Romania: The Government has Set the Rules on How to Determine and Assess the Minimum Wage
In November 2024, the Romanian Labour Code has been amended by Law No. 283/2024 in order to implement the general rules set by the EU Directive No. 2022/2041 on adequate minimum wages in the European Union. To make these general rules functional and establish a procedure that will be used to determine the annually proposed level for the minimum wage, the Government issued Decision No. 35/2025 that sets the responsibilities of the Ministry of Labour, Family, Youth and Social Solidarity and the procedure for setting and updating the minimum wage.
The Ministry will be responsible for applying the general procedure set by the Labour Code for implementing, monitoring and evaluating the mechanism for setting, updating and evaluating the adequacy of the minimum wage. In order to fulfil these responsibilities, the Ministry will partner with a research institution that analyses employment policies. They will prepare an annual report to update the minimum wage. This annual report will include a proposed updated value for the new minimum wage by considering 47%-52% of the median wage. The adequacy of the minimum wage will then be evaluated.
When evaluating the annual impact of the minimum wage, a series of indicators such as the rate of poverty in employment, the rate of poverty among employees, the rate of poverty among employees receiving the minimum wage, the rate of relative poverty, inequality in salary distribution, the income inequality index, the rate of employment by age groups and by gender, the unit cost of employment, and the turnover for companies by industry sectors.
The annual report will be presented to the National Tripartite Council for Social Dialogue for negotiations between employers and unions every October. The final decision will be adopted as a Government Decision effective the following January. This procedure is expected to be done for the first time this year, with the first report to be finalised in October 2025.
As of 1 January 2025, the minimum wage in Romania is RON 4,050 (approximately EUR 814, USD 860) reaching the lowest suggested level of 47% of the median wage.
Practical point
Since the mechanism used for the annual report to update the minim wage value is complex, some of the factors to consider might show that the suggested level is low, which may lead to a recommendation of a higher increase in minimum wage in the second part of this year. The conclusions of the annual report should be considered when budgeting for salary costs in the future.
