A “historic” day for EU workers and social Europe. On Thursday 16 June in Luxembourg, the European Ministers for Employment and Social Affairs did not hold back their words in welcoming the agreement reached with the European Parliament on the night of 6 to 7 June on the Directive on adequate minimum wages (see EUROPE 12966/12, 12972/27).
They have, as expected, given broad political support to the negotiation, which they will, probably in September, put to a formal vote.
Following on from the French Minister for Labour, Employment and Social Affairs, Olivier Dussopt, whose Presidency made the final progress possible, European Commissioner Nicolas Schmit hailed a “good result for Europe and European workers”, which “shows that Europe functions” and knows how to be “effective” and to listen.
Adequate minimum wages are “essential to improve the living conditions of workers and their families”, ensuring a “decent standard of living” and reducing poverty, the Commissioner welcomed.
This “balanced and ambitious” Directive at the same time enshrines the essential role of collective bargaining in defining adequate minimum wages and will benefit women in particular, “because the majority of those who earn the minimum wage are women”.
Nor does the Directive call into question national specificities in terms of minimum wages or modify the organisation of the social partners, whose autonomy is fully respected. It is therefore “a good moment for social Europe”, the Commissioner commented.
For their part, the German, Italian, Luxembourg, and also Spanish and Portuguese Ministers also stressed the “historic” nature of this agreement. For Berlin, this Directive marks respect for dignified work. “Germany is happy to have moved the proposal forward”. And while the minimum wage will rise to €12 an hour in October, the German representative appreciated the space devoted to collective bargaining, “the most important thing for us”. “This is a very important step”, said Minister Hubertus Heil.
For Italy, which does not have national minimum wages but relies on sectoral agreements, this Directive opens a “passage towards a real social Europe” that will improve the living conditions of “millions of workers through collective bargaining”. The text has reached “a good equilibrium point” and will restore “dignity to work”, added Minister Andrea Orlando.
Spain also welcomed the agreement as part of a national drive to increase the minimum wage rate since 2019. Bulgaria, on the other hand, sees the agreement as a way to strengthen social cohesion in the EU.
Belgium, for its part, believes that by showing that social Europe can work through the decisions of public authorities, the Directive has the potential to “bring people closer to politics” at a time when they are moving away from it.
Luxembourg Minister Georges Engel also welcomed the result, which sends “a strong signal” one year after the Porto Social Summit and, “at a time when households are worried about making ends meet”, it is “crucial that we protect people on low incomes”.
Sweden, Denmark and Hungary will not support the text
Unsurprisingly, Denmark and Sweden indicated that they could not vote in favour of the text. Hungary, concerned that the Directive would call into question national competence over minimum wages, will abstain, its representative said on Thursday.
For the first two countries, which will vote against, concerns remain about the effects of the text on the autonomy of the social partners, “with the risk of rulings by the EU Court of Justice”, explained the Danish Minister, Peter Hummelgaard Thomsen.
Acknowledging that stakeholders had tried to address the Danish concern, the country would nevertheless have to “vote against”, the Dane said, also retaining the reservation on the legal basis.
For Sweden, there has always been a “consensus in the country that there should not be a binding instrument” in the area of minimum wages, so “we will not support the text”, said State Secretary Rasmus Cruce Naeyé. However, Sweden acknowledged the efforts of the French Presidency to stay close to the mandate given in December and “take into account national concerns”.
Austria, on the other hand, will make a statement to recall the specificity of its model, but will support the Directive, which has a considerable potential to strengthen “collective bargaining in the EU”.
In a statement, the S&D Group in Parliament welcomed the broad political agreement in the EU Council as a “victory” for workers. “Work will pay again”, commented co-rapporteur Agnes Jongerius (Netherlands).
“By setting the standards for adequate national minimum wages, the new European law will tackle the scandal of the working poor. Every European worker’s wage must pay for their food, their rent and their heating, but also allow them to afford new clothes, or go on holidays once in a while”.
“We want EU countries to check their minimum wages against international benchmarks; such as at least 50% of the average gross wage and 60% of the median gross wage. Currently, 18 EU countries do not meet these criteria”, added the S&D MEP.
BusinessEurope’s concerns
“We remain critical of an EU Directive on minimum wages and collective bargaining, but we acknowledge that the EU Council has insisted throughout the negotiations on a better recognition and respect of national and social partner competences”, said BusinessEurope’s Director General Markus J. Beyrer.
“By setting rules on minimum wages, the EU is entering unchartered waters and acting at the very limit of its competences. Avoiding a wage-price spiral is essential in the present context marked by already high inflation”.
Link to the agreement: https://aeur.eu/f/25h (Original version in French by Solenn Paulic)