The European Union’s newly adopted Minimum Wage Directive (EMWD) aims to reshape labour standards across Europe by targeting wage inequality and strengthening collective bargaining. Approved in October 2022, the Directive responds to calls for fairer labour practices, especially after years of austerity measures and “race to the bottom” approaches.
To support its effective implementation, industriAll Europe has released a set of comprehensive guidelines to help national unions use the EMWD to expand collective bargaining and secure fair wages. The timing is critical, as Member States are required to adopt the Directive into national law by 15 November 2024, and they are meant to design National Plans to increase Collective Bargaining Coverage along the next year.
Aiming for Fairer Wages and Greater Bargaining Power
The EMWD introduces a dual approach: setting fair minimum wage standards and enhancing collective bargaining. For wages, the Directive suggests linking minimum wages to economic indicators, recommending thresholds of 60% of each country’s median wage or 50% of its average wage – a “double decency threshold”, currently met only by Slovenia. Countries with collective bargaining coverage below 80% must prepare National Action Plans by November 2025, detailing steps to improve bargaining coverage. At this date, only 8 member states are above that threshold: Austria, Italy, Spain, Denmark, Sweden, Finland, France and Belgium.
Challenges for Implementation in Central and Eastern Europe
IndustriAll Europe’s new guidelines emphasise the specific challenges faced by Central and Eastern European countries, where low union density and limited employer cooperation have historically undermined collective bargaining. In Poland, for example, only 13% of workers are covered by collective agreements, and unions report “hostile” policies from the government. Bulgaria’s coverage is similarly low at 28%, with companies generally reluctant to engage in negotiations despite recent anti-union-busting laws. In Slovakia, the low rate of employer affiliation with employers organisations combined with a resistance to sectoral agreements makes collective bargainig even more challenging. IndustriAll Europe’s guidelines underscore the need for systemic change across these regions and aim to empower unions to use the EMWD to address these issues.
Social Conditionalities and Worker Protections
To promote compliance, the Directive also suggests incorporating fair wage and bargaining standards in public procurement contracts, an approach that could encourage companies to adopt fairer labour practices. Public contracts as a tool for fair labour practices send a powerful message – that companies which respect workers, and their rights, should be prioritised in government procurement.
The Directive also provides protections against union busting and wage discrimination. IndustriAll Europe’s guidelines call for strong national anti-discrimination laws and measures to protect union representatives from retaliation, a significant support for unions facing employer opposition. Furthermore, the Directive provides a framework to build capacities, both on the side of the trade unions and on the employers, to avoid employers’ reluctance to negotiate.
Building Towards 2030
With the release of these new guidelines, industriAll Europe provides unions with the tools and strategies to push for strong national implementation of the Directive. As the November 2024 deadline approaches, unions are encouraged to leverage the EMWD to advance wage increases and bargaining power.
The Directive is part of a larger vision to improve labour standards across Europe. Progress will be assessed every five years, holding governments accountable for real improvements in worker representation and wage equity. How the European Commission will ensure the correct transposition of the EMWD remains unclear. Therefore, the European trade union movement must take a firm stance and advocate for the strongest possible implementation.
“This Directive is a great opportunity to build trade union power, to enhance the framework for bringing the employers to the negotiations, and to increase sectoral bargaining ”, said Isabelle Barthès, Deputy General Secretary of industriAll Europe.
“We need to continue advocating strongly at national level. Now is the moment to influence the design of the National Actions Plans to increase collective bargaining”.
Read the guidelines here: EN FR DE HU HR CZ PL RO BG