
(Credit: Unsplash)
Today, the Commission launches the second-stage consultation of European trade unions and employers’ organisations on how to ensure fair minimum wages for all workers in the European Union. This follows the first-stage consultation which was open from 14 January to 25 February 2020, to which the Commission received replies from 23 EU-wide social partners. Based on the replies received, the Commission concluded that there is a need for further EU action. Already a political priority for the von der Leyen Commission, recent events have further cemented demand for EU efforts to reduce rising wage inequalities and in-work poverty. The EU has been particularly hit by the coronavirus pandemic, with negative effects on Member States’ economies, businesses, and the income of workers and their families. Ensuring that all workers in the EU earn a decent living is essential for the recovery as well as for building fair and resilient economies, and minimum wages have an important role to play.Minimum wages are relevant both in countries relying solely on collectively agreed wage floors and in those with a statutory minimum wage. Minimum wages that are appropriately negotiated with social partners, complied with and updated can:
- Provide vulnerable workers with a financial buffer in case of hard times
- Create greater incentives to work, thereby improving productivity
- Reduce wage inequalities in society
- Increase domestic demand, and the resilience of the economy
- Help close the gender pay gap
- Well-functioning collective bargaining in wage-setting is in place;
- National frameworks allow for statutory minimum wages to be set and regularly updated according to clear and stable criteria;
- Social partners are effectively involved in statutory minimum wage setting to support minimum wage adequacy;
- Minimum wage variations and exemptions are eliminated or limited;
- National minimum wage frameworks are effectively complied with and monitoring mechanisms are in place.
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