Salary Compensation of Rs 635 - Business Mauritius: "Not all sectors have the same absorption capacity"

Business Mauritius has officially responded to the government's announcement of a salary compensation of Rs 635 starting in January 2026 for employees earning up to Rs 50,000.

"We acknowledge the government's efforts to support households' purchasing power, especially as the cost of the consumption basket continues to rise. The announced adjustment will represent a significant effort for many businesses, with varying impacts depending on sectors and the size of the operators," stated Business Mauritius, the representative of employers, on Friday, December 12.

The employer federation emphasizes that not all sectors have the same capacity to absorb this change. While large companies may adapt relatively well, SMEs, manufacturing, BPO, retail, and construction will face major financial constraints. "Clarification regarding potential specific measures for the exposed sectors would be welcome in this context," recommends Business Mauritius.

In total, 409,400 employees will receive this compensation:

• 89,100 in the public sector

• 320,300 in the private sector

This accounts for 88% of the total workforce in Mauritius.

The annual cost of this compensation is estimated at Rs 3.38 billion, which includes:

• Rs 740 million for the state

• Rs 2.64 billion for the private sector