In February 2020 the national minimum wage in Ireland is to be increased to €10.10 per hour from €9.80.
In 2019 the Low Pay Commission recommended the minimum wage level should rise by 30 cents per hour for adults. Normally a minimum wage rise would take place in January . But the Government decided to delay the date of implementation because of fears of a “no -deal” Brexit and it’s effect on the economy.
From February 1st 2020 – these will be the increased minimum wage rates.
- Aged 20 or more : – €10.10 per hour
- Aged under 18 : – €7.07 per hour (70%)
- Aged 18 : – €8.08 per hour (80%)
- Aged 19 : – €9.09 per hour (90%)
Someone on the new €10.10 minimum wage who is working full time for 39 hours a week will earn €20,483 a year before deductions.
It was announced on January 10th 2020 that the USC threshold will be raised in line with the minimum wage. So the current ceiling of the 2% rate will go up from €19,874 to €20,484.
The USC amendment will be legislated for later in the year as part of the usual Finance Bill 2020 process but in the meantime , Revenue have agreed that this will be implemented on an “administrative basis” for the 2020 tax year.
For someone on the new minimum wage of €10.10 an hour they will have Income tax deductions of €797 ; PRSI €558 and USC €229 – leaving a take-home annual pay of €18,889 or €363 a week.
This will be an increase of €6 a week compared to the take home pay of €357 when getting the €9.80 minimum wage.
The Living Wage is a level of pay recommended by the Living Wage Technical Group. It is not mandatory – just advisory. That advisory body recently raised its recommended minimum living wage from €11.90 per hour to €12.30. Lidl is one company in Ireland that pays the Living Wage.