In a context of a sharp drop in economic activity, the government decided to increase the minimum wage by 2.63% as of 1 March.
The increase, which was agreed by the Ministry of Labor and which will affect ten economic activities, was endorsed by the authorities on 6 February. Workers in free zones will be the only ones not to be subject to this increase, since wages in this sector were raised at the beginning of the year.
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.
Due to a lack of consensus between employers and workers, the government established the increase for this year at 10.4%, which will be applied in two parts, beginning with a 5,2% adjustment, starting from March.
As the business sector and workers could not agree on fixing the increase, the Ortega administration made the decision to establish the adjustment. The first increase will be 5.2% and will apply from March, while the second will also be 5.2%, and will be fixed from September of this year and will run until February 28, 2019.
The private sector has rejected the methodology used by the government to establish the increase for this year and presented a proposal to make adjustments in the future.
From a statement issued by the Superior Council of Private Enterprise (COSEP):
The Superior Council of Private Enterprise (COSEP) in light of the unsuccessful negotiations in the National Minimum Wage Commission to reach a tripartite agreement and the political decision of the government through the Ministry of Labour (MITRAB), to approve the minimum wage unilaterally, which is in effect for all economic sectors of the country from March 1 this year, wishes to express the union position on this.
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 "...