After the defeat in the formation of the council that will draft the proposal for the new Constitution of Chile, the government of Gabriel Boric won yesterday a victory in another issue of strong social appeal. The Chamber of Deputies approved the readjustment of the minimum wage in the country.

The bill, which will now be discussed in the Senate, defines a gradual increase that will raise the value by 25%, from the current 400,000 Chilean pesos (about R$2,500) to a total of 500,000 (about R$3,130). In Brazil, the minimum amount is R$ 1,320.

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It was decided that, as of May 1, 2023 – therefore retroactively – the minimum wage will be 440,000 pesos (R$ 2,750) for male and female workers aged 18 to 65. As of September 1, 2023, the amount rises to 460,000 pesos (R$ 2,880). The last readjustment will be on July 1, 2024, for 500 thousand pesos (R$ 3,130). For workers under 18 and over 65, the minimum is 328,230 pesos (R$2,050).

The project also defines measures to protect the minimum wage from inflation. If the Consumer Price Index (CPI) exceeds 6% throughout 2023, the minimum amount will be readjusted in advance to 470,000 pesos (R$2,940) as of January 1, 2024.

In the Economy Committee, the last instance in which the project was debated before going to the plenary vote, some deputies defended the rejection of the project, claiming that the government should first sew an agreement with micro, small and medium-sized companies that are not satisfied with the current text.

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But Labor Minister Jeannette Jara said it makes no sense to demand unanimity from companies or ask employers for permission to raise the minimum wage. Political disputes, she argued, cannot be at the expense of the country’s workers.

However, to offset the impact that the increase in the minimum wage will have on companies’ finances, the project provides for a tax subsidy to benefit micro, small and medium-sized companies. The fiscal waiver by the government will be 311 billion pesos, which is equivalent to almost R$ 2 billion. The value can be increased in specific cases of deterioration of the economic scenario.

workload reduction

Last month, the Boric government had won another victory in Congress, with the approval of a reduction in working hours from 45 to 40 hours a week. The decrease will be implemented gradually over the next five years. With this measure, Chile formally adopts a recommendation from the International Labor Organization (ILO) and becomes the second country in Latin America with the lowest workload, next to Ecuador — the Brazilian one is 44 hours a week.

Editing: Thalita Pires


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