Setting and asjusting minimum wage levels


In France, annual minimum wage adjustments are linked to the evolution of the CPI, as well as to the increase in the purchasing power of blue-collar workers’ basic hourly wage. The minimum wage adjustment takes place every January. It incorporates the change in the CPI over 12 months (November t-2 to November t-1).

The annual revision of the minimum wage also incorporates half the annual increase in the hourly basic rate of blue collar wages (from September t-2 to September t-1), resulting from a specific survey carried out quarterly by the Ministry of Labour.

France’s formula is:

∆ MWt = ∆ CPI Nov t-2/Nov t-1 + 0.50 * ∆ Blue collar hourly wage Sep t-2/Sep t-1

France’s minimum wage also has an automatic guarantee concerning the evolution of prices. This adjusts the minimum wage every time the price index increases by 2 per cent or more since the last adjustment.

In addition to this mathematical determination of minimum wage adjustments, France also has a discretionary component that can introduce an additional percentage to the final increase. Since 2009 a commission of independent experts recommends if there is space for an additional increase (coup de pouce), taking into account the economic context.