Minimum wage directive already influencing rate setting

Europe

A new policy brief from the ETUI reveals that the Adequate Minimum Wages Directive is already having an impact on minimum wage-setting even though it doesn’t have to be transposed into national law until November this year. The latest data show a substantial nominal increase in statutory minimum wages in 15 out of the 22 EU countries which statutory minimum wages. The ETUI says that two factors are important here – first, high levels of inflation have continued to prevail across the EU, making the safeguarding of the purchasing power of minimum-wage earners a political priority. Second, some Member States are already using the Directive’s ‘double decency threshold’ (60% of the median wage and 50% of the average wage). There a several different impacts including putting elements of it into national law (Bulgaria – 50% of average), serving as a political guideline (Croatia – increases with reference to double threshold); new statutory minimum wage set at 60% of median (Cyprus);  government commitment to increase the minimum wage to 60% of the median by 2026 (Ireland); tripartite ‘goodwill agreement’ to set the minimum wage at 50% of the average by 2027 (Estonia); boosting the debate about the adequacy of minimum wages (Germany, Latvia and Spain); becoming part of trade union strategy – union campaign for a minimum wage at 60% of the median (Netherlands); and where unions are arguing for increases to the minimum wage (Hungary and Romania). 

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