in a context of economic recession, but finally the negotiating table decided not to make any change.
Beginning August 29, Nicaragua will begin to negotiate changes in the minimum wage, but the businessmen ask that the decision-making process consider the levels of inflation and fall in production.
On September 1 a second increase of 4.5% will come into effect as agreed earlier this year in negotiations between the government, unions and employers.
With the 4.5% increase the minimum wage will be $180.7 a figure that will be maintained until March 2017, when the members of the Tripartite Minimum Wage Committee will meet again.
Trade unionists who promote it, the officials who estimate it, the rulers who decree it, are not part of the legion of unemployed who surely would work for less than the official minimum wage.
EDITORIAL
The unemployed have no voice, in principle because they do not pay a sindical fee, and if they did have one, they would not raise it, because it feels devoid of the dignity necessary to do so, because they are used to adopting a very humble position in job interviews. Nothing further impoverishes the human spirit that lack of gainful income of one form or another.
On March 1st a new minimum wage structure came into force, with an adjustment of 9.8% for SMEs, 11.48% for the agricultural sector and 10.98% for other sectors.
The salary adjustment is effective from the first of March and will be implemented in two semiannual tracts. In the case of the industrial sector, subject to the taxation regime, the wage setting corresponds to 8% and will be applied in a single tranche in force until December 30 this year.
The business sector in Nicaragua has suggested that in addition to inflation and economic growth the level of productivity of workers should be taken into account when defining salary adjustments.
According to employers the current legislation has not been changed in 10 years, therefore the method for making adjustments to wages does not reflect the changes that have been experienced in the production structures in companies.
The increase approved by the guild of construction companies will apply retroactively from September 8, 2014.
Besides the adjusted upward, the Nicaraguan Chamber of Construction has agreed with unions "... a 4% increase in the prices listed in the table of labor performed piecemeal in the case of steel which is less than or equal to number 4 (1/4, 3/8 and ½ inches), and 3% higher than in steel No. 4 (8.5 inches). "
The increase, which will be applied from September 2014, varies between 4.9% and 5.38%, and applies to all industries, except the free zone regime.
The wage increase ranges between 4.9% and 5.38% depending on the manufacturing sector concerned.
Laprensa.com.ni reports that "... Wages in the free zone will remain at 4004.64 Cordobas. Meanwhile, small and medium tourism enterprises will have a minimum salary of 3142.25 Cordobas; electricity, gas, water, trade, restaurants and hotels, transport, storage and communication will be paid at least 5253.68 Cordobas; and in the construction, financial institutions and insurances sectors the wage is 6.4100 Cordobas . "
Unions and employers are negotiating an adjustment in salaries and a revision in the prices of the different types of jobs performed by workers.
Businesses are demanding adjustments are accompanied by higher labor productivity and are concerned about the growing number of construction companies that are moving into informality, however, they are confident that the agreements will be made as expeditiously as in the past three.
The Superior Council of Private Enterprise does not agree with the 10% wage increase being applied retroactively from March 1.
The minimum wage announced by the Government establishes, in addition to an average 10% increase, its retroactive application. If the retroactivity is maintained, the Superior Council of Private Enterprise (Cosep) will file an appeal.
The Ministry of Labor will define the wage adjustment in the absence of an agreement between the private sector and trade unions.
In the last meeting on 13 March the parties were not able to reach an agreement. The private company proposed an increase of 9%, while unions demanded an adjustment of between 10% and 14%.
Freddy Blandon, representative of the Superior Council of Private Enterprise, Cosep noted that "...
In order to balance the social security finances the Government of Nicaragua wants to increase employer's contributions from 16% to 19% .
Bayardo Arce, economic affairs adviser to the President, was the person who presented the project to representatives of the Superior Council of Private Enterprise (Cosep).
"... The first point of the proposal is that the Government undertakes to pay 2% of the state's debt to the INSS, estimated between $580 and $600 million, or pay it off within 50 years", reported Prensa.com.
The proposal by the business sector, which includes negotiating and approving wage agreements every three years, aims to stimulate investment and create more stability.
The initiative would be presented to the Government and the trade unions by the Superior Council of Private Enterprise (Cosep). According to the president of Cosep, José Adán Aguerri, "in light of the slow growth of the world economy and the fall in international prices of commodities such as coffee, gold and sugar, minimum wage agreements shoudl be set for a period of three years in order to make the country more productive and competitive," noted an article in Elnuevodiario.com.ni.
The increase was approved by the National Minimum Wage Commission in March and will be applied from September 1.
After approval, from the 1st of the next month the average minimum wage will be $159.87.
Eleconomista.net reports: "The Commission established this figure in March, after agreeing to a total increase of 12%, divided up into 6% applicable from that same month of March and another 6% from September 1".
Starting on the first of September the minimum wage will increase by between 4% and 6% depending on the sector.
The adjustment will be 4% for the micro and small crafts sector, as well as for the tourism activity. For the remaining companies, the required increase will be 6%.
Excluded from this increase are all industries subject to fiscal regimes, as they are governed by the social-labor coalition of the tripartite commission for free zones ".