New €14.80 rate highlights inadequacy of National Minimum Wage

27 September: Unite, which is affiliated to the Living Wage Technical Group, today (Wednesday) welcomed the group’s decision to increase the real Living Wage to €14.80.  The Living Wage is calculated as the minimum needed to provide a socially acceptable standard of living for an adult in full-time employment without dependents. The increase announced today was driven by rising living costs over the past year, especially in respect of energy, food and rent.

Today’s announcement that the real Living Wage is now €14.80 again highlights the gulf between the statutory Minimum Wage and the actual hourly rate needed to ensure a minimum acceptable standard of living for a full-time worker without dependents. In July, the Low Pay Commission recommended that the Minimum Wage be increased to €12.70 from January – €2.10 less than the new Living Wage.  

The new Living Wage calculation also highlights the inadequacy of the proposal for a “national living wage” of just 60 per cent of median earnings, which is estimated at €13.10 this year – again, significantly less than the real Living Wage calculated by the Living Wage Technical Group.

Commenting, Unite Regional Coordinating Officer Tom Fitzgerald said:

“If the Government is serious about tackling low pay, they should use next month’s Budget to announce a significantly higher Minimum Wage than that recommended by the Low Pay Commission. They should also reconsider the 60 per cent threshold for a new “national living wage”, and instead move swiftly to implement a living wage based on 66 per cent of median earnings.

“Most importantly, the Government needs to legislate for collective bargaining and union recognition.  All the evidence shows that collective bargaining is the single most effective means of combating low pay. This is also recognised in the EU Directive on Adequate Minimum Wages, which sets a target of 80 per cent collective bargaining coverage, and which the Government is committed to implementing.

“Rather than adding to Ireland’s piecemeal industrial relations architecture in an attempt to implement the Directive, the Government needs to move now to provide for a statutory right to collective bargaining and union recognition.  

“Enabling workers to negotiate decent wages collectively through the union of their choice is the best way to end low pay – and that is good for workers, good for communities and good for the economy as a whole”.