The European Commission has planned to start this week the journey towards a minimum wage at european level, of the most outstanding of his new social agenda. The mechanism, which aims to have all countries set a minimum wage equivalent to 60% of the national median wage, form part of a battery of measures that will also include the creation of a secure european unemployment. Goal: promote economic convergence among the EU partners, to reduce the risk of wage dumping in a labour market without borders, and rescue a part of the 110 million europeans at risk of poverty.
The president of the European Commission, and Ursula von der Leyen, promised the European Parliament to put in place in less than 100 days-an ambitious agenda for social and environmental. Nothing more to take up the position on 1 December, the German began to fulfill the promises which enabled him to save the vote of his appointment by only nine votes difference.
minimum Wage in Europe
net income in euros per year
27.341
Denmark
26.199
Norway
21.489
Luxembourg
18.750
the Netherlands
18.535
Ireland
18.312
Belgium
18.184
United Kingdom
17.899
Finland
17.115
Austria
16.679
Italy
15.912
Sweden
14.194
France
13.810
Germany
11.573
Spain
9.573
Cyprus
8.178
Malta
8.004
Slovenia.
7.476
Portugal
6.552
Greece
6.197
Estonia
5.160
Slovakia
4.857
Croatia
4.559
Poland
4.290
Czech R.
4.154
Latvia
4.029
Lithuania
3.704
Hungary
3.252
Romania
2.902
Bulgaria
Source: Eurofound.
THE COUNTRY
minimum Wage in Europe
net income in euros per year
27.341
Denmark
26.199
Norway
21.489
Luxembourg
18.750
the Netherlands
18.535
Ireland
18.312
Belgium
18.184
United Kingdom
17.899
Finland
17.115
Austria
16.679
Italy
15.912
Sweden
14.194
France
13.810
Germany
11.573
Spain
9.573
Cyprus
8.178
Malta
8.004
Slovenia.
7.476
Portugal
6.552
Greece
6.197
Estonia
5.160
Slovakia
4.857
Croatia
4.559
Poland
4.290
Czech R.
4.154
Latvia
4.029
Lithuania
3.704
Hungary
3.252
Romania
2.902
Bulgaria
Source: Eurofound.
THE COUNTRY
minimum Wage in Europe
net income in euros per year
27.341
Denmark
26.199
Norway
21.489
Luxembourg
18.750
the Netherlands
18.535
Ireland
18.312
Belgium
18.184
United Kingdom
17.899
Finland
17.115
Austria
16.679
Italy
15.912
Sweden
14.194
France
13.810
Germany
11.573
Spain
9.573
Cyprus
8.178
Malta
8.004
Slovenia.
7.476
Portugal
6.552
Greece
6.197
Estonia
5.160
Slovakia
4.857
Croatia
4.559
Poland
4.290
Czech R.
4.154
Latvia
4.029
Lithuania
3.704
Hungary
3.252
Romania
2.902
Bulgaria
Source: Eurofound.
THE COUNTRY
on 10 December, the Commission has already approved the Compact Green, that sets the objective of making Europe the first continent to achieve the neutrality in emissions of CO2. After that progress on the environmental agenda, Von der Leyen plans to start this week’s journey of their social agenda, the more susceptible still cause great divisions and clashes between members of the Union.
The president of the Commission has been assigned the portfolio of Employment to the socialist luxembourg Nicolas Schmit, a strong supporter of establishing both a minimum wage as a mechanism of insurance or reinsurance of unemployment. Schmit also advocates the introduction of a minimum income that guarantees to all the citizens in a vulnerable situation decent living conditions. The team Schmit aims to advance all of these proposals as quickly as possible, without waiting for them to have a mandate that covers up to 2024.
The battle to pass any of these measures is announced virulent. The proposal of the minimum wage concerned in several countries. The of central and Eastern Europe, with labour costs below average, they are afraid that the european framework is to reduce its competitiveness.
The minimum annual salary net in countries such as Poland, Hungary, Czech Republic or Slovakia does not reach eur 5,000 per year while in Bulgaria or Romania round 3,000, according to Eurofound, the european agency responsible for improving the conditions of life. The data show that the minimum wage in Germany, France or Italy exceeds € 13,000, and in Spain, the 11,000 euros (12.600 euros gross per year or € 900 on 14 pays per year).
The difference is exploited in sectors with the possibility of displacement of workers, such as transportation. The veteran partners of the EU are pressuring Brussels to combat the wage dumping, with the tightening of the rules on posted workers, while the Governments of the countries of the east are advocating for keeping a relaxation that is favorable.
Traditions
The minimum wage, the european concern on the part of community partners where there exists at the national level (such as Italy or Cyprus) or which are fixed through collective bargaining without the intervention of the authorities (in the nordic countries). Some fear being forced to adopt a mechanism alien to its tradition of labor and others fear that the european framework to undermine a system that works with good results.
“The goal is not to set a minimum wage common to all the EU”, reassuring sources of the Commission on the eve of publishing the consultation document on the future european mechanism. “Any proposal will allow for that minimum wages are set in accordance with the traditional practices of each country, either through collective bargaining or through legal regulations”. Brussels acknowledges that the formula of some nordic countries, where rates of union membership are much higher than in the rest of Europe, has given “excellent results”. But he believes that still there is room for improvement in certain partners, and that the goal is for States to “take note of the best practices applied in each place”.
despite the calming signals, which emits Brussels, the draft legislation which they expect to achieve within a few months is ambitious for many countries, including Spain. The objective of the Commission is that the minimum wage scope in each country at least 60% of the average wage. A goal that the new Spanish Government is expected to meet, as soon, at the end of the term that just pull off (that is to say, in 2024), according to the commitment announced by Pedro Sánchez in the endowment session.
More controversial whether it should be the next step in the social agenda of Von der Leyen, which points to the creation of a european coverage of unemployment insurance. The commissioner Schmit is responsible for designing a Mechanism of reinsurance that would allow to mutualize part of the bill of unemployment in times of profound crises.
unemployment Insurance common
The device is not intended to establish a safe european permanent unemployment, but a safety net against economic shocks are asymmetric. The countries severely hit —as Spain during the recent crisis, when the bill of unemployment shot up to 30,000 million euros a year— would receive community aid to cover that game. The goal is to avoid that the States are forced to cut other budget chapters, in particular public investment. In the recent crisis, the lack of such a european stabilization mechanism triggered a spiral cut investment and increased social spending further aggravated the ravages of the recession.“This is not to organize a system of permanent transfer, but to ensure that, in case of asymmetric shock, the economy is affected not busting into a bottomless pit and that the people of that country have access to a network of security even if the State has had great difficulties to provide it,” said Schmit during the hearing before the European Parliament prior to their appointment.
A report of the european Parliament of April 2019 estimated that if during the crisis of 2008 there had been a european regime of unemployment, “it would have stabilized the income of the households (…) and would have been attenuated in 71.000 million euros over four years, the loss of GDP in the hardest-hit member States of the euro area, that is to say, about 17,000 million euros per year.”
The Reinsurance european unemployment scares, however, the main net contributors of the EU, with the Netherlands at the front. These partners fear a transfer of budgetary resources to the southern partner, where the high unemployment is structural in nature or endemic in certain areas.
Spain and France, in contrast, have the creation of the Reinsurance among its priorities for this european parliamentary term. And the initiative has the strong support of the Commission Von der Leyen, a good part of the European Parliament and even the German Government.
