Wages to rise €4.08 next year

The cost of living weekly wage increase will be about €4.08 next year, according to the latest workings of the legally binding mechanism. The wage adjustment is linked to fluctuations in the inflation rate over the past year until September. The figure was mentioned by Joe Farrugia, director general of the Malta Employers’ Association, who said this would create an additional burden on employers. Employers would be bound by law to pay the weekly increase as from January. Official figures show that the average inflation ranged between 2.8 per cent in October 2011 and 2.3 per cent in September this year. Mr Farrugia said employers had long been calling for wage increases to be indexed to productivity instead of inflation. “It is dangerous to link wages to inflation and even the European Commission and the International Monetary Fund have repeatedly warned the Government of this,” he said. He shot down a proposal made by some unions to have the cost of living adjustment worked out twice a year, insisting it was “unworkable”. It was already difficult for employers to plan ahead in the prevailing situation, he added, let alone if wage increases were awarded twice a year. “If our...