24m could get pay rise under EU directive

18.02.2021 by https://www.etuc.org/

More than 24 million workers on low wages in the EU would receive a much-needed pay rise if trade union proposals for the EU’s draft Directive on Adequate Minimum Wages are accepted.

The European Trade Union Confederation is pushing for a ‘threshold of decency’ to be included in the legislation that would ensure statutory minimum wages could never be paid at less than 60% of the median wage and 50% of the average wage in the Member State.

The European Commission has included the threshold in the draft directive but only as an indicative guide for member states. The ETUC is working with MEPs to make this a mandatory bottom line when the directive comes before the European Parliament.

The ETUC is also calling for amendments to ensure that the ‘adequacy’ requirement in the Directive means that Member States can decide the level at which their statutory minimum wages are to be paid (above the threshold) but that their statutory minimum wages are always enough to ensure a decent standard of living.

Establishing the ‘threshold of decency’ would result in a pay rise for at least a quarter of the workforce in six EU countries, a analysis by the Commission has found.

CountryNumber of workers who get pay rise from ‘threshold of decency’Percentage of total workforce which would benefit from thresholds
Bulgaria648,95123%
Czechia492,04011%
Germany6,834,66118%
Estonia116,36121%
Greece907,48634%
Spain4,120,21425%
France2,201,9399%
Croatia249,61217%
Hungary803,70920%
Ireland486,83325%
Lithuania115,77710%
Luxembourg57,55222%
Malta24,32312%
Latvia143,65619%
Netherlands657,9379%
Poland3,998,32931%
Portugal508,12613%
Romania1,476,09136%
Slovenia61,8327%
Slovakia408,78819%

These are figures put forward by the European Commission which have not been verified and are an underestimation. For example, the correct figure for the Netherlands is 16,52%.

ETUC Deputy General Secretary Esther Lynch said:

“A minimum wage that leaves workers in poverty defeats the entire point of minimum wages. Even the European Commission’s conservative figures recognise the appalling situation facing millions of minimum wage earners, but their draft directive would not translate into real pay rises at it stands.

“It is now down to the European Parliament and to the European governments to amend the draft Directive to ensure that member states can no longer set their minimum wages below the ‘threshold of decency’. Moreover, the Directive also needs to be amended to require Member States to set their statutory minimum wages above the threshold of decency and paid at an ‘adequate’ level that is worked out with the full involvement of trade unions.  

“A decent pay rise for the lowest earners in Europe is long overdue and would boost the EU’s recovery. There is no better economic stimulus than putting money in the pockets of the lowest paid, who are the most likely to spend it in struggling businesses rather than hoarding it.”

ETUC’s proposals for the Directive to include a ‘threshold of decency’ and an ‘adequacy’ guarantee apply to member states with statutory minimum wages.