Minimum Wage Increased

The situation

Effective January 1, 2019 the national minimum hourly salary will increase to EUR 9.80, up 2.6 percent from last year. For a 40-hour work week, this equals approximately EUR 392 per week / EUR 20,384 per year.

A closer look

• Existing, initial and renewal applications. Employers of foreign nationals currently on their payroll, and of those seeking to obtain or renew a work permit on or after January 1, 2019 must increase the foreign national’s minimum salary, if necessary, to comply with the new rule.
• Pending applications. Employers of foreign nationals with pending work permit applications as of January 1, 2019 must increase the foreign national’s salary, if necessary to comply with the new rule.  
• Immigration applications that do not meet the minimum wage will be rejected.

Impact

Most work authorization categories in Ireland require a minimum salary that is significantly higher than the national minimum wage. Therefore, practically, this change affects only specific work authorization categories that allow the Irish minimum wage, such as the following:

• Dependent/Partner/Spouse Employment Permit (for which the minimum annual salary is EUR 20,384 for a 40-hour week, which covers low-skilled occupations such as foreign nationals caring for children, the elderly or disabled persons (excluding all other occupations in a domestic setting);
• Internship Employment Permit and Atypical Working Scheme Authorization; and
• Intra-Company Transfer and Contract for Services employment permits, where the employee’s home country salary requires an additional monetary amount (known as a top up) to reach the minimum wage level.

 

Reminders on other requirements

• Benefits and allowances. As before, base wages of those affected by the increase will need to be raised to meet the new minimum wage requirement before other allowable expenses (such as payments for board, accommodation or health insurance) are included.
• Proof on pay slip. As before, the base wage and top up amount must be clearly visible on the foreign worker’s pay slip. Health insurance, board and accommodation costs may be evidenced by separate documentation.
• Currency. As before, employers are required to guarantee the salary in EUR regardless of payroll location and/or exchange rate fluctuations.

Background

Ireland instituted a minimum wage in 2000 for adult employees over the age of 18 with at least two years of previous employment experience. The minimum wage has increased steadily since then (the last time it was increased was in January 2018), and is considered to be on the high end as compared to the 19 other EU countries with a national minimum wage.

The minimum wage is projected to increase again in January 2020. Fragomen will report on the increase when the government publishes the new amount.

This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].