European Commission President Ursula von der Leyen addresses her first State of the European Union speech during a plenary session of the European Parliament as the coronavirus disease (COVID-19) outbreak continues, in Brussels, Belgium September 16, 2020. REUTERS/Yves Herman

EU executive to propose framework for minimal wage in EU

Business News

Reuters Staff

BRUSSELS (Reuters) - The European Commission will propose a framework for minimum wages in the 27-nation bloc, European Commission head Ursula von der Leyen said in a speech on Wednesday.

“For too many people, work no longer pays,” von der Leyen told the European Parliament in an annual policy speech. “Dumping wages destroys the dignity of work, penalises the entrepreneur who pays decent wages and distorts fair competition in the Single Market,” she said.

The issue is politically tricky so the Commission is not trying to set a single EU minimum wage or to impose one minimum wage setting system for all of the 27 countries in the bloc.

Instead, it wants to ensure there is a collective bargaining for wages in place, that different national systems have clear and stable criteria, that trade unions and employers are involved in the process, that there are few exemptions and that there are monitoring mechanisms in place.

“I am a strong advocate of collective bargaining and the proposal will fully respect national competencies and traditions,” von der Leyen said.

Minimum wages vary widely in EU countries -- in July 2020 ranged from 312 euros a month in Bulgaria to 2,142 euro a month in Luxembourg.