Estonia begins talks on 2027 minimum wage increase
Estonian trade unions propose raising the minimum wage to 47.5% of the average wage in 2027. Employers have not yet presented their own proposal but consider the proposed pace too fast.
Negotiations between trade unions and employers on the size of Estonia's minimum wage for 2027 have begun. The unions want the minimum wage to reach 47.5% of the average wage next year. The employers' side presented no specific figures at the first meeting.
The unions' case
The Estonian Trade Union Confederation says about 20,000 people receive the minimum wage. It adds that raising it could also affect the pay of other workers who earn less than the average. Kaja Vask, the confederation's chair, explains that as prices rise, people on low incomes find it harder to cover expenses, which increases the burden on the social welfare system because they have to apply for the subsistence benefit.
The minimum wage is currently €946, or 42% of the average wage. In 2023, unions and employers agreed to raise it to half of the average wage, and this year's proposal is the next step toward that goal.
The employers' position
Hando Sutter, head of the Estonian Employers' Confederation, acknowledges that the minimum wage must rise because the average wage has also grown. However, he says the pace must be one that businesses can withstand, particularly those outside Tallinn and Tartu. Otherwise, jobs could simply disappear in some places.
Sutter said the sides exchanged positions and discussed the state of the economy at the meeting. Employers took a pause to form their stance and obtain a negotiating mandate.
Timeline
Vask admitted it is hard to say when an agreement will be reached, and the date of the next meeting is unknown. The unions hope to settle by the end of the year, and employers also consider that deadline desirable but cannot guarantee it. Last time, the sides managed to agree only in February.
