A meeting of the index committee will be held at 10 AM next Friday to announce the final agreement between the economic organizations and the General Labor Union regarding the increase of the minimum wage and transport allowance in the private sector, along with social benefits. Amid the ongoing collapse of the exchange rate, the index committee is preparing to approve the third wage increase for the private sector since the onset of the crisis, and the fourth increase for the transport allowance since the liberalization of fuel prices.
As the Lebanese economy continues to deteriorate without limits, there is no doubt that these increases will not be the last, especially with the continuous rise of the dollar in the black market, which recorded an increase of 3,000 pounds in less than a week, closing yesterday at 46,000. Additionally, the price of gasoline rose by 67,000 within just two days.
In this context, the President of the General Labor Union, Bishara Asmar, revealed that an agreement has been reached between the labor union and the economic organizations to raise the minimum wage and transport allowance in the private sector, along with a set of social benefits, which is expected to be announced next Friday during the meeting of the index committee chaired by Minister of Labor Mustafa Bayram, to implement the agreement.
Asmar told "Al-Jomhouria": "The negotiations between the two sides have resulted in an agreement to raise the minimum wage in the private sector to 4.5 million pounds and to triple family allowances, making them 180,000 for the spouse instead of 60,000 currently, and 99,000 for each child instead of 33,000. It was also agreed to triple school grants to 3 million pounds for a student in public schools or universities instead of 1 million currently, while grants for students in private schools or universities will rise from 2 million to a maximum of 6 million pounds, covering only three children. With these figures, the value of the wage basket along with social benefits reaches around 10 million pounds, noting that the labor union had requested a basket worth 20 million."
Asmar commented: "The economic organizations completely rejected the 20 million, so we agreed within a feasible policy: take and demand."
Regarding the transport allowance, it will be announced to increase from 95,000 to 125,000. An agreement has also been reached with the Prime Minister to reshape a comprehensive wage project that will ease the burden on the public sector and to issue a decree without delay to apply the increase in the transport allowance to the public sector as well.
### Taxes on Wages
As for the topic of tax measures included in the 2022 budget concerning wages in dollars, Asmar stated: "There was a near agreement between the economic organizations and Prime Minister Najib Mikati and Finance Minister Youssef Khalil to adopt an exchange rate of 8,000 pounds when declaring wages for the first 10 months of 2022, and to apply 15,000 pounds for November and December 2022, continuing throughout 2023. However, the General Labor Union rejected this agreement, and it did not proceed. Consequently, the union submitted a memo to the Prime Minister requesting to freeze the decision.
Based on this, the Prime Minister tasked Minister Nicolas Nahas with negotiating with the union to reach an acceptable formula for all. So far, the union has met twice with Minister Nahas, and a third meeting is expected this week with the Prime Minister at the Grand Serail to reach a solution."
Asmar pointed out that "the labor union refuses to apply retroactive taxation on wages, starting from early 2022. We also demand that the wage tax be progressive, starting at 3,900 pounds per dollar, escalating to 8,000 pounds up to 15,000 pounds by 2024." He noted that this agreement is still under study, and they are requesting a proposed law to be included in the 2023 budget if passed or outside it if not, which aims to prepare an urgent repeated draft law for raising the family compensation ceiling and expanding the tax brackets to alleviate taxation.
### Pension
Regarding pensions, Asmar said: "There is complete agreement on converting compensations to pensions within the social benefits package, and the subject is currently under study."
He explained that "Article 54, paragraph 5 of the Social Security Law states that pensions are optional, while economic organizations demand they be mandatory. We do not oppose this but see that proceeding with it requires changing the Social Security Law or passing the existing law currently in the general assembly of Parliament."
