Proposal for a Directive on adequate minimum wages in the European Union

Author (Corporate)
Series Details COM (2020) 682
Publication Date 28/10/2020
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Legislative initiative tabled by the European Commission on 28 October 2020, proposing the creation of a framework to improve the adequacy of minimum wages and the access of workers to minimum wage protection in the European Union (EU).

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In November 2017, the European Union proclaimed the European Pillar of Social Rights (EPSR) to deliver on the promise of prosperity, progress and convergence, and make Social Europe a reality for all. On of the items under the EPSR 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 social partners. The Strategic Agenda for 2019-2024 called for the implementation of the EPSR at EU and national level. The Political Guidelines for the mandate 2019-2024 of the European Commission included the publication of an Action Plan aimed at implementing the EPSR, which was later released in January 2020. At the State of the Union address in September 2020, the President of the Commission again pledged to present a legal instrument to ensure that workers in the EU have a fair minimum wage.

The proposed Directive aims to ensure that workers across the EU are protected by adequate minimum wages allowing for a decent living wherever they work. It was designed to safeguard access to employment and take into account the effects on job creation and competitiveness. In order to reach these objectives, the proposed Directive aims to promote collective bargaining on wages in all Member States. Countries with statutory minimum wages are required to put in place the conditions for adequate statutory minimum wages, including setting clear and stable criteria, providing for regular and timely updates, and an effective involvement of the social partners.

The proposal does not seek to harmonise the level of minimum wages across the EU, nor to establish a uniform mechanism for setting minimum wages in the Member States.

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Commentary and Analysis
Confederation of Finnish Industries: News, 29/10/2020: The Commission’s minimum wage proposal goes beyond the EU’s competence
ETUI: News, 02/11/2020: Minimum wage directive, not the silver bullet for all workers in the EU
EU Law Analysis, 05/11/2020: The proposal on adequate minimum wages in the European Union: Striving for fairness, less so adequacy
Social Europe, 10/11/2020: Minimum-wage directive: yes, but …
Institut Jacques Delors: Publications, 18/11/2020: A move towards adequate minimum wages in the European Union?
EPRS: At a Glance, November 2020: The Proposed Minimum Wage Directive
EPRS: Briefing, January 2021: Adequate minimum wages (Initial Appraisal of a European Commission Impact Assessment)

Reuters, 28/10/2020: EU Commission proposes rules for adequate minimum wage in EU
EurActiv, 28/10/2020: Commission makes it clear: Same minimum wage for all EU countries is impossible
Euronews, 28/10/2020: Sweden opposes Brussels proposal for EU minimum wage guarantee
Bloomberg, 28/10/2020: Denmark Prepares to Fight EU’s Proposal for Minimum Wage
EurActiv, 30/10/2020: No need for a statutory minimum wage, says Finland

EUR-Lex: SWD(2020)245: Staff Working Document accompanying the Proposal - Impact Assessment
EUR-Lex: SWD(2020)246: Staff Working Document accompanying the Proposal - Executive Summary of the Impact Assessment
European Commission: Press Release, 28/10/2020: Advancing the EU social market economy: adequate minimum wages for workers across Member States
European Commission: Questions and answers: Adequate minimum wages (28 October 2020)
European Commission: Opening remarks by Executive Vice-President Dombrovskis at the read-out of the College meeting and press conference on adequate minimum wages (28 October 2020)
European Commission: Opening remarks by Commissioner Schmit at the read-out of the College meeting and press conference on adequate minimum wages (28 October 2020)
PES: News, 28/10/2020: PES welcomes historic EU minimum wages proposal
EPP Group: Newsroom, 28/10/2020: For a decent and fair living in Europe
G/EFA Group: Press Release, 28/10/2020: Commission Proposal welcome but falls short on ambition to fight poverty & inequality
Finnish Ministry of Economic Affairs and Employment: Press Release, 10/12/2020: Finland supports the aims of EU minimum wage initiative to combat in-work poverty

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