Salary Board Recommends Minimum Wage to Minister

The Salary and Remuneration Advisory Board, on 20 February 2020, published a report on recommendations to the Minister of Economic Development on setting the National Minimum Wage.

Based on studies conducted which focused on two approaches – the needs based approach, and the balanced approach – the Salary and Remuneration Advisory Board found that the national minimum wage was determined to be between MRF 5,000 and MRF 8,000. After giving consideration to the impact of minimum wage on the cost of business for enterprises in the Maldives, the Board advised the Minister of Economic Development to set the national minimum wage at MRF 6,400. The minimum wage recommended by the Board is intended to be set as the Employees basic salary – excluding any allowances provided by their employer.

The Board also recommended that the national minimum wage should initially include Maldivians only. Citing economic concerns for which additional studies must be carried out, the Board recommended that the Minister determine a moratorium period between 1 and 2 years for expatriate workers before including them in the national minimum wage. The Board also recommended that national minimum wage be determined based on sectoral differences, i.e. for the tourism sector and state institutions. The Board estimated that the minimum wage for those sectors would be between MRF 6,400 and MRF 8,600.

Additional recommendations given by the Board include setting up a complaints procedure for employees that are deprived of minimum wage, penalties for non-compliance, and other compliance related mechanisms to ensure conformity with minimum wage requirements.