Why successive increases in the Smic could trap millions of employees – BFM Business

With this fourth rise in the minimum wage in 10 months, the minimums for professional branches are mostly below the minimum wage, which limits wage increases in companies. And by four. With the return of inflation, the minimum wage will rise again. The next increase in the minimum wage will take place on August 1 and will be 2.01%. These are automatic increases linked to inflation. The minimum wage increases as soon as the price index increases by 2% compared to the last increase. Inflation having been confirmed at 5.8% in June, the minimum wage will therefore increase again, for the fourth time in 10 months: +2.2% in October 2021, +0.9% in January, +2.65% in May and therefore +2.01% in August. Net, on the basis of 35 hours worked per week, the Smic will be around 1328 euros per month from August 1st. An increase of nearly 8% in less than a year. Last September, before the first increase in October, the Smic was 1231 euros net per month, almost 100 euros lower. With the increase in the planned activity bonus of 4%, a single person with the Smic benefiting from the activity bonus can therefore hope to receive 1540 euros net per month. Good news for purchasing power but a risk for a large number of employees: that of being trapped on minimum wage for years. In 2021, 12% of French people were on minimum wage in France. A proportion that has been falling slightly for 3 years. But with the many increases in recent months, this share should increase and perhaps even exceed the record level reached in 2005. That year, nearly one in six French people (16 .3%) was paid minimum wage. The danger being that even with seniority and experience, employees never take off the minimum wage. Today 65% ​​of professional branches (112 out of the 171 most important) have in fact grid minima below the Smic. Smic, which is illegal. On the other hand, salary evolutions can be decorrelated from career evolutions. The employer must pay his employee the Smic but is not required to increase it if the minima in his branch are lower than the legal minimum wage. In the private hospital sector, for example, 46 steps are lower than the Smic. An employee with 15 or 20 years of seniority can therefore be paid like a beginner. Under pressure from the government, the social partners have accelerated the pace of negotiation of pay scales within the branches. From 85% in May, the share of professional branches outside the nails fell to 65% at the end of June. At the Ministry of Labor, we now want to move up a gear. The bill on purchasing power provides for the merger of recalcitrant branches in the event of too slow salary renegotiations. The government has therefore decided to threaten the branches which do not negotiate the update of the conventional grids more quickly. Those that do not increase their minima will be merged with more virtuous branches.