Last updated: 13 December 2022
Starting with January 1, 2023, the minimum gross salary at the national level increases from 2,550 Lei per month to 3,000 Lei per month (about € 608) for a full-time job of 165.333 hours per month, namely 18.14 Lei per hour (about € 3,68), according to the Government Decision no. 1447/2022.
In the construction field, according to the GEO no. 168/2022, the minimum gross salary increases from 3,000 Lei per month to 4,000 Lei per month (about € 811). The increase of this differentiated gross salary does not apply anymore in the agriculture and food industry field, where the minimum gross wage at national level remains at 3;000 Lei per month.
The basic minimum gross salary at the national level is defined as the lowest basic salary that an employee may be granted under an individual labour agreement, for a full-time job. Establishing a basic salary under the rate provided by the Decision mentioned hereinabove represents a violation of the law and shall be punished by a fine between 300 Lei and 2,000 Lei.
In addition, according to art. 164 of the Labor Code as amended by GEO no 130/2021 and 142/2021, starting with January 1, 2022, the minimum gross salary can be applied for an employee (hired after January 1, 2022) for a period of maximum 24 months from the conclusion of the employment contract. At the end of this period, the employer must increase the gross basic salary, but the law does not provide any mandatory amount of the salary increase.
On the tax side, the income tax remains 10%, knowing that certain categories of employees, such as software developers (for the entire income) or those in the fields of construction, agriculture and food industry, remain exempt from paying this tax up to a limit of 10,000 Lei gross (about € 2,000).
In the case of employees receiving the minimum gross salary of 3,000 Lei per month, the employer only has to calculate and pay social security contributions for an amount of 2,800 Lei, the difference of 200 Lei being exempt from income tax and mandatory social security contributions, under the following conditions:
- The basic gross salary is 3,000 Lei ; the basic gross salary must not be decreased during the period 09.12.2022 (date of entry into force of the OUG no. 168/2022) and 31.12.2023 ;
- The gross monthly income of the employee (thus including a possible bonus, compensation for overtime etc.) does not exceed 4,000 Lei.
The tax due by employees is calculated, withheld, declared, and paid by the employer to the state budget.
Please find below the table of the social security contributions applicable in 2023:
EMPLOYEES’ CONTRIBUTION | DECEMBER 2022 | JANUARY 2023 |
State Social Security Insurance (CAS) – Retirement (1) (2) | 25% | 25% |
Health Insurance (3) | 10% | 10% |
TOTAL (1) | 35% | 35% |
EMPLOYERS’ SOCIAL SECURITY CONTRIBUTIONS | DECEMBER 2022 | JANUARY 2023 |
Work insurance contribution (4) | 2.25% | 2.25% |
TOTAL (2) | 2.25% | 2.25% |
TOTAL (1) + (2) | 37.25% | 37.25% |
(1) This rate includes the 3,75% rate for the privately administrated pension fund ; according to the legislation, a person contributing to the privately administrated pension fund may opt, after a 5-year participation in this fund, to continue to pay their 3,75% contribution to this fund or to direct it to the public pension system. It should also be noted that in the specific case of employees working in the construction field or agriculture or food industry the CAS rate is reduced by 3,75% (the contribution to the private managed pension fund) to 21,25%, for the period 01.01.2019 to 31.12.2028.
(2) From January 1st, 2018, for work under special conditions, respectively under special conditions, the employer must pay a CAS contribution of 4%, respectively 8% of the gross income obtained by the employee.
(3) Employees in the construction, agriculture and food industry are exempt from paying social health insurance contributions.
(4) Employers operating in the field of construction and some related fields, agriculture and food industry are exempted from paying the standard labor insurance contribution of 2,25%, for employees exempted from paying tax.