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 . "
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 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".
Even if the economy recovers, there may not be enough resources to increase salaries. However, a pat on the back is always well received.
Increasing remuneration is almost always the best tool to motivate an employee. When it is not available, we must turn to other options, that, if used correctly, can compensate the disillusion of not getting a pay rise.