minimum-wages

Minimum Wage Increase: January 2025

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From 1 January 2025, the national minimum wage in Ireland will increase to €13.50 per hour for employees aged 20 and above. This marks a notable change aimed at addressing the rising cost of living, but some argue it may not go far enough to make a significant impact on workers’ financial pressures. Minimum Wage Increase: January 2025

New Minimum Hourly Rates by Age

The updated minimum hourly rates of pay will be as follows:

Category of EmployeeHourly Rate
Aged 20 and above€13.50
Aged 19€12.15
Aged 18€10.80
Aged under 18€9.45

Gross Wage Components

For the purposes of calculating compliance with the National Minimum Wage, your gross wage includes:

  • Basic salary
  • Shift premiums
  • Bonuses
  • Service charges

Board and Lodging Deductions

If your employer provides food (board) or accommodation as part of your employment, the maximum amounts that can be deducted from your wages will be as follows from 1 January 2025:

  • Board only: €1.21 per hour worked
  • Accommodation only: €31.89 per week or €4.55 per day

While these deductions are regulated, critics argue that they still disadvantage employees who rely on their employer for essential living arrangements, particularly given the high cost of housing.

Excluded Categories of Employees

Certain groups of workers will not qualify for the National Minimum Wage, including:

  • Employees who are close relatives of the employer (e.g., spouse, child, or sibling) if the employer is a sole trader.
  • Craft apprentices, as defined under the Industrial Training Act (1967) or the Labour Services Act (1987).

Concerns About the Minimum Wage Increase

While the increase to €13.50 per hour will benefit many workers, critics highlight several shortcomings:

  • Cost of Living: The rise in wages may be outpaced by soaring rents, childcare costs, and energy bills.
  • Youth Workers: Younger employees earning significantly less than the adult minimum wage may struggle to meet their basic needs, particularly if living independently.
  • Employer Pressures: Small businesses may face challenges in meeting the higher wage requirements, potentially leading to reduced hiring or hours for staff.

Conclusion

The minimum wage increase represents a step towards improved earnings for many workers, but its effectiveness in addressing broader affordability challenges remains to be seen. Policymakers must consider complementary measures, such as affordable housing and better access to childcare, to ensure that wage increases translate into meaningful improvements in workers’ lives.

Minimum Wage Increase: January 2025

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