Crucial wages directive needs improvement

Responding to the European Commission’s proposal for a directive on fair wages, ETUC Deputy General Secretary Esther Lynch said:

“Commissioner Schmit's proposal for a Directive is a positive step as it is the only way to achieve real change.

“The Directive requires member states to take action to promote collective bargaining, and have national action plans to increase coverage if less than  70% of workers are covered by a collective agreement. But workers are not guaranteed protection from employer reprisal when they join a union.

“The Directive requires member states to promote minimum wages that are adequate, but workers on minimum wages are not guaranteed the pay increases they need.

“Higher minimum wages and more collective bargaining can be achieved by amending the Directive.

“Trade unions will fight hard to secure the improvements needed from MEPs and Ministers.”

Key improvements that need to be made to the directive include:  

  • A threshold of decency below which statutory minimum wages cannot fall must be included in the legal provisions of the directive. It has to be added to ensure statutory minimum wages do not continue to leave workers living below the poverty line. The ETUC is calling for the threshold to be  60% of the median wage and 50% of the average wage.
  • The directive includes an article on how public procurement can be used as a tool to raise wages. But it would still not require private companies to respect collective bargaining as a condition of benefiting from public procurement and other funding like CAP and Recovery Funds. Public bodies spend around €2 trillion (14 per cent of gdp) a year in the EU on purchasing goods and services. This should be invested with companies that pay fair wages.
  • The draft Directive requires member states in which less than 70% of workers are covered by collective bargaining (18 member states – see link below) to adopt an action plan to promote collective bargaining. The Directive needs to  specify that these plans must ensure respect of the right to collective bargaining and deal with real-life problems like union busting
  • The exclusion of certain workers, like domestic workers and young people, from statutory minimum wages must be clearly ended and employers must be clearly banned from making deductions from statutory minimum wages.

National and European union leaders meeting at the ETUC Executive Committee tomorrow will discuss the Directive and how to respond.   

More information on the ETUC’s proposals for the directive can be found here.

Background: the wage situation in Europe

Statutory minimum wages leave workers at risk of poverty in at least 16 EU member states and workers in six member states are worse off than 10 years ago.

The evidence shows the EU countries with the lowest levels of collective bargaining have the lowest wages and 3.3 million workers have lost out on collective bargaining since 2000.

See for members states with les than 70% of workers covered by collective bargaining – and would therefore need to have an action plan to boost collective bargaining