The government decree adjusting the minimum wage for 2026 is expected to be issued at the end of December, Labour Minister Yiannis Panayiotou said on Monday, specifying that since the course of the economy is positive, the lowest paid employees are also expected to benefit from it.
Addressing the House Finance Committee that was discussing the Ministry's budget for 2026, Panayiotou also referred to the intention to submit the pension reform bills to Parliament within 2025, as well as an action plan ensuring the adequacy of salaries that must be submitted to the European Commission within the first quarter of 2026.
Budget
The budget of the Ministry of Labour for 2026 amounts to €951 million, increased by €67 million compared to last year. This amount does not include the costs of projects co-financed by the European Social Fund, amounting to €29 million. Of the total amount of €980 million (€951 million and €29 million), 21% concerns benefits, grants, schemes and projects, 3% personnel costs, 75% expenditure on the general government contribution, while operating costs are limited to 1%.
For 2027 and 2028, the budget is expected to increase to €994 million and €1,052 million respectively.
High employment rate
Panayiotou also referred to the goals achieved by the Ministry to date. Firstly, he referred to the conditions of full employment in the labour market, by ensuring satisfactory number of staff with personnel from abroad. The goal of full employment at 80% was set for 2030 and was achieved in 2025, he stressed.
“Our country is one of the few EU member states that has an employment rate at this high level,” he pointed out.
At the same time, he added, unemployment was limited to rates below 5%, and for 2025 it is expected to be limited to 4.6%.
Regarding the adjustment of the minimum wage, the Minister said that today the social partners will receive an invitation to the first meeting of the advisory committee.
Minimum wage
He noted that in order to improve the national minimum salary, the national decree will be adjusted in two phases, this December to enter into force in 2026 and in December 2027 to enter into force from 1/2028.
“The minimum salary will be adjusted and improved substantially twice,” he said.
Responding to questions from MPs about a possible increase in the minimum salary in addition to COLA (Cost of living allowance), the Minister clarified that COLA "is not an increase, it is something more. The minimum salary will be adjusted based on criteria and reference points,” he said. The Minister noted that the link with COLA gives an even more favourable result.
Regarding illegal employment, the Minister of Labour referred to the tightening of penalties and the strengthening of inspections and controls carried out, noting that there is room for further improvement.
CNA