Fórsa has welcomed draft Government proposals to replace the statutory minimum wage with a higher ‘living wage.’ Tánaiste Leo Varadkar last week announced his proposal to gradually introduce a living wage for all employees over four years, starting from 2023.

A living wage is the average hourly full-time salary needed by a single individual without dependents to afford a socially acceptable minimum standard of living. It’s currently set at €12.17 an hour, compared to the legal minimum of just €10.50.

The Government’s move comes on foot of Low Pay Commission recommendations on how the living wage could best be introduced. The Commission found that a statutory wage floor set at 60% of the economy-wide median wage could be implemented without substantial effects on employment.

Irish Congress of Trade Unions’ general secretary Patricia King said the decision was “a milestone towards addressing endemic low pay in the Irish labour market.”

The Low Pay Commission has also recommended that the rate could be adjusted from 60% to 66% of median earnings in the future.

ICTU said the the new living wage rate should be applied to all workers including young workers who do the same jobs, pay the same taxes, and have similar food and rent costs.

Its social policy chief Laura Bambrick said: “This living wage proposal will abolish hourly low pay. So, it is hugely significant not just for trade unions but the hundreds of thousands of workers on the lowest rung of the pay ladder.”

The Low Pay Commission’s report on the Living Wage, and the accompanying research report, are available here.