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Shall the EU have an EU framework on minimum wage? As Social Platform we said that we would like to see EU standards for a minimum wage as part of our EU minimum social floor. That is our intention – so that it can benefit all people who cannot make ends meet at the end of the month due to underpaid jobs. The shape of these standards will be the subject of intense discussions among our members in the coming weeks and months.

We have already started. We had a fascinating exchange last week between some of our members and our friends from the European Trade Union Confederation (ETUC) during our task force on minimum wage.

What I feel is that we are clearly at a crossroads in the development of our societies and the discussion around wages is a good illustration of tensions around four different purposes for wages.

What is the purpose of wages? In a more and more unequal society, is it only to guarantee a “minimum” to all workers so that they are not living in poverty? Or in a more equal society is it to ensure a fair share of the companies’ wealth among those who created it? Depending on your vision of society and the role you attribute to wages, you may want to qualify wages as “minimum”, “living wage”, “decent” or “fair”.

We want to respond to the current need for a minimum wage while we don’t want to challenge fair wage where it exists. The problem is that far too many workers don’t make a living from their wages and there is a need for a minimum. For example, in a country like Germany where collective bargaining is strongly rooted in society, the growing number of precarious workers has pushed trade unions themselves to call for a minimum wage that will be in place by 2015. Now the risk is that employers who currently pay higher wages may try to bend collective bargaining in the future down towards the minimum wage. Fair wage will not progress as fast as it used to do and it could be transformed into a minimum wage.

Minimum wage must be above minimum income. We are increasingly noticing a trend towards setting the minimum wage at the poverty level. This inevitably pushes minimum income below the poverty line since minimum wage should be higher than minimum income.

Would a minimum wage set at EU level be used for social dumping in Europe? Let’s take two countries with different wage levels (high and low). If we take the implementation of the Directive on posting of workers, the country with higher wages will not be able to complain against the country with lower wages if the latter are above a European minimum wage. This could create a race to the bottom, especially if the European minimum wage is set at a very low level.

With a minimum wage set at European level, we could be in a situation where we lose even if we win. Having a minimum wage that protects all workers from poverty does not necessarily imply a fair share of wealth in a more equal society. We know the kind of social union we want and it is set out in our strategic orientation. We want a better life for all and a more equal society. From this intention, we are going to carefully look at these issues when creating our concrete proposal to have European standards on minimum wage.

Let’s engage,

Pierre Baussand – Director