Minimum wage increase announced

IMPACT – MEDIUM

What is the change? Venezuelan President Nicolás Maduro has announced that minimum wage rates will increase from 3,000,000 bolivars per month (about US$12) to 180,000,000 bolivars (about US$724).

What does the change mean? The announced changes equate to a 5,900 percent increase in minimum wages for all workers in Venezuela, including foreign workers.

• Implementation time frame: The new minimum wage rates were announced by Maduro, but no official changes have been published.
• Visas/Permits Affected: Work permits.
• Who is Affected: Employers that compensate workers at rates below the new monthly minimum.
• Business Impact: Businesses must make sure they are in compliance with the new wage rates.

Background: Venezuela is suffering from massive inflation (approaching 1 million percent), and the announced increase to the minimum wage will be the latest in a series of increases made by President Maduro.

BAL Analysis: Employers should factor the new minimum wages into their budgets for all employees, including foreign national employees. The change will have minimal impact on companies employing workers who already make more than 180,000,000 bolivars per month.

This alert has been provided by the BAL Global Practice group and our network provider in Venezuela. For additional information, please contact your BAL attorney.

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