The Employers Federation of Montenegro has put forward a proposal for minimum wages ranging between €800 and €1,000 starting January 1, 2027. This initiative presents an alternative to the government’s Euro Model and includes a comprehensive set of measures aimed at safeguarding business liquidity and investment.
The federation has outlined 13 proposals designed to mitigate the effects of increased labor costs on employers. A significant aspect of the proposal is a request for a transition period of up to 12 months, particularly beneficial for micro and small enterprises that may find it difficult to accommodate sudden payroll hikes.
Additionally, the employers are advocating for a 24-month freeze on new or increased state and municipal charges. The proposed package also suggests allowing corporate income tax liabilities to be settled in six monthly installments, modifications to sick-leave reimbursement practices, and streamlined procedures for hiring foreign workers.
While these proposals represent the most comprehensive employer counteroffer to Montenegro’s planned wage reforms, they remain recommendations and have yet to be accepted by the government.
Business representatives have consistently expressed support for higher wages but emphasize that any increases should correlate with productivity gains and be accompanied by reductions in other operational expenses.
The potential impact is particularly pronounced in labor-intensive sectors such as tourism, retail, manufacturing, and municipal services. Companies operating with slim profit margins may struggle to manage increased payroll costs without resorting to price hikes, workforce reductions, or deferred investments.
A temporary suspension of state and local charges could help alleviate some of this financial pressure. Furthermore, allowing corporate income tax payments in installments would enhance short-term liquidity for smaller businesses.
Montenegro now faces critical policy decisions regarding how to elevate household incomes while maintaining business competitiveness. The government’s initial wage proposal aims for significantly higher minimum salaries, whereas employers are advocating for a more gradual adjustment alongside tax and regulatory relief.
The proposed range of €800–€1,000 signifies a shift in discourse from whether wages should increase to how much of this adjustment can be sustainably managed by businesses and public finances.
