Commission pushes for EU minimum wage
As the lockdown measures begin to be lifted, the focus has shifted to the economic effects of the crisis and how the EU can recover.
However, Covid-19 has also highlighted existing inequalities that need to be addressed, both within and between member states.
It’s crucial that EU workers have enough to live on – especially in the current economic conditions.
Without the right support, economic hardship may get worse in the coming years. So, the Commission is keen to introduce a minimum wage across the EU.
What’s the current situation?
In the last few decades, it’s clear that minimum wages haven’t been enough, and in-work poverty has soared. This has left huge inequalities and many citizens are struggling to cope – especially in times of crisis.
Between 2007 and 2018, in-work poverty has increased to 9.4%, with most minimum wage workers between the ages of 25 and 49 with medium education level.
In addition, there are still large differences between the countries of the EU. For example, the minimum wage in Spain, France, Germany, Belgium, the UK, Luxembourg, and Ireland is over €1000 per month; but in Latvia, Romania, and Bulgaria it’s less than €500.
The biggest difference, is between Luxembourg, where the minimum wage is around €2,000, and Bulgaria, where it’s just €250.
And although cost of living needs to be taken into account, such a large gap will still have a negative impact on the success of the single market.
How would a minimum wage be implemented?
The Commission is now considering how it can take action to implement an EU-wide minimum wage.
One option would be to introduce it as part of a working conditions directive. Or, it could be implemented as a council recommendation. Either way, it would be up to national governments to roll it out to companies and employers.
At the moment, different member states take different approaches. Some have a minimum wage that comes from collective bargaining; others have government imposed minimum wages.
According to a Commission spokesperson, a new directive would guarantee “certainty” and “policy guidance”.
And, according to EU Jobs Commissioner Nicolas Schmit, “Everyone deserves a decent standard of living. Low waged workers kept our societies and economies alive when all else had to stop”.
He added, “Paradoxically, they will be hit the hardest by the crisis. We must work towards an initiative on minimum wages in the EU is an essential element of our recovery strategy.”