Minimum Wage in Croatia – Frequently Asked Questions
Is there a separate legislation relating to minimum wages in Croatia?
In Croatia, the Minimum Wage Act defines the way the level of the minimum wage is determined, the relevant deadlines, as well as the supervision of the law implementation. The current Act is in force since April 11, 2013 (published in the Official Gazette No. 39/13).
Do one or more minimum wages exist that is/are determined by law?
Only one minimum wage is determined by law in Croatia.
At what level is minimum wages determined at?
The minimum wage is determined at the national level. The minimum wage amount is determined on an annual basis, by Government's Decree (Uredba Vlade Republike Hrvatske). The minimum wage legislation applies to all workers in Croatia, regardless of the fact that the employment contract, collective agreement, company by-law or any other employer's act prescribes a lower amount for payment. Regardless of the seat or registration of the employer, all workers in Croatia are entitled to the minimum wage.
On what basis is minimum wage calculated?
The minimum wage is calculated on a monthly basis in Croatia. More specifically, the level of the minimum wage is determined by Government Decree every year for the following year (Uredba o visini minimalne plaće). Currently, the gross minimum wage in Croatia amounts to HRK 3.017,61 (for 2014). The minimum wage for a current year cannot be lower than the previous year (Article 7 of the Minimum Wage Act). Exceptionally, the collective agreement may stipulate the minimum wage at a lower amount that foreseen in the Act, but not lower than 95% of the amount prescribed by the Government Decree (Article 8 of the Minimum Wage Act).
In case of weekly/monthly minimum wage, are they based on any fixed number of hours?
The Minimum Wage Act defines the minimum wage as the lowest amount of the gross wage pertaining to a worker for the full-time work (Article 2). The Croatian Labor Act defines full-time working hours as not exceeding 40 hours per week (Article 43).
Are governmental bodies, employer and/or trade union representatives involved in minimum wages setting?
As per Article 7 of the Minimum Wage Act, Government decides after tripartite or bipartite body discussions/recommendations. The Croatian Employers' Association, the Union of Autonomous Trade Unions of Croatia. The Minimum Wage Act stipulates that social partners will be consulted during the process (Article 7, paragraph 3 of the Minimum Wage Act). The minister in charge of the labor affairs will propose the amount of the minimum wage to the Croatian Government. Based on this proposal, after hearing the recommendations and proposals of the Economic and Social Council of Croatia about the coordination of the salary policy, the minimum wage is determined by the Government of the Republic of Croatia.
How are upratings (adjustments) of minimum wage/s decided upon?
As per Article 7 of the Minimum Wage Act, the minister in charge of the labor affairs will consult with the social partners, and suggest the level of the minimum wage to the Government. Based on the minister's suggestion, the minimum wage is determined by the Government of the Republic of Croatia.
Which are the components of minimum wage in Croatia?
The minimum wage is determined by the Government decree on an annual basis.
How frequently is the fixed component of minimum wage updated?
Fixed component of minimum wage is updated annually.
What is/are the yardstick/s on which minimum wage upratings are based?
The current legislation (Minimum Wage Act of 2013) prescribes the criteria for determining the basis for the minimum wage calculation (Article 5(2)). The base for the calculation of the minimum wage is determined according to the monthly poverty threshold for a single household, coefficient of the number of people in relation to the number of households and in relation to the number of active persons and the change in the average index of consumer prices of goods in 2012 as compared to 2011.
What is National Poverty line?
How is minimum wages compliance regulated?
As stipulated in Article 9 of the Minimum Wage Act, the law enforcement will be audited by authorized inspection bodies in charge of labour and employment inspections. The minimum wage calculations and payments validity, legacy and related payment deadlines will be subject of audit by authorized inspection bodies within Ministry of Finance.
Which legal sanctions can be applied in compliance is lacking?
Article 10 of the Minimum Wage Act prescribes penalties for non-compliance. The penalties amounting between HRK 60,000 HRK and HRK 100,000 are prescribed for legal entities which do not pay out prescribed minimum wages within prescribed deadlines, in accordance with the law (paragraph 1). Penalties amounting between HRK 7,000 and HRK 10,000 HRK are prescribed for employers which are physical persons, as well as for companies’ official representatives (paragraph 2 of the Act). The same article defines that the fines for legal entities can be increased, in proportion to the number of workers for which the compliance is lacking.
Are sanctions often being applied?
No official data is available.
Are employer and/or trade union representatives involved in compliance procedures?
No, the supervision of the compliance is conducted by state administration bodies (Article 9 of the Minimum Wage Act).
To whom/Where can individuals complain, if they think they are earning less than minimum wage?
Not specifically determined in the legislation.
Which month of the year is minimum wage rate revised in Croatia?
December, for the following year.