The gross minimum wage for employees in Romania will go up by 16 percent to RON 1,450 starting February, according to a draft bill published by the Ministry of Labor.

Before being enacted into law, the draft bill has to be approved by the left wing government of Sorin Grindeanu.

The employers that will not increase the minimum wage risk fines of RON 300 to RON 2,000 for each labor contract.

If the increase is approved, the net minimum will reach RON 1,065 (EUR 237), while the total costs for the employer, including social contributions, will amount to RON 1,783 for each employee.

In 2015, around 1.1 million people working in the private sector were receiving the minimum wage, while for the public sector, this figure stood at around 40,000, according to HotNews.ro.

In May 2016, the minimum wage rose by 19 percent to RON 1,250.

According to Eurostat, the statistics office of the European Union, Romania has the second lowest wage in the Union, just ahead of Bulgaria.

A recent study by HR consultancy Smartree revealed that wages in the private sector rose by 8 percent in the third quarter of last year. The biggest wage gains were recorded for employees in the retail and IT sectors.

The National Statistics Institute (INS) said in December 2016 that IT professionals recorded the biggest average net income of RON 5,513, while the lowest wages were in the hotels and restaurants field of RON 1,281.

Ovidiu Posirca