Iran raises minimum wage in concession to workers

Al Monitor | : Following intense tripartite negotiations, the Iranian government, employers and unions agreed to increase the country’s minimum wage by 19.8%, from 9.29 million rials ($245) per month to 11.14 million rials ($294.50). The deal will see the highest year-on-year growth in real terms since 2002.

Workers and labor unions have scored this victory as the Iranian economy still reels from a recent downturn and as the threat of new sanctions looms.

This year’s minimum wage negotiations were more protracted and animated than usual. According to insiders, employers’ organizations initially opposed any wage increase. Iran’s private sector argued that a higher minimum wage would dampen investment, citing the high costs of labor as well as the uncompetitive and state-dominated nature of the Iranian economy and out-of-control smuggling.

On the other hand, labor representatives came to the table demanding a 36% raise. The eventual figure was reached only when the Ministry of Labor threw its weight behind union delegates.

In Iran, the minimum wage is set annually in February or March, just before the end of the Iranian New Year, which fell on March 20 this year. The tripartite negotiations officially involve a nine-member committee with seats divided equally between the Ministry of Labor, unions and employers’ organizations.

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