What Cyprus’ new EU minimum wage directive means for workers and employers

Cyprus is set to implement the European Union’s directive on adequate minimum wages. The Ministry of Labour will initiate discussions next week with the aim of expanding collective agreement coverage among workers.

Social partners, including trade unions and employers’ organizations, will convene with the Labour Relations Department’s head on September 10, with a follow-up meeting on September 17. Cyprus has until November 15, 2024, to comply with Directive (EU) 2022/2041, with the Ministry of Labour aiming for implementation by year-end.

To align with the directive, Cyprus is considering new legislation or amendments to the existing Minimum Wage Law. It is likely that new legislation will replace the current law.

The EU directive does not mandate a uniform minimum wage but provides a framework to ensure adequacy and encourages enhanced collective bargaining, especially where coverage is below 80%.

Currently, about 50% of workers in Cyprus are covered by collective agreements. This indicates a need for an action plan to improve collective bargaining, as supported by the trade union movement. Trade unions also seek legal recognition of sectoral collective agreements.

The changes could have several impacts:

Increased Minimum Wages: Higher wages may enhance the standard of living for workers, including those on work visas.

Enhanced Worker Protections: Collective agreements may offer better working conditions and job security.

Increased Job Costs: Employers might need to adjust wage structures, potentially influencing hiring practices.

Work visa holders should stay informed about these developments and consult legal experts to understand their potential impact. Job seekers should be aware of possible changes in wages and working conditions in Cyprus.

Non-EU nationals seeking employment in Cyprus must secure a job offer from a Cypriot employer, who will then apply for a work permit on their behalf. The work permit is necessary for obtaining a work visa, which allows entry into Cyprus for employment.

The Ministry of Labour’s move to align with the EU directive could improve worker protections and wage standards, making Cyprus a more attractive and fair destination for foreign workers.

 [Information sourced from Travelo Biz]