Restaurateurs Angered By Proposed Increase To Minimum Wage

The Restaurants Association of Ireland (RAI) has expressed alarm and anger regarding proposals by the Low Pay Commission to increase the National Minimum Wage by 50 cent to €9.15.

The National Minimum Wage in Ireland was introduced under the National Minimum Wage Act 2000. It currently stands at €8.65 per hour.

An increase of 50 cent in the minimum wage will have a disproportionate negative impact on restaurants outside of the Greater Dublin Area. Excluding car sales, economic activity in Ireland is still very fragile.  Adrian Cummins Chief Executive of the RAI commented, “An increase in the National Minimum Wage will have a devastating effect on the Restaurant Sector and will lead to cut in hours and job losses. Ireland will have the second highest minimum wage in Europe after Luxembourg and our competitiveness will be destroyed.”

The RAI’s submission to the Low Pay Commission sets out the key arguments;

• Ireland has one of the highest minimum wage packets on the planet (fourth highest).
• An increase in the minimum wage will stifle job creation.
• The last increase in the minimum wage was in 2007, before the recession. Now is not the time to increase the minimum wage.  We will lose competitiveness if there is an increase.
• An increase in the minimum wage would have a disproportionate negative impact on restaurants outside of the Greater Dublin Area. Economic activity in rural Ireland is still very fragile.
• Excessive wage growth fuelled the Irish economic bubble and helped undermine the competitiveness of the economy. This ultimately contributed to the collapse of the economy from 2008 onwards.

 

Given the still fragile nature of Ireland’s recovery and the difficult environment for the Restaurant sector, increasing The National Minimum Wage which would have a push through effect on wages up the line, does not make any sense.  Mr Cummins commented. “I have spoken to members across the country and they were in a state of disbelief that there was talk of increasing wages when restaurants are struggling to keep their doors open.”  An increase in the Minimum Wage will stifle job creation and cause further emigration at a time when youth unemployment stands at 21.6%.