Approximately 55,000 employees in Cyprus are awaiting the outcome of consultations that began yesterday between the Labour Minister and social partners regarding the revision of the national minimum wage.
An increase is certain to take effect starting from January 2026, according to recent statements by Labour Minister Yiannis Panayiotou, who noted that as the economy performs positively, those on the minimum wage should benefit.
The initial meeting was largely procedural, focusing on defining the parameters and timelines for the consultation. However, much like the negotiations over the Cost of Living Allowance (CoLA), difficulties are anticipated in reaching a compromise between trade unions and employer organisations. The crucial difference in this case is that the final decision rests solely with the Council of Ministers, which will determine the minimum wage level through a relevant decree.
Five parameters and EU recommendations
The framework for the revision has confirmed five key parameters that will guide the consultation:
- Consumer purchasing power combined with the cost of living.
- The level of employment and the rate of unemployment.
- The country’s rate of economic growth and productivity.
- Employee earnings and their distribution.
- Poverty levels and competitiveness.
The discussions are framed by the relevant EU Directive, which recommends that member states use reference values to assess the adequacy of the minimum wage, such as 60% of the gross median wage and 50% of the gross average wage.
Current data (as of 30/10/2025) published by the European Trade Union Confederation (ETUC) shows that Cyprus’s minimum wage currently stands at 53% of the national median wage (which was €1,881 in 2024).
Positions and timetable
- Trade unions: Are aiming to increase the minimum wage to 60% of the national median wage.
- Employer organisations: View the 60% rate as excessive compared to more developed EU countries. They plan to push for a specific formula based on (a) economic growth, (b) productivity, and (c) unemployment and inflation rates.
A total of four meetings are scheduled. The social partners are expected to submit their proposals at the third meeting, scheduled for 5 December. The final phase of the consultation will follow, with the definitive decision expected by the end of December to ensure the new wage is effective from 1 January 2026.
Current minimum wage in Cyprus
Since 1 January 2024, the gross monthly minimum wage in Cyprus has been set at €1,000 for full-time employment. However, for employees who have not completed six months of continuous employment with the same employer, the rate is set at €900 for the first six months.
The provisions do not apply to domestic workers, agricultural workers, shipping employees, or those covered by the minimum wage in the Hotel Industry Decree of 2025.
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