Legal provisions of COM(2020)682 - Adequate minimum wages in the EU - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2020)682 - Adequate minimum wages in the EU. |
|---|---|
| document | COM(2020)682  |
| date | October 19, 2022 |
Contents
CHAPTER I - GENERAL PROVISIONS
Article 1
Subject matter
1. With a view to improving living and working conditions in the Union, in particular the adequacy of minimum wages for workers in order to contribute to upward social convergence and reduce wage inequality, this Directive establishes a framework for:
| (a) | adequacy of statutory minimum wages with the aim of achieving decent living and working conditions; |
| (b) | promoting collective bargaining on wage-setting; |
| (c) | enhancing effective access of workers to rights to minimum wage protection where provided for in national law and/or collective agreements. |
2. This Directive shall be without prejudice to the full respect for the autonomy of the social partners, as well as their right to negotiate and conclude collective agreements.
3. In accordance with Article 153(5) TFEU, this Directive shall be without prejudice to the competence of Member States in setting the level of minimum wages, as well as to the choice of the Member States to set statutory minimum wages, to promote access to minimum wage protection provided for in collective agreements, or both.
4. The application of this Directive shall be in full compliance with the right to collective bargaining. Nothing in this Directive shall be construed as imposing an obligation on any Member State:
| (a) | where wage formation is ensured exclusively via collective agreements, to introduce a statutory minimum wage; or |
| (b) | to declare any collective agreement universally applicable. |
5. The acts by which a Member State implements the measures concerning minimum wages of seafarers periodically set by the Joint Maritime Commission or another body authorised by the Governing Body of the International Labour Office shall not be subject to Chapter II of this Directive. Such acts shall be without prejudice to the right to collective bargaining and to the possibility to adopt higher minimum wage levels.
Article 2
Scope
This Directive applies to workers in the Union who have an employment contract or employment relationship as defined by law, collective agreements or practice in force in each Member State, with consideration to the case-law of the Court of Justice.
Article 3
Definitions
For the purposes of this Directive, the following definitions apply:
| (1) | ‘minimum wage’ means the minimum remuneration set by law or collective agreements that an employer, including in the public sector, is required to pay to workers for the work performed during a given period; |
| (2) | ‘statutory minimum wage’ means a minimum wage set by law or other binding legal provisions, with the exclusion of minimum wages set by collective agreements that have been declared universally applicable without any discretion of the declaring authority as to the content of the applicable provisions; |
| (3) | ‘collective bargaining’ means all negotiations which take place according to national law and practice in each Member State between an employer, a group of employers or one or more employers’ organisations on the one hand, and one or more trade unions on the other, for determining working conditions and terms of employment; |
| (4) | ‘collective agreement’ means a written agreement regarding provisions on working conditions and terms of employment concluded by the social partners that have the capacity to bargain on behalf of workers and employers respectively according to national law and practice, including collective agreements that have been declared universally applicable; |
| (5) | ‘collective bargaining coverage’ means the share of workers at national level to whom a collective agreement applies, calculated as the ratio of the number of workers covered by collective agreements to the number of workers whose working conditions may be regulated by collective agreements in accordance with national law and practice. |
Article 4
Promotion of collective bargaining on wage-setting
1. With the aim of increasing the collective bargaining coverage and of facilitating the exercise of the right to collective bargaining on wage-setting, Member States, with the involvement of the social partners, in accordance with national law and practice, shall:
| (a) | promote the building and strengthening of the capacity of the social partners to engage in collective bargaining on wage-setting, in particular at sector or cross-industry level; |
| (b) | encourage constructive, meaningful and informed negotiations on wages between the social partners, on an equal footing, where both parties have access to appropriate information in order to carry out their functions in respect of collective bargaining on wage-setting; |
| (c) | take measures, as appropriate, to protect the exercise of the right to collective bargaining on wage-setting and to protect workers and trade union representatives from acts that discriminate against them in respect of their employment on the grounds that they participate or wish to participate in collective bargaining on wage-setting; |
| (d) | for the purpose of promoting collective bargaining on wage-setting, take measures, as appropriate, to protect trade unions and employers’ organisations participating or wishing to participate in collective bargaining against any acts of interference by each other or each other’s agents or members in their establishment, functioning or administration. |
2. In addition, each Member State in which the collective bargaining coverage rate is less than a threshold of 80 % shall provide for a framework of enabling conditions for collective bargaining, either by law after consulting the social partners or by agreement with them. Such a Member State shall also establish an action plan to promote collective bargaining. The Member State shall establish such an action plan after consulting the social partners or by agreement with the social partners, or, following a joint request by the social partners, as agreed between the social partners. The action plan shall set out a clear timeline and concrete measures to progressively increase the rate of collective bargaining coverage, in full respect for the autonomy of the social partners. The Member State shall review its action plan regularly, and shall update it if needed. Where a Member State updates its action plan, it shall do so after consulting the social partners or by agreement with them, or, following a joint request by the social partners, as agreed between the social partners. In any event, such an action plan shall be reviewed at least every five years. The action plan and any update thereof shall be made public and notified to the Commission.
CHAPTER II - STATUTORY MINIMUM WAGES
Article 5
Procedure for setting adequate statutory minimum wages
1. Member States with statutory minimum wages shall establish the necessary procedures for the setting and updating of statutory minimum wages. Such setting and updating shall be guided by criteria set to contribute to their adequacy, with the aim of achieving a decent standard of living, reducing in-work poverty, as well as promoting social cohesion and upward social convergence, and reducing the gender pay gap. Member States shall define those criteria in accordance with their national practices in relevant national law, in decisions of their competent bodies or in tripartite agreements. The criteria shall be defined in a clear way. Member States may decide on the relative weight of those criteria, including the elements referred to in paragraph 2, taking into account their national socioeconomic conditions.
2. The national criteria referred to in paragraph 1 shall include at least the following elements:
| (a) | the purchasing power of statutory minimum wages, taking into account the cost of living; |
| (b) | the general level of wages and their distribution; |
| (c) | the growth rate of wages; |
| (d) | long-term national productivity levels and developments. |
3. Without prejudice to the obligations set out in this Article, Member States may additionally use an automatic mechanism for indexation adjustments of statutory minimum wages, based on any appropriate criteria and in accordance with national laws and practices, provided that the application of that mechanism does not lead to a decrease of the statutory minimum wage.
4. Member States shall use indicative reference values to guide their assessment of adequacy of statutory minimum wages. To that end, they may use indicative reference values commonly used at international level such as 60 % of the gross median wage and 50 % of the gross average wage, and/or indicative reference values used at national level.
5. Member States shall ensure that regular and timely updates of statutory minimum wages take place at least every two years or, for Member States which use an automatic indexation mechanism as referred to in paragraph 3, at least every four years.
6. Each Member State shall designate or establish one or more consultative bodies to advise the competent authorities on issues related to statutory minimum wages, and shall enable the operational functioning of those bodies.
Article 6
Variations and deductions
1. Where Member States allow for different rates of statutory minimum wage for specific groups of workers or for deductions that reduce the remuneration paid to a level below that of the relevant statutory minimum wage, they shall ensure that those variations and deductions respect the principles of non-discrimination and proportionality, the latter including the pursuit of a legitimate aim.
2. Nothing in this Directive shall be construed as imposing an obligation on Member States to introduce variations of or deductions from statutory minimum wages.
Article 7
Involvement of the social partners in the setting and updating of statutory minimum wages
Member States shall take the necessary measures to involve the social partners in the setting and updating of statutory minimum wages in a timely and effective manner that provides for their voluntary participation in the discussions throughout the decision-making process, including through participation in the consultative bodies referred to in Article 5(6) and in particular as concerns:
| (a) | the selection and application of criteria for the determination of the level of the statutory minimum wage, and the establishment of an automatic indexation formula and its modification where such formula exists, referred to in Article 5(1), (2) and (3); |
| (b) | the selection and application of indicative reference values referred to in Article 5(4) for the assessment of the adequacy of statutory minimum wages; |
| (c) | the updates of statutory minimum wages referred to in Article 5(5); |
| (d) | the establishment of variations and deductions in statutory minimum wages referred to in Article 6; |
| (e) | the decisions both on the collection of data and the carrying out of studies and analyses to provide information to authorities and other relevant parties involved in statutory minimum wage-setting. |
Article 8
Effective access of workers to statutory minimum wages
Member States shall, with the involvement of the social partners, take the following measures to enhance the effective access of workers to statutory minimum wage protection as appropriate, including, where appropriate, strengthening its enforcement:
| (a) | provide for effective, proportionate and non-discriminatory controls and field inspections conducted by labour inspectorates or the bodies responsible for the enforcement of statutory minimum wages; |
| (b) | develop the capability of enforcement authorities, in particular through training and guidance, to proactively target and pursue non-compliant employers. |
CHAPTER III - HORIZONTAL PROVISIONS
Article 9
Public procurement
In accordance with Directives 2014/23/EU, 2014/24/EU and 2014/25/EU, Member States shall take appropriate measures to ensure that, in the awarding and performance of public procurement or concession contracts, economic operators and their subcontractors comply with the applicable obligations regarding wages, the right to organise and collective bargaining on wage-setting, in the field of social and labour law established by Union law, national law, collective agreements or international social and labour law provisions, including ILO Freedom of Association and the Protection of the Right to Organise Convention No 87 (1948) and ILO Right to Organise and Collective Bargaining Convention No 98 (1949).
Article 10
Monitoring and data collection
1. Member States shall take the appropriate measures to ensure that effective data collection tools are in place to monitor minimum wage protection.
2. Member States shall report the following data and information to the Commission every second year, before 1 October of the reporting year:
| (a) | the rate and development of collective bargaining coverage; |
| (b) | for statutory minimum wages:
|
| (c) | for minimum wage protection provided for only in collective agreements:
|
The Member States that are subject to the reporting obligations referred to in first subparagraph, point (c) shall be required to report the data referred to in point (i) thereof at least with regard to sectoral, geographical and other multi-employer collective agreements, including collective agreements that have been declared universally applicable.
Member States shall provide the statistics and information referred to in this paragraph disaggregated by gender, age, disability, company size and sector as far as available.
The first report shall cover 2021, 2022 and 2023 and shall be delivered by 1 October 2025. The Member States may omit statistics and information which are not available before 15 November 2024.
3. The Commission shall analyse the data and information transmitted by the Member States in the reports referred to in paragraph 2 of this Article and in the action plans referred to in Article 4(2). It shall report in this regard every second year to the European Parliament and to the Council and shall simultaneously publish the data and information transmitted by Member States.
Article 11
Information on minimum wage protection
Member States shall ensure that information regarding statutory minimum wages as well as minimum wage protection provided for in universally applicable collective agreements, including information on redress mechanisms, is publicly available, where necessary in the most relevant language, as determined by the Member State, in a comprehensive and easily accessible way, including to persons with disabilities.
Article 12
Right to redress and protection against adverse treatment or consequences
1. Member States shall ensure that, without prejudice to specific forms of redress and dispute resolution provided for, where applicable, in collective agreements, workers, including those whose employment relationship has ended, have access to effective, timely and impartial dispute resolution and a right to redress, in the case of infringements of rights relating to statutory minimum wages or relating to minimum wage protection, where such rights are provided for in national law or collective agreements.
2. Member States shall take the measures necessary to protect workers and workers’ representatives, including those who are trade union members or representatives, from any adverse treatment by the employer and from any adverse consequences resulting from a complaint lodged with the employer or resulting from any proceedings initiated with the aim of enforcing compliance in the case of infringements of rights relating to minimum wage protection, where such rights are provided for in national law or collective agreements.
Article 13
Penalties
Member States shall lay down the rules on penalties applicable to infringements of rights and obligations falling within the scope of this Directive, where those rights and obligations are provided for in national law or collective agreements. In Member States without statutory minimum wages, those rules may contain or be limited to a reference to compensation and/or contractual penalties provided for, where applicable, in rules on enforcement of collective agreements. The penalties provided for shall be effective, proportionate and dissuasive.
CHAPTER IV - FINAL PROVISIONS
Article 14
Dissemination of information
Member States shall ensure that the national measures transposing this Directive, together with the relevant provisions already in force relating to the subject matter as set out in Article 1, are brought to the attention of workers and employers, including SMEs.
Article 15
Evaluation and review
By 15 November 2029, the Commission shall, after consulting the Member States and the social partners at Union level, conduct an evaluation of this Directive. The Commission shall submit thereafter a report to the European Parliament and the Council reviewing the implementation of this Directive and propose, where appropriate, legislative amendments.
Article 16
Non-regression and more favourable provisions
1. This Directive shall not constitute valid grounds for reducing the general level of protection already provided to workers within Member States, in particular with regard to the lowering or abolition of minimum wages.
2. This Directive shall not affect Member States’ prerogative to apply or to introduce laws, regulations or administrative provisions which are more favourable to workers or to encourage or permit the application of collective agreements which are more favourable to workers. It shall not be construed as preventing Member States from increasing statutory minimum wages.
3. This Directive is without prejudice to any rights conferred on workers by other legal acts of the Union.
Article 17
Transposition and implementation
1. Member States shall adopt the measures necessary to comply with this Directive by 15 November 2024. They shall immediately inform the Commission thereof.
When Member States adopt those measures, they shall contain a reference to this Directive or be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by Member States.
2. Member States shall communicate to the Commission the text of the main measures of national law which they adopt in the field covered by this Directive.
3. Member States shall take, in accordance with their national law and practice, adequate measures to ensure the effective involvement of the social partners with a view to the implementation of this Directive. To that end, they may entrust the social partners with that implementation, in all or in part, including with regard to the establishment of an action plan in accordance with Article 4(2), where the social partners jointly request to do so. In so doing, the Member States shall take all necessary steps to ensure that the obligations laid down in this Directive are complied with at all times.
4. The communication referred to in paragraph 2 shall include a description of the involvement of the social partners in the implementation of this Directive.
Article 18
Entry into force
This Directive shall enter into force on the twentieth day following its publication in the Official Journal of the European Union.
Article 19
Addressees
This Directive is addressed to the Member States.