European Commission launches consultation over fair minimum wage

The European Commission has launched the second-stage consultation with European trade unions and employers, ensuring that employees within the European Union receive a fair minimum wage.

Following the financial impact of the Covid-19 (Coronavirus) pandemic on organisations and employees, the European Commission has decided a second consultation is necessary.

New negotiated regulations will ensure that vulnerable employees will receive financial support during the current climate, receive greater incentives to work, reduce wage inequalities in society, increase domestic demand and help close the gender pay gap.

The Commission does not aim to set a European-wide minimum wage or set a minimum wage for employees working within the European Union, and any possible changes to the minimum wage will be implemented depending on the minimum wage setting systems within the employee’s country of residence, taking into account national wage structures and contractual freedom.

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The initiative aims to ensure that there is a collective bargaining wage-setting in place among countries, allowing national frameworks to be regularly checked and updated. The consultation also sets out to ensure that social partners are involved in the regulations, minimum wage variations are limited and monitoring mechanisms are in place.

Valdis Dombrovskis, executive vice-president at An Economy that Works for People, said: “As we work towards inclusive recovery from the Coronavirus crisis, we want to make sure that all employees in the EU are protected by a fair minimum wage, allowing them to earn a decent living wherever they work. Social partners play a crucial part in negotiating wages nationally and locally, and should be involved in setting minimum wages both in countries relying solely on collectively agreed wage floors and in those with a statutory minimum wage.”