Minimum Wage 2027: Second Round Fails, Decision August 18

Serbia’s Finance Ministry is proposing that the 2027 minimum wage come to 405 dinars an hour, a rise of 34 dinars, or 9.2 percent, over the current 371 dinars. The negotiating team’s second meeting, held on August 12, ended without an agreement, so the decision on the minimum cost of labor now moves to a session of the Socio-Economic Council on Tuesday, August 18.

The government’s offer was presented by Dragan Todorović, a member of the negotiating team representing the Confederation of Autonomous Trade Unions of Serbia (SSSS).

The government of Serbia has proposed an increase of 9.2 percent, from 371 dinars an hour to 405 dinars

The working group, made up of representatives from the Serbian government, the representative trade unions and the Employers’ Union, wrapped up its work the same day. “A final resolution is expected next week, when the social partners should agree on the percentage of the increase,” Todorović said.

How Much Is 405 Dinars an Hour by the End of the Month?

The proposed 405 dinars an hour works out to 70,470 dinars (about 600 euros), but only when calculated over 174 working hours, the monthly average. Pay is calculated, however, according to the actual number of working hours in a given month, so the total varies even though the hourly rate stays the same:

• a month with 160 working hours: 64,800 dinars
• a month with 174 working hours: 70,470 dinars
• a month with 176 working hours: 71,280 dinars

The 70,470 dinar figure is, in other words, an average calculation, not the amount that would land in the account every one of the twelve months. For a 176 hour month, the difference from the current rate comes to 5,984 dinars.

This is a net hourly rate: the 2026 minimum cost of labor is 371 dinars net per hour, so the proposed 405 dinars would also apply as a net figure. The Finance Ministry’s proposal has not been adopted yet and is tied to taking effect on January 1, 2027.

Three Figures on the Table

Unions are demanding a minimum wage of 650 euros and insisting on a double digit percentage increase. Employers estimate the economy can absorb an increase of around 8 percent and are seeking measures to soften part of that cost, chiefly for small businesses, entrepreneurs and employers with large numbers of workers on the lowest pay. The Finance Ministry’s 9.2 percent proposal sits between the two demands.

The union side also wants minimum wage growth to keep pace with other wages, especially in the public sector. Their argument centers on wage compression: when the minimum wage rises faster than other pay, the gap narrows between jobs of different complexity and responsibility.

Siniša Mali, first deputy prime minister and finance minister, said in early August that “the minimum wage at this moment is 65,554 dinars, or 551 euros.” Serbia’s minimum consumer basket comes to about 57,000 dinars.

The Deadline Is September 15

Negotiations over next year’s minimum cost of labor began on Monday, August 10, and the first round also ended without a deal. We reported on the 405 dinar per hour proposal and the unions’ demand for 650 euros on August 11.

The Socio-Economic Council has a legal deadline of September 15 to reach an agreement. If it fails to do so, the Labor Law puts the decision on the minimum wage in the hands of the Serbian government, acting on a proposal from the Finance Ministry. Whatever the new hourly rate turns out to be, it takes effect on January 1, 2027.

Tuesday, August 18, is therefore the first point at which it becomes clear whether the social partners are heading toward an agreement or toward a government decision. All three sides will state their position at the council session, and only then will it be clear whether the gap between 8 percent and a double digit demand has been bridged.