UHM reacts to FOI proposal on cost of living rise

The Union Haddiema Maghqudin has come out strongly against a Federation of Industry proposal for the government to reconsider the mandatory cost of living increase.

By law, employers must grant workers the cost of living increase laid down by the government every year independently of, and in addition to, the wage increases awarded in collective agreements.

The FOI questioned the sustainability of this situation and appealed to the social partners to reassess the position as a matter of urgency if enterprise is to remain competitive and jobs safeguarded in the coming years.

But UHM general secretary Gejtu Vella said the increase in wages related to the cost of living adjustment was calculated according to the retail price index.

"The RPI indicates the adjustments that need to be made in wages. As for increases related to collective agreements, one has to point out that such increases take into account the competitive element of any particular company."

The FOI had taken its stand in reaction to the results of a recent study published by Eurostat that highlighted Malta's minimum wage standing in relation to some EU member states and other candidate countries.

The study showed that Slovenia and Malta had national minimum wages which, broadly speaking, were at the same level as those in Portugal and Spain respectively. The monthly minimum wages in Slovenia and in Malta were €451 and €535 euros respectively. In contrast, in the other accession countries, the monthly minimum wage ranged from €116 (Latvia) to €212 (Hungary).

Mr Vella urged employers not to be shortsighted: "It's very easy to argue that the issue of competitiveness is related to wages. But there are other factors which employers have to consider including investment in human resources, training and development and money invested in research. Employers should resist the temptation to jump to the same old conclusions."