Cross-party backing on stand against EU’s minimum wage proposal

Government has cross-party backing for its stand against a European Commission proposal to set minimum wage standards across the bloc.

In a reasoned opinion communicated to Brussels last month, the Maltese parliament said the Commission proposal did not respect the principle of subsidiarity.

The Brussels initiative wants to ensure that all workers in the EU have access to adequate minimum wage protection either in the form of statutory minimum wages or wages set in collective agreements.

But after analysing the proposal, parliament’s Foreign and European Affairs Committee said the directive seemed to impose a “one size fits all model” of minimum wage setting.

The Maltese parliament said wage conditions were a national prerogative and the EU lacked authority to legislate in this area.

“Since parts of the proposal are proposed to be binding for all member states, the Maltese parliament sees this as an infringement on national mechanisms for wage formation,” the reasoned opinion read.

The position enjoyed the backing of government and Opposition MPs on the committee and reflects the stand taken by the Maltese government, which argued that minimum wage standards and mechanisms should remain a competence of national authorities.

Parliament insisted that the setting of wages should remain a member state prerogative.

“While Malta shares the objective of the proposal that employees receive wages that allow a reasonable standard of living wherever they work in the EU, at the same time such objectives can be effectively achieved through actions by member states, particularly since the preconditions and systems for wage formation are different from one member state to another,” parliament said.

A European Commission study that accompanied the proposal found that Estonia, Malta, Ireland, Czechia, Latvia, Hungary and Romania had minimum wages below 40% of the national average wage.

The study also found that in 2018, in nine member states, the statutory minimum wage did not protect minimum wage earners against the risk of poverty. Malta was among these countries.

An individual is at the risk of poverty if he or she lives in a household with an income below 60% of net median household income, adjusted for household composition, in the same country.