Minimum wage hike could cut net pay

Thousands of workers could be significantly out of pocket as a result of the proposed minimum wage increases due to an anomaly created by the abolition of the €100 weekly PRSI allowance three years ago.

Fianna Fáil finance spokesperson Michael McGrath said the suggested 50c pay rise would likely have a knock-on effect on those earning just above the minimum wage which could see workers’ net pay reduced by hundreds of euro.

Those earning just under €9.40 an hour — the cut-off point at which PRSI is paid — whose income rose to €9.60 would pay €749 more PRSI per annum and reduce their take home pay by €436 a year. Up to 120,000 workers could be affected, to varying degrees, by the anomaly which acts as an incentive to reduce the number of hours per week they work, Mr McGrath said.