The change will affect 80,000 employees of both the public and private sectors, the Ministry of Labour reports.
The minimum wage in Armenia is set to increase by 13,000 AMD (almost $27).
Now, instead of 55,000 ($113), workers will receive 68,000 drams ($140) as a minimum monthly salary. This is a 23.6 per cent raise.
The salary increase will affect 45,000 people in the private sector and 35,000 in the public sector, the Ministry of Labour reports.
Initially, the increase was to be just 8,000 AMD, from 55,000 to 63,000. However, the Cabinet of Ministers eventually decided to increase this amount.
“We conducted a study on four methods and saw the results. The method of the minimum socially-inclusive wage was applied, according to which we saw that in order to maintain a family with the average number of employees and the average number of members out of poverty, the minimum wage should be 67,660 AMD . . . That’s why we proposed 68,000 AMD”, explained Deputy Minister of Labor and Social Affairs Gemofin Gasparyan.
The decision was made taking into account the indicators of the minimum consumer basket and the total number of people affected by this change.
Prime Minister Nikol Pashinyan drew attention to the fact that the change may entail an increase in working hours in the private sector. Pashinyan stressed the need to pay attention to the protection of workers’ rights.
“People depend on their salaries. It is necessary to ensure that there is no manipulation or abuse with working hours.”
Atom Janjughazyan, the Minister of Finance, stressed that this project refers only to the minimum wage and has nothing to do with the basic living wage.
“There is no change in the base salary, on which many people’s payroll depends”.
What effect is the salary raise meant to have?
Armenian authorities suggest that raising the minimum wage will help solve social problems to some extent. Now the cost of the minimum consumer basket is 61,000 AMD ($125). Without the raise, people receiving minimum wages were receiving less than this minimum amount.