Minimum wage increase: The glitch!
What happened to the decree relating to the second 5% increase in the minimum wage? Tired of waiting for publication of the decree concerning the second instalment of the minimum wage increase, some companies have already proceeded with their September pay rise.
Other, more “legalistic” companies, sticking to compliance considerations, have preferred to wait for a legal basis for a retroactive increase in the minimum wage. Some regional offices of the Social Security Fund (CNSS) have even sent emails to members informing them that “as of September 1, the Smig (minimum wage) / Smag (minimum agricultural wage) has been increased by 5%. Please take this increase into account in your next declarations from September 2023 onwards”. Another e-mail clarified that the previous e-mail was “just for information, the application of this increase will only be implemented when the decree is communicated by the Government Council”. The situation is comical, given that the decree concerning the second increase in the minimum wage should have been published several weeks ago, for implementation as early as last September. The companies concerned thought they had seen the light at the end of the tunnel after the draft decree No. 2.23.845 was examined and adopted by the Government Council, which met on Thursday September 21. All that remained to be done was to forward the draft text to the General Secretariat of the Government (SGG) for publication in the Official Gazette. However, the gatekeeper realized that it wasn’t quite right. Indeed, applying a 10% increase to an amount does not give the same result as if it were increased by 5% in two stages (2022 and 2023). The difference is considerable. According to the calculations of a chartered accountant, applying the 5% increase to a minimum wage (Smig) already revalued by 5% would give an increase of around 5.25% instead of 5% as agreed within the framework of social dialogue, which exceeds the level initially envisaged and which was 10% in all. It should be remembered that some companies employ several thousand employees, all of whom are paid the minimum wage, which indicates the potential financial stakes involved. The draft decree is currently being held up at the General Secretariat of the Government for these unprecedented reasons. The Employment Ministry will have to rewrite the draft decree and resubmit it to the next Government Council meeting for review and approval. The aim would be to revise the calculations to bring them into line with the level of increase agreed at the end of the last round of social dialogue at the end of April 2022. Should a 10% increase be applied to the latest minimum wage (Smig), which was in force until the end of August 2022, and spread over two operations, or should the 5% rate be revised downwards? According to the information in our possession, the draft decree has been rewritten to correspond to the 10% increase agreed as part of the social dialogue. It now remains to be seen whether the piece of legislation will be discussed and adopted again by the Government Council, or published directly in the Official Gazette.
Hassan EL ARIF
