Minimum wage in Jordan to go up to $366.7 at onset of 2021

AMMAN - The tripartite committee for work affairs on Monday decided to increase Jordan’s minimum wage to JD260 as of January 1, 2021.

The decision was made to give the employers a chance to rearrange their financial affairs and list the needed allowances in their budgets to be able to implement the decision.

During the meeting, the committee agreed that the new minimum pay will be subject to social security deductions as of the beginning of the next year, and will abide by the annual salary increase in minimum wages, adjusted to inflation, which will go into effect as of January 1, 2022.

The committee also identified a fixed minimum wage-setting mechanism to determine annual adjustments, the Jordan News Agency, Petra, reported on Tuesday.

A consensus was made on raising foreign workers’ minimum wages to JD230 as of January 1, 2021, while the pay gap between Jordanian and foreign workers will be narrowed by 50 per cent after the first year and 50 per cent after the second to maintain the competitiveness of Jordanian workers.

The decision excluded domestic foreign workers and workers in the loading/unloading sector, in addition to Jordanian and non-Jordanian labourers in garments and textiles industries.

Currently, minimum wage is set at JD220 per month. The minimum wage differs from the equilibrium wage, which is determined by the supply and demand forces in the market. Usually, the employer may pay the worker higher, but not less, than the minimum wage.