BETA


Events

2022/10/25
   Final act published in Official Journal
Details

PURPOSE: to improve living and working conditions in the EU, in particular the adequacy of minimum wages for workers in order to contribute to upward social convergence and reduce wage inequality.

LEGISLATIVE ACT: Directive (EU) 2022/2041 of the European Parliament and of the Council of 19 October 2022 on adequate minimum wages in the European Union.

CONTENT: this Directive establishes a framework for:

- adequacy of statutory minimum wages with the aim of achieving decent living and working conditions;

- promoting collective bargaining on wage-setting;

- enhancing effective access of workers to rights to minimum wage protection where provided for in national law and/or collective agreements.

The Directive will be without prejudice to:

- the full respect for the autonomy of the social partners, as well as their right to negotiate and conclude collective agreements;

- the competence of Member States in setting the level of minimum wages, as well as to the choice of the Member States to set statutory minimum wages, to promote access to minimum wage protection provided for in collective agreements, or both.

Procedure for setting adequate statutory minimum wages

Member States with statutory minimum wages will establish the necessary procedures for the setting and updating of statutory minimum wages . Such setting and updating will be guided by criteria set to contribute to their adequacy, with the aim of: (i) achieving a decent standard of living, (ii) reducing in-work poverty, as well as (iii) promoting social cohesion and upward social convergence, and (iv) reducing the gender pay gap.

Updates of statutory minimum wages will take place at least every two years (or at the latest every four years for those countries which use an automatic indexation mechanism).

To guide their assessment of the adequacy of statutory minimum wages, Member States may use indicative reference values commonly used at international level , such as 60% of gross median wage and 50 % of the gross average wage, and/or indicative reference values used at national level.

Promotion of collective bargaining for wage-setting

Member States, with the participation of the social partners and in accordance with national law and practice, will:

- promote the capacity of the social partners to engage in collective bargaining for wage-setting;

- take measures, where appropriate, to protect the exercise of the right to collective bargaining and to protect workers and trade union representatives against acts of discrimination in employment on the grounds that they are participating or wish to participate in collective bargaining for wage fixing.

Where collective bargaining coverage is below a threshold of 80% , Member States will establish an action plan to promote collective bargaining. The action plan should set out a clear timetable and specific measures for progressively increasing collective bargaining coverage.

Member States will take the necessary measures to ensure that the social partners are involved in setting and updating statutory minimum wages.

Effective access of workers to statutory minimum wages

The Directive provides that Member States will take the following measures to enhance the effective access of workers to statutory minimum wage protection. These measures include:

- controls by labour inspectorates;

- easily accessible information on minimum wage protection and;

- developing the capability of enforcement authorities to prosecute non-compliant employers.

Right to redress and protection against adverse treatment or consequences

Workers and workers’ representatives, including those who are trade union members or representatives, will be in a position to exercise their right of defence when their rights relating to minimum wage protection are provided for in national law or collective agreements and have been violated.

Member States will take the necessary measures to ensure that workers have access to effective, timely and impartial dispute resolution and a right to redress, as well as effective judicial and/or administrative protection from any form of detriment, if they decide to exercise their right of defence.

This Directive will not constitute valid grounds for reducing the general level of protection already provided to workers within Member States, in particular with regard to the lowering or abolition of minimum wages.

ENTRY INTO FORCE: 14.11.2022.

TRANSPOSITION: no later than 15.11.2024.

2022/10/20
   EC - Commission response to text adopted in plenary
Documents
2022/10/19
   CSL - Draft final act
Documents
2022/10/19
   CSL - Final act signed
2022/10/04
   EP/CSL - Act adopted by Council after Parliament's 1st reading
2022/09/14
   EP - Decision by Parliament, 1st reading
Details

The European Parliament adopted by 505 votes to 92, with 44 abstentions, a legislative resolution on the proposal for a directive of the European Parliament and of the Council on adequate minimum wages in the European Union.

The proposal for a directive establishes a framework for making minimum wages more adequate and improving workers' access to minimum wage protection.

The European Parliament's first reading position under the ordinary legislative procedure amends the proposal as follows:

Framework established by the Directive

The Directive aims to improve living and working conditions in the Union with the objective of contributing to upward social convergence and reducing wage inequalities.

To this end, the Directive establishes a framework for:

- the adequacy of statutory minimum wages with a view to achieving decent living and working conditions;

- the promotion of collective bargaining for wage-setting;

- enhancing effective access of workers to rights to minimum wage protection where provided for in national law and/or collective agreements.

It is clarified that the Directive is without prejudice to the full respect of the autonomy of the social partners and their right to negotiate and conclude collective agreements. The new directive will apply to all workers in the EU who have a contract of employment or an employment relationship. Member States where the minimum wage is already protected by collective agreements will not be obliged to apply these rules or to make these agreements generally applicable.

Promotion of collective bargaining for wage-setting

To increase the coverage of collective bargaining and to facilitate the exercise of the right to collective bargaining for wage-setting, Member States, with the participation of the social partners and in accordance with national law and practice, should:

- encourage constructive negotiations on wages between the social partners on an equal footing, in which both parties have access to appropriate information to exercise their functions regarding collective bargaining for wage-setting;

- take measures, where appropriate, to protect the exercise of the right to collective bargaining and to promote collective bargaining for wage-setting.

In countries where less than 80% of workers are covered by collective bargaining, Member States, in collaboration with the social partners, should draw up an action plan to promote collective bargaining.

Procedure for setting adequate statutory minimum wages

Member States with statutory minimum wages should establish the necessary procedures for the setting and updating of statutory minimum wages. These procedures should be guided by criteria set to contribute to their adequacy, with the aim of achieving a decent standard of living, reducing in-work poverty, as well as promoting social cohesion and upward social convergence, and reducing the gender pay gap.

The national criteria should include at least the following elements: (a) the purchasing power of statutory minimum wages, taking into account the cost of living; (b) the general level of wages and their distribution; (c) the growth rate of wages; (d) long-term national productivity levels and developments.

Member States should use indicative reference values to guide their assessment of adequacy of statutory minimum wages. To that end, they may use indicative reference values commonly used at international level such as 60 % of the gross median wage and 50 % of the gross average wage , and/or indicative reference values used at national level.

Regular and timely updates of statutory minimum wages should take place at least every two years.

Enforcement system

The amended text introduces an obligation for Member States to put in place an effective enforcement system, including reliable monitoring as well as controls and field inspections, in order to ensure compliance with these rules and to combat abusive sub-contracting, bogus self-employment, undeclared overtime or health and safety risks linked to increased work intensity.

Member States will also need to take measures to (i) ensure that, in awarding and performing public contracts , economic operators and their subcontractors respect the applicable obligations concerning wages and the right to collective bargaining on wage setting; and (ii) ensure that effective data collection tools are in place to monitor minimum wage protection.

Information on minimum wage protection

Information on statutory minimum wages and minimum wage protection provided by generally applicable collective agreements, including information on redress mechanisms , should be made available to the public, where necessary in the most relevant language, as determined by the Member State, in a comprehensive and easily accessible way, including to persons with disabilities.

Documents
2022/09/13
   EP - Debate in Parliament
2022/07/11
   EP - Approval in committee of the text agreed at 1st reading interinstitutional negotiations
2022/06/15
   CSL - Coreper letter confirming interinstitutional agreement
2022/06/15
   EP - Text agreed during interinstitutional negotiations
Documents
2021/11/25
   EP - Committee decision to enter into interinstitutional negotiations confirmed by plenary (Rule 71 - vote)
2021/11/22
   EP - Committee decision to enter into interinstitutional negotiations announced in plenary (Rule 71)
2021/11/18
   EP - Committee report tabled for plenary, 1st reading
Details

The Committee on Employment and Social Affairs adopted the report by Dennis RADTKE (EPP, DE) and Agnes JONGERIUS (S&D, NL) on the proposal for a directive of the European Parliament and of the Council on adequate minimum wages in the European Union.

The proposal for a directive establishes a framework to make minimum wages more adequate and to improve workers' access to minimum wage protection.

The committee responsible recommended that the European Parliament's position adopted at first reading under the ordinary legislative procedure should amend the proposal as follows:

Framework established by the directive

According to Members, the directive should aim to improve working and living conditions in the EU for all workers, contribute to upward social convergence and reduce pay inequalities and the gender pay gap in the EU.

To this end, the Directive should establish a framework to:

- determine the adequate and fair level of minimum wages to ensure at least a decent standard of living for workers and their families;

- ensure protection offered by minimum wages , in the form of: (i) a non-discriminatory statutory minimum wage, where statutory minimum wages exist; (ii) access to collective bargaining for wage setting; and (iii) universally applicable collective agreements, where they exist.

The Directive should apply with due respect for the freedom of association and the right to collective bargaining as recognised in the Charter of Fundamental Rights of the European Union, the European Social Charter and the relevant International Labour Organisation (ILO) conventions. The social partners would retain the right to negotiate, monitor and set wages through collective agreements.

Promotion of collective bargaining for wage setting

In cooperation with the social partners, Member States should also:

- prohibit and take measures to prevent all acts which undermine the right of workers to join a trade union, or which discriminate against workers and trade union representatives participating in collective bargaining on wage setting, and ensure that all workers have appropriate access to the necessary information on their rights;

- prohibit all acts aimed at undermining collective bargaining on wage setting;

- ensure that employers provide trade union representatives with appropriate information and facilities to enable them to carry out their functions in respect of collective bargaining on wage setting;

- support compliance with applicable collective wage agreements, also along the sub-contracting chains, and the provision of collective wage agreements to employers and workers.

Action plan

Member States where the overall collective bargaining coverage regulating remuneration is less than 80% of the workers should ensure conditions conducive to the promotion of collective bargaining, in the form of an action plan, by law following consultation with and in agreement with the social partners.

The action plan should set out a clear timeline and concrete measures to effectively ensure the right to collective bargaining to promote and progressively increase the coverage of such collective bargaining to at least 80% of the workers . The action plan should be updated at least every two years, after consulting social partners, in agreement with social partners. The Commission should monitor progress and report annually to the European Parliament and the Council in this respect.

Adequacy and fairness of statutory minimum wages

Member States should ensure that statutory minimum wages are adequate and fair and guarantee a decent standard of living. Member States in which statutory minimum wages do not result from collective bargaining should put in place measures to ensure that the setting and updating of such wages contribute to combating poverty, in particular in-work poverty , to promoting social cohesion and to reducing wage inequalities.

National criteria

The setting and updating of wages should be based on criteria to ensure adequacy and fairness with the aim of creating decent working and living conditions, eliminating the gender pay gap and ensuring upward convergence , taking into account the situation of the labour market concerned.

National criteria should include: (i) the purchasing power of statutory minimum wages, taking into account the cost of living, based on a national basket of goods and services at real prices, including VAT, social security contributions and public services; (ii) the poverty rate, in particular the rate of in-work poverty.

Member States should assess and report on the adequacy of statutory minimum wages. Statutory minimum wages should be updated in a transparent way, at least once a year.

Members opposed the possibility for Member States to allow different statutory minimum wage rates for specific groups of workers or to allow statutory deductions that reduce workers' pay below the statutory minimum wage.

Monitoring compliance with the Directive

Member States that apply statutory minimum wages should increase the intensity and frequency of on-the-spot checks and inspections and ensure that sufficient resources are available to ensure that such checks and inspections are effective, dissuasive, proportionate and non-discriminatory. Members called for information to be provided in formats accessible to all, in particular to persons with disabilities, and for workers and employers to have access to mediation or dispute settlement.

Documents
2021/11/11
   EP - Vote in committee, 1st reading
2021/11/11
   EP - Committee decision to open interinstitutional negotiations with report adopted in committee
2021/11/03
   EP - Specific opinion
Documents
2021/10/11
   EP - Committee opinion
Documents
2021/09/14
   EP - Results of vote in Parliament
2021/07/01
   EL_PARLIAMENT - Contribution
Documents
2021/07/01
   EP - DZHAMBAZKI Angel (ECR) appointed as rapporteur in JURI
2021/05/19
   AT_NATIONALRAT - Contribution
Documents
2021/05/18
   EP - Amendments tabled in committee
Documents
2021/04/22
   IT_CHAMBER - Contribution
Documents
2021/04/22
   IT_CHAMBER - Contribution
Documents
2021/04/06
   EP - Committee draft report
Documents
2021/03/19
   CofR - Committee of the Regions: opinion
Documents
2021/02/11
   EP - GÁLVEZ MUÑOZ Lina (S&D) appointed as rapporteur in FEMM
2021/02/09
   EP - RADTKE Dennis (EPP) appointed as rapporteur in EMPL
2021/02/09
   EP - JONGERIUS Agnes (S&D) appointed as rapporteur in EMPL
2021/01/24
   IT_SENATE - Contribution
Documents
2021/01/19
   PT_PARLIAMENT - Contribution
Documents
2021/01/17
   BG_PARLIAMENT - Contribution
Documents
2020/12/21
   CZ_SENATE - Contribution
Documents
2020/12/14
   ES_PARLIAMENT - Contribution
Documents
2020/11/11
   EP - Committee referral announced in Parliament, 1st reading
2020/10/29
   EC - Document attached to the procedure
Documents
2020/10/29
   EC - Document attached to the procedure
2020/10/29
   EC - Document attached to the procedure
2020/10/28
   EC - Legislative proposal published
Details

PURPOSE: to establish a framework to improve the adequacy of minimum wages and to increase the access of workers to minimum wage protection.

PROPOSED ACT: Directive of the European Parliament and of the Council.

ROLE OF THE EUROPEAN PARLIAMENT: the European Parliament decides in accordance with the ordinary legislative procedure and on an equal footing with the Council.

BACKGROUND: adequate minimum wages are a fundamental component of the European model of social market economy. When set at adequate levels, minimum wages protect the income of disadvantaged

workers, help ensure a decent living, and limit the fall in income during bad times. During economic recessions, such as the COVID-19 crisis, the role of minimum wages in protecting low-wage workers is essential to support a sustainable and inclusive economic recovery.

Principle 6 of the Pillar on ‘Wages’ calls for adequate minimum wages as well as for transparent and predictable wage setting to be put in place, according to national practices and respecting the autonomy of the social partners.

Minimum wage protection can be provided by collective agreements (as is the case in six Member States) or by statutory minimum wages set by law (as is the case in 21 Member States).

However, many workers are currently not protected by adequate minimum wages in the EU. In the majority of Member States with national statutory minimum wages, minimum wages are too low vis-à-vis other wages or to provide a decent living, even if they have increased in recent years. National statutory minimum wages are lower than 60% of the gross median wage and/or 50% of the gross average wage in almost all Member States. In 2018, the statutory minimum wage did not provide sufficient income for a single minimum-wage earner to reach the at-risk-of-poverty threshold in nine Member States.

In this context, the proposed directive aims to ensure that EU workers are protected by adequate minimum wages allowing for a decent living wherever they work.

IMPACT ASSESSMENT: the quantitative analysis carried out on a scenario based on a hypothetical increase of minimum wages to 60% of the gross median wage shows that it would improve the adequacy of minimum wages in about half of the Member States. Between 10 and 20 million workers would benefit from these improvements. In several countries, improvements in minimum wage protection would result in a reduction of in-work poverty and wage inequality by over 10% and a reduction in the gender pay gap by about 5% or more.

CONTENT: the proposed directive establishes minimum requirements at EU level to ensure both that minimum wages are set at an adequate level and that workers can have access to the protection offered by minimum wages, either in the form of a statutory minimum wage or in the form of wages set by collective agreements.

The proposal respects Member States’ competence to set higher standards, without prejudice to the role that Member States may entrust to social partners, in accordance with national traditions and in full respect of social partners’ contractual freedom.

The proposed Directive:

- would apply to workers with an employment contract or employment relationship as defined by law, collective agreements or practice in each Member State, including workers in atypical forms of employment ;

- would oblige Member States to take measures to promote the capacity of the social partners to engage in collective bargaining on wages to encourage wage bargaining.

In the case of countries where there is a legal minimum wage, the proposal:

- requires Member States to provide for national criteria for setting and updating statutory minimum wages that are defined in a stable and clear manner, regular and timely updates and the establishment of consultative bodies;

- calls on the Member States, in consultation with the social partners to: (i) limit the use of variations in minimum wages and their application over time and their extent and (ii) provide for the protection of statutory minimum wages against unjustified or disproportionate deductions;

- requires effective and timely participation of the social partners in the setting and updating of statutory minimum wages, including through participation in consultative bodies;

- Requires Member States to take the necessary measures to ensure that workers have effective access to the protection offered by statutory minimum wages (e.g. strengthening the system of controls and field inspections, informing workers about applicable statutory minimum wages).

With a view to monitoring the implementation of this Directive, the Commission should report to the European Parliament and the Council its assessment of developments in the adequacy and coverage of minimum wages on the basis of the information provided by Member States.

Documents

Activities

Votes

Salaires minimaux adéquats dans l’Union européenne - Adequate minimum wages in the European Union - Angemessene Mindestlöhne in der Europäischen Union - A9-0325/2021 - Dennis Radtke, Agnes Jongerius - Décision d’engager des négociations interinstitutionnelles (commission EMPL) #

2021/11/25 Outcome: +: 443, -: 192, 0: 58
IT FR ES RO HU BG EL IE HR DE BE PT NL SI CY LU MT FI PL SK LV LT EE AT CZ DK SE
Total
75
79
58
33
21
17
19
13
12
94
21
20
27
8
6
6
5
14
52
13
8
11
7
18
21
14
21
icon: S&D S&D
143

Greece S&D

2

Slovenia S&D

2

Cyprus S&D

2

Luxembourg S&D

For (1)

1

Finland S&D

Abstain (1)

2

Latvia S&D

2

Lithuania S&D

2

Estonia S&D

2

Czechia S&D

Against (1)

1
icon: Verts/ALE Verts/ALE
71

Spain Verts/ALE

3

Ireland Verts/ALE

2

Belgium Verts/ALE

3

Portugal Verts/ALE

1

Netherlands Verts/ALE

2

Luxembourg Verts/ALE

For (1)

1

Finland Verts/ALE

3

Poland Verts/ALE

For (1)

1

Latvia Verts/ALE

1

Lithuania Verts/ALE

2

Austria Verts/ALE

3

Czechia Verts/ALE

3

Denmark Verts/ALE

2

Sweden Verts/ALE

3
icon: Renew Renew
98

Italy Renew

3

Hungary Renew

2

Ireland Renew

2

Croatia Renew

For (1)

1

Slovenia Renew

2

Luxembourg Renew

2

Finland Renew

3

Poland Renew

1

Latvia Renew

For (1)

1

Lithuania Renew

Abstain (1)

1

Estonia Renew

For (1)

Against (2)

3

Austria Renew

Against (1)

1

Sweden Renew

3
icon: NI NI
37

Germany NI

2

Netherlands NI

Against (1)

1

Slovakia NI

Abstain (1)

2

Lithuania NI

1
icon: The Left The Left
37

Belgium The Left

For (1)

1

Netherlands The Left

Abstain (1)

1

Cyprus The Left

2

Finland The Left

For (1)

1

Czechia The Left

1

Denmark The Left

Against (1)

1

Sweden The Left

Against (1)

1
icon: PPE PPE
176

Hungary PPE

1

Slovenia PPE

Against (1)

4
2

Luxembourg PPE

2

Malta PPE

For (1)

1

Finland PPE

3

Slovakia PPE

For (1)

Abstain (1)

5

Latvia PPE

2

Estonia PPE

Against (1)

1

Denmark PPE

Against (1)

1
icon: ECR ECR
63

Romania ECR

Abstain (1)

1

Bulgaria ECR

2

Greece ECR

1

Croatia ECR

Abstain (1)

1

Germany ECR

Abstain (1)

1

Netherlands ECR

4

Slovakia ECR

Against (1)

1

Latvia ECR

2

Lithuania ECR

Abstain (1)

1
3
icon: ID ID
68

Finland ID

2

Estonia ID

Against (1)

1

Austria ID

3

Czechia ID

For (1)

Against (1)

2

Denmark ID

Against (1)

1

Salaires minimaux adéquats dans l’Union européenne - Adequate minimum wages in the European Union - Angemessene Mindestlöhne in der Europäischen Union - A9-0325/2021 - Dennis Radtke, Agnes Jongerius - Accord provisoire - Am 107 #

2022/09/14 Outcome: +: 505, -: 92, 0: 44
DE IT ES FR RO PL HU PT EL AT BG IE NL FI BE HR LT LV SI SK LU MT CZ CY EE DK SE
Total
93
57
57
77
29
46
18
21
18
19
12
12
28
14
21
11
8
8
7
11
6
5
20
6
7
11
19
icon: PPE PPE
162

Hungary PPE

1

Lithuania PPE

2

Latvia PPE

2

Slovakia PPE

Abstain (1)

3

Luxembourg PPE

2

Malta PPE

For (1)

1
2

Estonia PPE

Abstain (1)

1

Denmark PPE

Against (1)

1
icon: S&D S&D
137

Greece S&D

For (1)

1
3

Lithuania S&D

2

Latvia S&D

2

Slovenia S&D

2

Slovakia S&D

2

Luxembourg S&D

For (1)

1

Czechia S&D

For (1)

1

Cyprus S&D

2

Estonia S&D

2
icon: Renew Renew
93

Italy Renew

For (1)

1

Poland Renew

1

Hungary Renew

For (1)

1

Greece Renew

1

Austria Renew

For (1)

1

Ireland Renew

2

Finland Renew

3

Croatia Renew

For (1)

1

Lithuania Renew

1

Latvia Renew

For (1)

1

Slovenia Renew

For (1)

1

Slovakia Renew

3

Luxembourg Renew

2

Estonia Renew

3

Denmark Renew

For (1)

Abstain (1)

4

Sweden Renew

3
icon: Verts/ALE Verts/ALE
67

Italy Verts/ALE

2

Poland Verts/ALE

For (1)

1

Portugal Verts/ALE

1

Austria Verts/ALE

3

Ireland Verts/ALE

2

Netherlands Verts/ALE

3

Finland Verts/ALE

3

Belgium Verts/ALE

3

Lithuania Verts/ALE

2

Luxembourg Verts/ALE

For (1)

1

Czechia Verts/ALE

3

Denmark Verts/ALE

2

Sweden Verts/ALE

3
icon: The Left The Left
36

Portugal The Left

4

Ireland The Left

3

Netherlands The Left

For (1)

1

Finland The Left

For (1)

1

Belgium The Left

For (1)

1

Czechia The Left

1

Cyprus The Left

2

Sweden The Left

Against (1)

1
icon: NI NI
35

Germany NI

Against (1)

3

France NI

Against (1)

2

Croatia NI

Abstain (1)

2

Lithuania NI

1

Latvia NI

2

Slovakia NI

2
icon: ECR ECR
53

Germany ECR

Against (1)

1

Greece ECR

1

Croatia ECR

Against (1)

1

Latvia ECR

Abstain (1)

1

Slovakia ECR

Against (1)

1

Sweden ECR

2
icon: ID ID
58

Austria ID

3

Netherlands ID

Against (1)

1

Finland ID

2

Czechia ID

Against (1)

Abstain (1)

2

Estonia ID

Against (1)

1

Denmark ID

Against (1)

1
AmendmentsDossier
1119 2020/0310(COD)
2021/05/18 EMPL 839 amendments...
source: 692.765
2021/05/20 FEMM 280 amendments...
source: 692.831

History

(these mark the time of scraping, not the official date of the change)

docs/3
date
2021-01-21T00:00:00
docs
url: http://www.europarl.europa.eu/RegData/docs_autres_institutions/parlements_nationaux/com/2020/0682/SE_PARLIAMENT_AVIS-COM(2020)0682_EN.pdf title: PE663.217
type
Reasoned opinion
body
SE_PARLIAMENT
docs/4
date
2021-01-22T00:00:00
docs
url: http://www.europarl.europa.eu/RegData/docs_autres_institutions/parlements_nationaux/com/2020/0682/MT_PARLIAMENT_AVIS-COM(2020)0682_EN.pdf title: PE663.386
type
Reasoned opinion
body
MT_PARLIAMENT
docs/5
date
2021-02-01T00:00:00
docs
url: http://www.europarl.europa.eu/RegData/docs_autres_institutions/parlements_nationaux/com/2020/0682/DK_PARLIAMENT_AVIS-COM(2020)0682_EN.pdf title: PE680.727
type
Reasoned opinion
body
DK_PARLIAMENT
docs/9
date
2021-06-08T00:00:00
docs
title: PE693.809
type
Amendments tabled in committee
body
EP
events/9/docs
  • url: https://www.europarl.europa.eu/doceo/document/CRE-9-2022-09-13-TOC_EN.html title: Debate in Parliament
events/13/summary
  • PURPOSE: to improve living and working conditions in the EU, in particular the adequacy of minimum wages for workers in order to contribute to upward social convergence and reduce wage inequality.
  • LEGISLATIVE ACT: Directive (EU) 2022/2041 of the European Parliament and of the Council of 19 October 2022 on adequate minimum wages in the European Union.
  • CONTENT: this Directive establishes a framework for:
  • - adequacy of statutory minimum wages with the aim of achieving decent living and working conditions;
  • - promoting collective bargaining on wage-setting;
  • - enhancing effective access of workers to rights to minimum wage protection where provided for in national law and/or collective agreements.
  • The Directive will be without prejudice to:
  • - the full respect for the autonomy of the social partners, as well as their right to negotiate and conclude collective agreements;
  • - the competence of Member States in setting the level of minimum wages, as well as to the choice of the Member States to set statutory minimum wages, to promote access to minimum wage protection provided for in collective agreements, or both.
  • Procedure for setting adequate statutory minimum wages
  • Member States with statutory minimum wages will establish the necessary procedures for the setting and updating of statutory minimum wages . Such setting and updating will be guided by criteria set to contribute to their adequacy, with the aim of: (i) achieving a decent standard of living, (ii) reducing in-work poverty, as well as (iii) promoting social cohesion and upward social convergence, and (iv) reducing the gender pay gap.
  • Updates of statutory minimum wages will take place at least every two years (or at the latest every four years for those countries which use an automatic indexation mechanism).
  • To guide their assessment of the adequacy of statutory minimum wages, Member States may use indicative reference values commonly used at international level , such as 60% of gross median wage and 50 % of the gross average wage, and/or indicative reference values used at national level.
  • Promotion of collective bargaining for wage-setting
  • Member States, with the participation of the social partners and in accordance with national law and practice, will:
  • - promote the capacity of the social partners to engage in collective bargaining for wage-setting;
  • - take measures, where appropriate, to protect the exercise of the right to collective bargaining and to protect workers and trade union representatives against acts of discrimination in employment on the grounds that they are participating or wish to participate in collective bargaining for wage fixing.
  • Where collective bargaining coverage is below a threshold of 80% , Member States will establish an action plan to promote collective bargaining. The action plan should set out a clear timetable and specific measures for progressively increasing collective bargaining coverage.
  • Member States will take the necessary measures to ensure that the social partners are involved in setting and updating statutory minimum wages.
  • Effective access of workers to statutory minimum wages
  • The Directive provides that Member States will take the following measures to enhance the effective access of workers to statutory minimum wage protection. These measures include:
  • - controls by labour inspectorates;
  • - easily accessible information on minimum wage protection and;
  • - developing the capability of enforcement authorities to prosecute non-compliant employers.
  • Right to redress and protection against adverse treatment or consequences
  • Workers and workers’ representatives, including those who are trade union members or representatives, will be in a position to exercise their right of defence when their rights relating to minimum wage protection are provided for in national law or collective agreements and have been violated.
  • Member States will take the necessary measures to ensure that workers have access to effective, timely and impartial dispute resolution and a right to redress, as well as effective judicial and/or administrative protection from any form of detriment, if they decide to exercise their right of defence.
  • This Directive will not constitute valid grounds for reducing the general level of protection already provided to workers within Member States, in particular with regard to the lowering or abolition of minimum wages.
  • ENTRY INTO FORCE: 14.11.2022.
  • TRANSPOSITION: no later than 15.11.2024.
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  • The European Parliament adopted by 505 votes to 92, with 44 abstentions, a legislative resolution on the proposal for a directive of the European Parliament and of the Council on adequate minimum wages in the European Union.
  • The proposal for a directive establishes a framework for making minimum wages more adequate and improving workers' access to minimum wage protection.
  • The European Parliament's first reading position under the ordinary legislative procedure amends the proposal as follows:
  • Framework established by the Directive
  • The Directive aims to improve living and working conditions in the Union with the objective of contributing to upward social convergence and reducing wage inequalities.
  • To this end, the Directive establishes a framework for:
  • - the adequacy of statutory minimum wages with a view to achieving decent living and working conditions;
  • - the promotion of collective bargaining for wage-setting;
  • - enhancing effective access of workers to rights to minimum wage protection where provided for in national law and/or collective agreements.
  • It is clarified that the Directive is without prejudice to the full respect of the autonomy of the social partners and their right to negotiate and conclude collective agreements. The new directive will apply to all workers in the EU who have a contract of employment or an employment relationship. Member States where the minimum wage is already protected by collective agreements will not be obliged to apply these rules or to make these agreements generally applicable.
  • Promotion of collective bargaining for wage-setting
  • To increase the coverage of collective bargaining and to facilitate the exercise of the right to collective bargaining for wage-setting, Member States, with the participation of the social partners and in accordance with national law and practice, should:
  • - encourage constructive negotiations on wages between the social partners on an equal footing, in which both parties have access to appropriate information to exercise their functions regarding collective bargaining for wage-setting;
  • - take measures, where appropriate, to protect the exercise of the right to collective bargaining and to promote collective bargaining for wage-setting.
  • In countries where less than 80% of workers are covered by collective bargaining, Member States, in collaboration with the social partners, should draw up an action plan to promote collective bargaining.
  • Procedure for setting adequate statutory minimum wages
  • Member States with statutory minimum wages should establish the necessary procedures for the setting and updating of statutory minimum wages. These procedures should be guided by criteria set to contribute to their adequacy, with the aim of achieving a decent standard of living, reducing in-work poverty, as well as promoting social cohesion and upward social convergence, and reducing the gender pay gap.
  • The national criteria should include at least the following elements: (a) the purchasing power of statutory minimum wages, taking into account the cost of living; (b) the general level of wages and their distribution; (c) the growth rate of wages; (d) long-term national productivity levels and developments.
  • Member States should use indicative reference values to guide their assessment of adequacy of statutory minimum wages. To that end, they may use indicative reference values commonly used at international level such as 60 % of the gross median wage and 50 % of the gross average wage , and/or indicative reference values used at national level.
  • Regular and timely updates of statutory minimum wages should take place at least every two years.
  • Enforcement system
  • The amended text introduces an obligation for Member States to put in place an effective enforcement system, including reliable monitoring as well as controls and field inspections, in order to ensure compliance with these rules and to combat abusive sub-contracting, bogus self-employment, undeclared overtime or health and safety risks linked to increased work intensity.
  • Member States will also need to take measures to (i) ensure that, in awarding and performing public contracts , economic operators and their subcontractors respect the applicable obligations concerning wages and the right to collective bargaining on wage setting; and (ii) ensure that effective data collection tools are in place to monitor minimum wage protection.
  • Information on minimum wage protection
  • Information on statutory minimum wages and minimum wage protection provided by generally applicable collective agreements, including information on redress mechanisms , should be made available to the public, where necessary in the most relevant language, as determined by the Member State, in a comprehensive and easily accessible way, including to persons with disabilities.
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  • The Committee on Employment and Social Affairs adopted the report by Dennis RADTKE (EPP, DE) and Agnes JONGERIUS (S&D, NL) on the proposal for a directive of the European Parliament and of the Council on adequate minimum wages in the European Union.
  • The proposal for a directive establishes a framework to make minimum wages more adequate and to improve workers' access to minimum wage protection.
  • The committee responsible recommended that the European Parliament's position adopted at first reading under the ordinary legislative procedure should amend the proposal as follows:
  • Framework established by the directive
  • According to Members, the directive should aim to improve working and living conditions in the EU for all workers, contribute to upward social convergence and reduce pay inequalities and the gender pay gap in the EU.
  • To this end, the Directive should establish a framework to:
  • - determine the adequate and fair level of minimum wages to ensure at least a decent standard of living for workers and their families;
  • - ensure protection offered by minimum wages , in the form of: (i) a non-discriminatory statutory minimum wage, where statutory minimum wages exist; (ii) access to collective bargaining for wage setting; and (iii) universally applicable collective agreements, where they exist.
  • The Directive should apply with due respect for the freedom of association and the right to collective bargaining as recognised in the Charter of Fundamental Rights of the European Union, the European Social Charter and the relevant International Labour Organisation (ILO) conventions. The social partners would retain the right to negotiate, monitor and set wages through collective agreements.
  • Promotion of collective bargaining for wage setting
  • In cooperation with the social partners, Member States should also:
  • - prohibit and take measures to prevent all acts which undermine the right of workers to join a trade union, or which discriminate against workers and trade union representatives participating in collective bargaining on wage setting, and ensure that all workers have appropriate access to the necessary information on their rights;
  • - prohibit all acts aimed at undermining collective bargaining on wage setting;
  • - ensure that employers provide trade union representatives with appropriate information and facilities to enable them to carry out their functions in respect of collective bargaining on wage setting;
  • - support compliance with applicable collective wage agreements, also along the sub-contracting chains, and the provision of collective wage agreements to employers and workers.
  • Action plan
  • Member States where the overall collective bargaining coverage regulating remuneration is less than 80% of the workers should ensure conditions conducive to the promotion of collective bargaining, in the form of an action plan, by law following consultation with and in agreement with the social partners.
  • The action plan should set out a clear timeline and concrete measures to effectively ensure the right to collective bargaining to promote and progressively increase the coverage of such collective bargaining to at least 80% of the workers . The action plan should be updated at least every two years, after consulting social partners, in agreement with social partners. The Commission should monitor progress and report annually to the European Parliament and the Council in this respect.
  • Adequacy and fairness of statutory minimum wages
  • Member States should ensure that statutory minimum wages are adequate and fair and guarantee a decent standard of living. Member States in which statutory minimum wages do not result from collective bargaining should put in place measures to ensure that the setting and updating of such wages contribute to combating poverty, in particular in-work poverty , to promoting social cohesion and to reducing wage inequalities.
  • National criteria
  • The setting and updating of wages should be based on criteria to ensure adequacy and fairness with the aim of creating decent working and living conditions, eliminating the gender pay gap and ensuring upward convergence , taking into account the situation of the labour market concerned.
  • National criteria should include: (i) the purchasing power of statutory minimum wages, taking into account the cost of living, based on a national basket of goods and services at real prices, including VAT, social security contributions and public services; (ii) the poverty rate, in particular the rate of in-work poverty.
  • Member States should assess and report on the adequacy of statutory minimum wages. Statutory minimum wages should be updated in a transparent way, at least once a year.
  • Members opposed the possibility for Member States to allow different statutory minimum wage rates for specific groups of workers or to allow statutory deductions that reduce workers' pay below the statutory minimum wage.
  • Monitoring compliance with the Directive
  • Member States that apply statutory minimum wages should increase the intensity and frequency of on-the-spot checks and inspections and ensure that sufficient resources are available to ensure that such checks and inspections are effective, dissuasive, proportionate and non-discriminatory. Members called for information to be provided in formats accessible to all, in particular to persons with disabilities, and for workers and employers to have access to mediation or dispute settlement.
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New
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  • title: Joint Declaration 2021 url: https://oeil.secure.europarl.europa.eu/oeil/popups/thematicnote.do?id=2066000&l=en
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  • PURPOSE: to establish a framework to improve the adequacy of minimum wages and to increase the access of workers to minimum wage protection.
  • PROPOSED ACT: Directive of the European Parliament and of the Council.
  • ROLE OF THE EUROPEAN PARLIAMENT: the European Parliament decides in accordance with the ordinary legislative procedure and on an equal footing with the Council.
  • BACKGROUND: adequate minimum wages are a fundamental component of the European model of social market economy. When set at adequate levels, minimum wages protect the income of disadvantaged
  • workers, help ensure a decent living, and limit the fall in income during bad times. During economic recessions, such as the COVID-19 crisis, the role of minimum wages in protecting low-wage workers is essential to support a sustainable and inclusive economic recovery.
  • Principle 6 of the Pillar on ‘Wages’ calls for adequate minimum wages as well as for transparent and predictable wage setting to be put in place, according to national practices and respecting the autonomy of the social partners.
  • Minimum wage protection can be provided by collective agreements (as is the case in six Member States) or by statutory minimum wages set by law (as is the case in 21 Member States).
  • However, many workers are currently not protected by adequate minimum wages in the EU. In the majority of Member States with national statutory minimum wages, minimum wages are too low vis-à-vis other wages or to provide a decent living, even if they have increased in recent years. National statutory minimum wages are lower than 60% of the gross median wage and/or 50% of the gross average wage in almost all Member States. In 2018, the statutory minimum wage did not provide sufficient income for a single minimum-wage earner to reach the at-risk-of-poverty threshold in nine Member States.
  • In this context, the proposed directive aims to ensure that EU workers are protected by adequate minimum wages allowing for a decent living wherever they work.
  • IMPACT ASSESSMENT: the quantitative analysis carried out on a scenario based on a hypothetical increase of minimum wages to 60% of the gross median wage shows that it would improve the adequacy of minimum wages in about half of the Member States. Between 10 and 20 million workers would benefit from these improvements. In several countries, improvements in minimum wage protection would result in a reduction of in-work poverty and wage inequality by over 10% and a reduction in the gender pay gap by about 5% or more.
  • CONTENT: the proposed directive establishes minimum requirements at EU level to ensure both that minimum wages are set at an adequate level and that workers can have access to the protection offered by minimum wages, either in the form of a statutory minimum wage or in the form of wages set by collective agreements.
  • The proposal respects Member States’ competence to set higher standards, without prejudice to the role that Member States may entrust to social partners, in accordance with national traditions and in full respect of social partners’ contractual freedom.
  • The proposed Directive:
  • - would apply to workers with an employment contract or employment relationship as defined by law, collective agreements or practice in each Member State, including workers in atypical forms of employment ;
  • - would oblige Member States to take measures to promote the capacity of the social partners to engage in collective bargaining on wages to encourage wage bargaining.
  • In the case of countries where there is a legal minimum wage, the proposal:
  • - requires Member States to provide for national criteria for setting and updating statutory minimum wages that are defined in a stable and clear manner, regular and timely updates and the establishment of consultative bodies;
  • - calls on the Member States, in consultation with the social partners to: (i) limit the use of variations in minimum wages and their application over time and their extent and (ii) provide for the protection of statutory minimum wages against unjustified or disproportionate deductions;
  • - requires effective and timely participation of the social partners in the setting and updating of statutory minimum wages, including through participation in consultative bodies;
  • - Requires Member States to take the necessary measures to ensure that workers have effective access to the protection offered by statutory minimum wages (e.g. strengthening the system of controls and field inspections, informing workers about applicable statutory minimum wages).
  • With a view to monitoring the implementation of this Directive, the Commission should report to the European Parliament and the Council its assessment of developments in the adequacy and coverage of minimum wages on the basis of the information provided by Member States.
otherinst
  • name: European Economic and Social Committee
  • name: European Committee of the Regions
procedure/other_consulted_institutions
European Economic and Social Committee European Committee of the Regions
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