When talking about the labour market certain themes are avoided by both employers and employees. One of such things is so-called ‘envelope salaries.’ That is to say, cash-in-hand work. The statistics are striking. Unofficial, or off the book, salaries are not rare cases. Approximately half of the Lithuanian labour market receive their wages “in envelopes”, ekonomika.lt reports.
This data was disclosed by the job search portal CVbankas.lt which conducted a survey of a number of individuals in employment in Lithuania. Despite 55 percent of those surveyed claiming they had never received an “envelope salary” the rest admitted they have encountered such situations. Another tenth admitted receiving “envelope salaries” regularly.
The opinions of those in receipt of such clandestine salaries differ greatly. Some claim it is an unfavourable tendency of the labour market which does in fact have negative consequences on both employees and the Lithuanian economy. According to those surveyed by CVbankas.lt it is necessary to take into account the social guarantees given to those who declare their official income and pay taxes. It is also crucial for those in the labour market to critically assess individual employment situations in order that employers do not abuse their positions by forcing their employees to accept “envelope salaries.”
Another group of respondents regarded “envelope salaries” as positive. According to them it is better to receive a larger sum of money, even if through unofficial channels, and a smaller official salary or none at all. This is largely due to their own poor financial circumstances. According to the respondents’ opinions, employers as well as employees are forced to pay illogical taxes. Both subsequently believe it to be more beneficial to receive an unofficial income than to pay the difference in tax.
The final group of respondents saw both positive and negative aspects to such unofficial salary arrangements. As a result, they neither justified nor condemned those who pay and those who receive “envelope salaries.” Unofficial salaries exclude one from social security guarantees but in turn allow the individual to earn more in comparison to official channels. However, this final group of respondents admitted they wouldn’t agree to provide labour in exchange for an “envelope salary.”
Edited by Rachel Croucher