The wage hike decision in detail

After arduous consultations, a new minimum wage of 868,000 LBP was approved as of 1/12/2011, in addition to an official minimum daily wage of 33,000 LBP including the transportation allowance that rose to 236,000 LBP per month.         

To reflect the rising cost of living, the first salary range (from 0 to 1,000,000 LBP) was increased by 18% the second salary range (from 1,500,000 to 2,500,000 LBP) was increased by 10%.      

The monthly value of scholarships was set at 40,000 LBP for every enrolled student, with a maximum of 160,000 LBP.        

This increase will burden employers especially that the increase to reflect the rising cost of living included salaries and transportation allowances. Therefore, each employee will cost his employer an additional 182,000 LBP.         

Besides scholarships, end of service indemnity of about 278,000 LBP plus number of years worked, employers must pay additional social security fees resulting from the inclusion of the transportation allowances in the basic salary by 5.21%, equivalent to 60,000 LBP.        

In this regard, Labor Minister Charbel Nahhas said that the salary is an integral part. “The salary and the transportation allowances are one package”, he said.           

Nahhas said that the minimum wage will be 500,000 LBP plus 236,000 LBP, equal to 736,000 LBP. If we add the 18% to reflect the rising cost of living, the official minimum wage becomes 868,000 LBP.        

According to Nahhas, the additional cost that the employers will shoulder will not exceed 10%, while the previous decision cost them 14%.