Minimum Wage
The Labour Advisory Council (the “Council”) can place its recommendations before the Minister for Labour on fixing and revising the minimum wage. Certain factors need to be taken into account, such as the basic needs of the employees, the general level of wages, the cost of living, the level of productivity and any other factor which may be considered necessary. Every minimum wage is to be reviewed within a time period of not more than two years. The Council can recommend fixing different minimum wages for different occupations or categories of employees.
The Labour Inspectorate is responsible for supervising compliance with minimum wage regulations. In pursuance of their duties, they can enter the workplace during working hours to inspect records, equipment, and conditions and ensure that wage laws are implemented.
An employer who does not pay the minimum wage, has committed an offence. He/she can be imprisoned for up to five years, a fine, cancellation of a license or closure of premises for up to two years.
Sources: §27, 28, 50 & 126 of the Labour Act, 2017; §24 of the Labour Regulations, 2023
Regular Pay
Basic salary means the salary along with the cost of living allowance, while excluding other allowances. The payment of wages has to be made during working hours at the place of employment or in the bank account of the employee. For employees engaged on an hourly or daily basis, the wages have to be paid by the end of the day. For employees employed for up to one month, the wages have to be paid at the end of each month. For employees engaged for a specific task, the wages are paid on the completion of the task.
The employer can make the following deductions from the salary/wages: taxes, rates, subscriptions or contribution provided by law; alimony or child care payments ordered by a court; contribution to a pension scheme; rent for accommodation due to the employer or for price of goods sold by employer to employee (as long as the employee has already given consent); repayment of money lent by the employer to the employee, subject to prior written agreement; an amount of damage suffered by the employer because of the employee; and subscriptions to be paid to the trade union by an employee.
An employer has to pay an employee all wages/salaries and any other benefits to which the employee is entitled within 30 days from the date on which employment of the employee was terminated, regardless of the cause of such termination.
Under the Labour Act and the 2023 Labour Regulations, the employer must give the employee a written pay statement with every wage/salary payment (monthly pay slip). The statement must be in a form and language the employee understands. It must show the employee’s gross wages/salary and list all lawful deductions with their purposes, any different payment methods used, and accrued entitlements owed. Failure to provide an accurate pay statement is an offence and is punishable by law.
Labour Law does not require an employer to pay 13th or 14th salary or any other mandatory bonus. Any bonuses, including end-of-year payments or performance incentives, are subject to employment contracts, company policies, or collective agreements. They are not legally mandated, but the employer can give them voluntarily.
Sources: §5, 49, 51 & 52 of the Labour Act, 2017; §23 & 25 of the Labour Regulations, 2023
