Collective agreement on minimum wage in construction industry has so far been signed by more than 120 companies whose own account construction works make up EUR 519 million, which is 73% of the minimum amount for the collective agreement to come into force and become binding on the entire construction sector, informs LETA.
However, more companies are signing the agreement.
For the collective agreement to come into force and be binding on the construction industry, it has to be signed by companies whose own account construction works make up 50% of that of the entire industry. Last year, construction industry’s own account construction works amounted to EUR 1.4 billion, which means that the agreement must be signed by companies with the total amount of own account construction works of at least EUR 713 million.
Latvian Partnership of Building Contractors head Baiba Fromane previously told LETA she expected that companies with own account construction volume of EUR 450 million would sign the collective agreement during a conference on fair competition in Latvia’s construction industry on May 10, and the rest of construction companies would sign it in the near future.
There are many companies that have not yet decided whether to sign the collective agreement, including several large construction companies, said Fromane. She is surprised that some of the large companies are not too enthusiastic, although they have done construction work in Scandinavia and elsewhere in Europe where collective agreements are the norm. Fromane hopes that these companies will change their mind and sign the collective agreement during the next two months.
The collective agreement on minimum wage is the most important reform in the construction industry since the restoration of independence, said Fromane. The agreement will not only improve Latvian construction companies’ competitiveness, it will also reduce the share of the shadow economy and improve protection of the rights of those working in construction sector.
The work on the collective agreement continued for 2.5 years to agree on the minimum wage level, convince companies of the advantages of the collective agreement, and Fromane hopes that the required number of companies will sign it in the next two months so the agreement could come into force.
As reported, it is planned that the general collective agreement of the Latvian construction industry will take effect on January 1, 2019. The agreement provides for the minimum monthly wage in the construction sector at EUR 780 and, in case of part-time workers, the minimum hourly wage at EUR 4.67.