European Parliament adopts new law on minimum wages

European Parliament adopts new law on minimum wages
Credit: Belga / Eric Lalmand

The European Parliament on Wednesday adopted new legislation on adequate minimum wages which aims to improve working and living conditions for all workers in the EU and promote economic and social progress.

The EU law was agreed on by the Parliament and European Council in June this year and was officially adopted on Wednesday 14 September with a massive majority.

"The current situation shows once again that we need functioning and strong social partnerships across Europe." The Minimum Wage Directive is a clear step in this direction German MEP Dennis Radtke said following the announcement.

Tweet translation: "The European Minimum Wage Directive overwhelmingly passed by the Parliament." 

The Directive will apply to all EU workers who have an employment contract or employment relationship. Countries where the minimum wage is already protected exclusively via collective agreements will not be obliged to make these changes.

MEP Agnes Jongerius (who led the negotiations on the Minimum Wage Directive with Radtke) noted that the decision is particularly welcome in light of the exploding grocery, energy and housing prices.

"People are really struggling to make ends meet. We have no time to waste, work must pay again. This Directive sets the standards for what an adequate minimum wage should look like," Jongerius said. "We are giving a boost to collective bargaining, so more workers will be better protected."

What will change in Belgium

While Member States set their own minimum wages independently of the EU, each nation will "have to guarantee that their national minimum wages allow workers to lead a decent life, taking into account the cost of living and wider pay levels."

All EU Member States have two years to implement the requirements of the Directive. Belgium's Minister of Economy and Labour Pierre-Yves Dermagne announced that the minimum wage would be increased to reach “an acceptable level." At present, the minimum wage in Belgium falls short of European standards.

In order to reach the target of 60% median salary set by the new Directive, Belgium will have to raise its minimum wage by an additional €174 per month (in concrete terms, at least €12 per hour).

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The text was praised by the liberal Renew Europe group as a "welcome first step," however, it was noted the Commission did not follow all the proposals made by the group in a resolution adopted last June.

The group added that several questions remain about what the text will mean in practice, including the "important responsibility given to the EU Member States to implement the text."

“The Commission delivered an ambitious instrument in which many elements the European Parliament called for are incorporated. I especially welcome the fact that this instrument is WTO-compatible, a big demand from Renew Europe. Now, we need to dive into the details and strengthen the instrument where necessary," the group's Samira Rafaela said.

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