Proposal to create a higher minimum wage gets a chilly reception

A top union leader got an icy reception Wednesday when he appeared at a legislative committee that is considering a revision in the way minimum wage is calculated.

The union leader, Albino Vargas, spoke in favor of the measure that would boost the basic mandatory minimum wage about 35 percent from the current 230,000 colons (about $435.60) a month to 313,000 colons (about $592.80).

Some members of the Comisión Permanente de Asuntos Económicos said they thought that such an increase would cause more unemployment.

Vargas heads the Asociación Nacional de Empleados Públicos y Privados. He supported the bill that would base the minimum wage on the amount of money a family would need to live an average life. The Comisión Nacional de Salarios would compute the various costs such as food, telephone, housing and similar expense to arrive at a minimum living wage, according to the bill.

Vargas noted that the higher amounts would be staged in over time. Right now the salary commission fixes minimum wages every six months based on negotiations between employees and employers. The bill would anchor the wage not to the inflation rate but to what normal expenses really are. The costs would be determined by national surveys.

The bill, No. 19.312, is similar to measures introduced in the past.

Lawmakers Juan Marín Quirós, Michael Arce Sancho and Lorelly Trejos Salas of the Partido Liberación Nacional reported later that the bill lacked a technical study, analysis and support. They also said that only 15 percent of the firms in Costa Rica are transnationals and that the rest are locally owned small and medium enterprises.

The increase in the minimum wage would  have a domino effect on other salaries.

The salary commission sets minimum wages for every job classification, so an increase in the lower level would mean increases all the way to the top.

The meeting took place about the same time that the governemtn proposed  that the wage increase for the first half of 2016 would be just 0.67 of a percent.

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