Restaurants Association of Ireland (RAI) has come out in opposition of an increase in the national minimum wage.
Instead, the RAI has proposed a reduction of the Universal Social Charge (USC) for employees.
The minimum wage in Ireland was introduced under the National Minimum Wage Act 2000 and currently stands at €8.65 per hour.
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The RAI believes an increase in the minimum wage will have a "disproportionate negative impact" on restaurants outside of the greater Dublin area.
Adrian Cummins, chief executive of the RAI commented, "If the desire of the Government and the Oireachtas is to ensure people have more disposable income in their pocket at the end of the week, that they are able to support themselves and their families, then I suggest we look at what emanates from elsewhere in the Oireachtas; the most direct way to increase take-home pay is to reduce the excessive burden of taxation and the controversial USC on employees.”
The RAI’s submission to the Low Pay Commission sets out its key arguments against the move:
- Ireland has the one of the seventh highest minimum wage packets in the world.
- An increase in the minimum wage will stifle job creation.
- The last increase in the minimum wage was in 2007, before the recession. Now is not the time to increase the minimum wage. We will lose competitiveness if there is an increase.
- An increase in the minimum wage would have a disproportionate negative impact on restaurants outside of the Greater Dublin Area. Economic activity in rural Ireland is still very fragile.
- Excessive wage growth fuelled the Irish economic bubble and helped undermine the competitiveness of the economy. This ultimately contributed to the collapse of the economy from 2008 onwards.
"I have spoken to members across the country and they were in a state of disbelief that there was talk of increasing wages when restaurants are struggling to keep their doors open," added Cummins.