At protest, unions demand an increase in MMA: employers ask for a wait

“Today is International Decent Work Day and on this day we want to say that we were surprised by the last meeting of the Tripartite Council, when the employers made it clear that they do not intend to increase wages and the government is delaying the decision and trying to all possible ways to postpone the decision. ” – Inga Ruginienė, president of the Lithuanian Trade Union Confederation, told Eltai.

According to her, due to the pandemic, part of the workers lost their jobs, most of them, a significant part of their income, and raising the MMA allows for quite good economic forecasts.

“Employees, like everyone else, have been severely affected, some have lost their jobs, most have lost a significant part of their income, they have shown solidarity with entrepreneurs and have been loyal with all their might. The government has allocated uninterrupted cash flows to companies to save jobs. Meanwhile, when the time comes to pay off the debts, the entrepreneurs do not change their position and say no. We want to say that we do not agree with that, “said I. Ruginienė.

According to the head of the confederation, the May 1 union, the National Union of Officials, as well as freelancers are joining the picket campaign.

“We have asked 200 employees for permission, but it is difficult to say how real it will be. I think maybe 50, maybe 100”, – said I. Ruginienė.

Unions are demanding an increase in MMA to at least € 663 (before tax). The government proposes to increase the MMA from € 35 to € 642. The decision should be made next week.

Calls to wait

Danukas Arlauskas Eltai, head of the Lithuanian Employers’ Confederation, said that the picket to be held in the Government is inopportune because, possibly due to the upcoming elections, the Government will in any case support the uprising of the MMA. He also added that the government in this case is thinking not only of workers, but also of increasing revenue from the state budget.

“The picket that will take place today is, I would say, completely inopportune, because it is obvious that the Government will also decide to increase the MMA by several dozen euros, because it is already directly related to the elections. We see how the money is distributed, and sometimes it is very strange (…) ”, he told Elta D. Arlauskas.

Speaking about the reasons why business representatives are fighting for slower growth in MMA, Mr. Arlauskas mentioned the difficult rapid recovery of the sectors most affected by the coronavirus and doubts about the exact calculation of economic growth next year.

“Some sectors obviously will not really recover until the summer of next year, like hotels, tourism, cafes, restaurants, so some differentiation is needed to exclude some sectors (increase in MMA – ELTA) because they will not have income. , so the state will have to cover the loss of income in some way, or they will go bankrupt, ”said D. Arlauskas.

D. Arlauskas stated that the best solution in this case is to wait for the elections to the Seimas and the formation of a new Government and the approval of the budget for next year.

“It just came to our attention then. After all, there are public sector companies working to receive MMA, and it will also need to be increased there, and it is still unclear how much revenue there will be in next year’s budget. After all, a few 600 million euros are now deferred for income from companies that have been tax deferred ”, said D. Arlauskas.

Carriers will surely respond better to them

According to Povilas Drižas, general secretary of the International Transport and Logistics Alliance (TTLA), the increase in MMA due to the liquidity ratio will affect transport companies much more seriously than other companies.

“The MMA coefficient of 1.65 for posted workers will increase the wages of international transport drivers by 58 euros instead of 35. In this case, the MMA applied to long-distance drivers would increase from 1001 to 1059 euros”, points out P. Drižas.

According to him, when evaluating the financial results of transport companies this year, raising the MMA in the profit line of many companies would turn into a loss.

According to the Department of Statistics, during the first half of this year, compared to the same period of 2019, the income from ground transportation decreased by 8.9 percent and the net profit of the companies before taxes decreased by up to 30.4 percent.

According to P. Drižas, the Government’s decision to increase the tax burden by imposing allowances from the beginning of 2020 had a significant impact on the contraction of profits in the transport and storage sector.

“The profitability of companies in the trucking sector in the first and second quarters of this year was only 1.2 and 1.9 percent, respectively, while last year it fluctuated 5 percent. limits. More than half of all companies are operating at a loss this year. Without a doubt, the additional taxation of labor would have an even greater negative impact on the financial stability of companies ”, says P. Drižas.

It notes that trucking companies tightened their belts in the first half of this year compared to the same period last year, reducing overhead costs by 5.4 percent to 3.17 billion. euros. Meanwhile, personnel costs have increased by $ 100 million during that time. euros.

The companies are asking the government to postpone the MMA issue due to the overly uncertain economic situation, as well as to conduct an impact assessment of this proposal accordingly.

“When considering increasing MMA, it is important to comprehensively assess the financial results and potential consequences of the trucking sector. We hear that the increase in MMA is based on Lithuania’s rapid recovery from the COVID-19 crisis and on the positive economic forecasts for next year. However, the financial situation of the road freight transport sector clearly shows that the sector is not ready to increase the wage base, “says Drižas, adding that increasing MMA may exacerbate the problem. of unemployment in Lithuanian regions where road freight companies create a significant proportion of jobs.

Last Wednesday, the Tripartite Council failed to reach a consensus on the size of next year’s MMA and recorded divergent views.

The MMA has risen in the country since this year to 607 euros “on paper”, to 437 euros “in hand”.

In the national tripartite agreement it was agreed that in Lithuania the MMA cannot be less than 45%. average salary and more than 50 percent. average salary.