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EU Rules & Initiatives

Adequate minimum wages for workers across Member States
On 28 October 2020, the Commission proposed an EU Directive to ensure that the workers in the EU are protected by adequate minimum wages allowing for a decent living wherever they work.

​When set at adequate levels, minimum wages do not only have a positive social impact but also bring wider economic benefits as they:
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  • reduce wage inequality
  • help sustain domestic demand and
  • strengthen incentives to work

Adequate minimum wages can also help reduce the gender pay gap, since more women than men earn a minimum wage. The proposal also helps protect employers that pay decent wages to workers by ensuring fair competition.
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The current crisis has particularly hit sectors with a higher share of low-wage workers such as cleaning, retail, health and long-term care and residential care. Ensuring a decent living for workers and reducing in-work poverty is not only important during the crisis but also essential for a sustainable and inclusive economic recovery.
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The Directive is adopted in October 2022
The Proposal for a Directive was the subject of negotiation between the two EU legislators, the Employment and Social Affairs Commission on behalf of the European Parliament and the EU Council of Ministers.

The two delegations reached a provisional agreement on 6 June 2022, which on 14 September 2022 was confirmed by the vote of the European Parliament in plenary session.

On 4 October 2022, the EU Directive was adopted by the Council of the EU.​ Read the Draft agreement, on the side.
What does the EU Directive ask?

1) Adequacy of the legal minimum wage

Member States that have introduced statutory minimum wages must provide mechanisms to set and update these minimum wages according to a set of clear criteria. Updates and notification to Brussels of statutory minimum wages must occur at least every two years, or four for countries using an automatic indexing mechanism. The social partners will have to be involved in the procedures for defining and updating the legal minimum wages.
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2) Promotion of collective bargaining

EU countries will have to promote the strengthening of the capacity of the social partners to engage in collective bargaining. Protection of employee representatives is also foreseen.

Where the coverage rate of collective bargaining is below a threshold of 80%, Member States will have to intervene to increase this threshold, through a promotion action plan. Countries that have not introduced a minimum wage will have to present programs aimed at defining a clear timetable and concrete measures at the national level, to progressively increase the coverage rate of collective bargaining and with it, a wider scope of application of minimum wages.
 
3) Effective access to the minimum wage
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If the minimum wage is in force, member countries will have to implement measures aimed at achieving:
 
  1. checks by labor inspectorates
  2. provide easily accessible information on minimum wage protection
  3. sanctioning measures for non-compliant employers
 

With this decision, the spirit of Objective 6 of the European Social Pillar is thus realized, which was not to impose a minimum wage everywhere, but to protect workers from exploitation and situations of poverty for themselves and their families.
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