Irish government plans new ‘living wage’

The Irish government has announced that it plans to replace its current minimum wage with a new “living wage” which will be set at a rate which allows employees to enjoy a “socially acceptable standard of living”.

However, rather than calculating precisely how much is needed, based on the cost of goods and services, the government will set the new living wage at 60% of the median (midpoint) wage. This is the proportion being recommended in the planned EU directive on the minimum wage (see article, right).

This marks a significant improvement, as the Irish minimum wage is currently €10.50 an hour, while 60% of the median wage is €12.17. The move to the living wage will be phased in over four years.