Montenegro adopts ‘Euro model’ to raise minimum wages

The Montenegrin government has adopted a new wage calculation system known as the ‘Euro model’, set to be implemented in January 2027. Prime Minister Milojko Spajić announced that the model will establish mandatory minimum net wages based on education levels: 1,000 euros for positions requiring basic or lower education, 1,250 euros for secondary education, and 1,400 euros for higher education.

The reform aims to combat the country’s history of low wages and prevent the exodus of young citizens. The government has passed a set of laws to facilitate this transition, which is part of broader economic reforms aligned with Montenegro’s EU integration process. The model is expected to affect over 250,000 employees across both public and private sectors.

Additionally, the government announced plans to adjust pensions four times a year starting in 2027. The minimum pension is projected to rise to 500 euros, while the average pension could exceed 600 euros. Funding for these measures is expected to come from increased employment, curbing the shadow economy, fiscal discipline, and new tax measures, including a potential tax on vacant tertiary real estate.