1. Starting on 01.01.2019, according to GD 937/2018, the minimum gross wage has increased from 1,900 RON to 2,080 RON for a full time employment.
For the personnel emplyed in positions that require a level of higher education, with a work experience of at least one year in the field, the minimum gross wage will be 2,350 ron for full-time work.
|Gross/ron||Net/ron||Total cost for employer/ron|
|Gross/ron||Net/ron||Total employer expense/ron||Net difference versus 2018/ron||Cost difference for the employer /ron|
The deadline for reporting in Revisal the gross minimum wage changes is 20 working days from the date of its effects, hence until 31.01.2019.
Increasing the minimum wage affects employers with minimum 50 employees especially by increasing the disability fund they pay monthly.
The disability fund is related to the minimum wage, so with the increase of the minimum wage, the contribution to the disability fund also increases.
The formula for disability fund is: ((average number of employees * 4%) – number of disabled people employed) * minimum wage.
2. Starting on 01.01.2019, GEO no. 114/2018 brings specific salary changes in the field of construction, namely:
- The minimum gross wage is 3,000 RON;
- Income from salaries ranging from 3,000 to 30,000 gross, made in the construction sector, are exempt from income tax, provided that 80% of the employer’s turnover is made from activities in constructions included in the specially regulated CAEN codes;
- Social security contribution rates (pension contribution) is reduced from 25% to 21.25%
- They are exempted from the payment of the contribution to the privately administered pension fund regulated by Law no. 411/2004;
- They are exempted from paying the social health insurance contribution;
- Work insurance contribution paid by employer decreases from 2.25% to 0.3375%;
- The changes take effect for a period of 10 years, comprised between 01.01.2019 and 31.12.2028.
Below, we have the difference between a normal 3.000 gross salary and an employee in construction with the minimum wage.
|Normal employee||employee in construction|
|Gross wage (SB)||3.000 ron||3.000 ron|
|Pension contribution||= SB*25% = 750 ron||= SB*21.25% = 638 ron|
|social health insurance contribution _10%||300 ron||exempted|
|income tax _10%||176 ron||exempted|
|Net Wage||1.774 ron||2.362 ron|
|Work insurance contribution paid by employer||= SB*2.25% =68 ron||= SB*0.3375% =10 ron|
|Employer’sTotal cost||3.068 ron||3.010|
|Total taxes||1.294 ron||648 ron|
3. Starting on 01.01.2019, GEO no. 114/2018 brings amendments to the Law 152/2011 regarding day labourer, namely:
- The maximum number of days one person can perform as a day labourer increases from 90 days to 120 days within one year, regardless of the number of beneficiaries;
- One person can perform as a day labourer for the same beneficiary for a maximum of 25 calendar days on a continuous basis. If the activity requires it, the beneficiary will turn the day labourer into an employee with an employment contract for a definite period;
- The list of fields that are subject to casual work reduces, namely, the work using day labourer can be done in the following areas:
– agriculture, hunting and related services – division 01;
– silviculture, except for forestry – Division 02;
– Fisheries and aquaculture – Division 03.
4. Starting on 01.01.2019, GD 714/2018 establishes the delegation allowance, in the amount of 20 ron / day, irrespective of position and of the public authority or institution in which it operates. Hence, the deductible allowance is 50 ron / day, ie 2.5 times the legal level established.
5. As of 01.01.2019, the social health insurance contribution for IT employees is no longer calculated according to the formula established by GEO no. 3/2018. GEO no. 3/2018 was only valid in 2018. So starting 01.01.2019, the only benefit left to IT employees is the exemption from income tax on salaries.
6. According to Law 247/2018, available from 10.11.2018, foreigners may be employed with full-time employment contract and with the minimum gross wage guaranteed by country, and for highly qualified foreigners the salary must be at least twice the average gross salary.
Gabriela is a HR expert with more than 10 years experience