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Theses for a European Minimum Wage Policy

GUE/NGL in Cooperation with Forum Social Europe Conference on “The European Social Model” Brussels, 9-10 November 2005. Theses for a European Minimum Wage Policy. Dr. Thorsten Schulten. A joint Proposal made by Researchers from WSI (Germany), Denknetz (Switzerland) and IRES (France).

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Theses for a European Minimum Wage Policy

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  1. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model” Brussels, 9-10 November 2005 Theses for a European Minimum Wage Policy Dr. Thorsten Schulten A joint Proposal made by Researchers from WSI (Germany), Denknetz (Switzerland) and IRES (France)

  2. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 1. The Fundamental Meaning ofMinimum Wages 2. Minimum Wages in Europe – a Brief Overview 3. Proposals for a European Minimum Wage Policy

  3. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Fundamental Idea of Minimum Wages: “No business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By living wages I mean more than a bare subsistence level — I mean the wages of a decent living.” U.S.-PräsidentFranklin D. Roosevelt (1933)

  4. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Normative Foundations of an „Equitable“ or „Fair“ Wage: United Nations Declaration of Human Rights (1948) ILO Conventions on Minimum Wages (26, 131) European Social Charta of the Council of Europe (1961) Community Charter of Fundamental Social Rights for Workers of the EU (1989) National Constitutions (e.g. Belgium, Italy, Spain, Portugal, Czech Republic)

  5. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Social Aims of Minimum Wages Defining a socially accepted Minimum Wage Level  Limiting the Low Wage Sector  Preventing Working Poor  Having a more Egalitarian Wage Structure Fighting Gender Pay Gap and other Forms of Wage Discrimination

  6. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Economic Function of Minimum Wages Preventing Downward Competition on Wages  Promoting more Productivity-oriented Strategies at Company -Level  Stabilising Private Demand  Counteracting Deflation  Having almost no direct Impact on Employment !!!

  7. Statutory Minimum Wage per Hour in Euro (November 2005)

  8. Statutory Minimum Wage per Months in Euro (November 2005)

  9. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Mode of Determination and Adjustment of Statutory Minimum Wages • „Pure Political“ Determination by the State (USA) • Political Determination by the State with Institutionalised Consultation of Trade Unions and Employers (UK, Spain, Portugal) • National Bipartite or Tripartite Bargaining (Belgium, Greece, Ireland) • Indexation of Minimum Wages to the Development of Prices and/or Average Wages(France, BeNeLux-Countries, Poland)

  10. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Functional Equivalents in Countries with no Statutory Minimum Wages Scandinavian Countries:High Trade Union Density Austria: High Bargaining Coverage through Obligatory Membership within Employers’ Association  Italy: High Bargaining Coverage de facto guaranteed by the Constitution Germany: No Functional Equivalent !!!

  11. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Theses for a European Minimum Wage Policy A Joint Proposal made by Researchers fromWirtschafts- und Sozialwissenschaftliches Institut (WSI) in der Hans-Böckler-Stiftung, Germany Denknetz, Switzerland Institut de Recherches Economiques et Sociales (IRES), France

  12. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Wage Policy in Europe Wages purely viewed as Cost Factors  Wages as a Key Variable for Competitiveness General Tendency towards Wage Moderation  Increasing Wage Dispersion  Extension of Low Wage Sector and Working Poor

  13. Low Pay Sector in Europe 2000 (in % of all Employees) Source: European Commission

  14. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Community Charter of Fundamental Social Rights for Workers of the EU from 1989 Right for an equitable wage: “All employment shall be fairly remunerated. To this end, in accordance with arrangements applying in each country, workers shall be assured of an equitable wage i.e. a wage sufficient to enable them to have a decent standard of living“ (Title 1, 5).

  15. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 European Norm for National Minimum Wages 60% of the Average National Wage 50% as a Short-Term Interim Target

  16. Monthly Minimum Wage in % of Monthly Average Wage in Industries and Services 2004

  17. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Implementation of a European Minimum Wage Policy Political Level: EU Open Method of Coordination Trade Union Level: European Coordination of Collective Bargaining

  18. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Implementation of a European Minimum Wage Policy via the Open Method of Coordination European level: Determination of joint Targets and Time Schedules  Monitoring and Evaluation of National Initiatives National level:  National Action Plans to reach European Targets

  19. GUE/NGL in Cooperation with Forum Social EuropeConference on “The European Social Model”Brussels, 9-10 November 2005 Implementation of a European Minimum Wage Policy via Coordination of Collective Bargaining European level: Determination of joint Targets for National Bargaining  Monitoring and Evaluation of National Bargaining Policy National level:  National Trade Union Campaigns to reach European Targets

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