Amendment to the Minimum Wage Act

On 2 July 2019, the government adopted a draft amendment to the law on minimum wages. The most important change in relation to the current regulations is the arrangement of the issue of length-of-service allowance.

After the new regulations come into force, the length-of-service allowance will no longer be included in the minimum remuneration for work. The aim is to ensure a transparent model of remuneration for employees receiving the lowest level of remuneration. The new rules will apply from 1 January 2020, while the transitional rules will apply from 1 September 2019.

According to the legislator, the length-of-service allowance is defined as:

an allowance to be paid to an employee for reaching an agreed period of employment, in accordance with the principles set out in separate regulations, a collective agreement, another collective agreement based on the act, remuneration regulations, a statute defining the rights and obligations of the parties to an employment relationship, an employment contract or a cooperative employment contract.

Examples of the length-of-service allowances:

• Self-government employees – long-term work allowance
• Civil service members – supplement for long-term civil service employees
• Teachers – length-of-service increment
• Employees of public higher education institutions – supplement for length of service

Find out more:

Changes to the Labour Law – processing of personal data