Filenews 9 June 2022 - by Adamos Adamou
The social partners will have another tool at their disposal in the negotiations that are expected to culminate in the coming weeks, for the introduction of a National Minimum Wage in Cyprus, following the political agreement reached late on Monday night between the European Parliament and the Member States, on the directive promoted by the Commission, with the aim of having adequate minimum wages throughout the EU territory.
The political agreement reached to promote the relevant directive prepared by the Commission from 2020 does not foresee the introduction of a single minimum wage in the EU, but sets the framework for the minimum wages applicable in each country to be sufficient. In this context, the directive being promoted places particular emphasis on the need to support and promote collective agreements.
As mentioned, this agreement is expected to be put before the social partners in the upcoming negotiations for the introduction of a National Minimum Wage in Cyprus, following the recent announcements by the President of the Republic himself that he will take the initiative on the matter himself. The reports of the President of the Republic of Cyprus were made 24 hours before the news of the death of Zeta Emilianidou who, before her health problem, which unfortunately proved fatal, had discussed the issue with the social partners several times in the framework of the Labour Advisory Body. In his statements, the PD reiterated the government's determination to conclude the consultations in June or at the latest in early July. In an interview with CyBC, President Anastasiades also said that the aim of the consultation will be to determine the minimum wage and the date of its implementation. Asked about this, he confirmed that due to the current crisis, a short period of a few months may be required for the implementation of this reform, thus confirming what "F" already wrote about a period of adjustment of businesses and the labour market in general for the National Minimum Wage.
The EU framework
The developments in our country are expected to precede what the EU is promoting on the issue, as the directive on which there has been political agreement, when it is published, will give two years to the Member States to implement it. Moreover, as mentioned, the Directive merely establishes a framework for the adequacy of legal minimum wages, "promoting collective bargaining on wage-setting and enhancing workers' effective access to protection in the form of a minimum wage in the EU", according to a Commission communication.
According to the EU, the main elements of the Directive are:
- Framework for setting and updating legal minimum wages: Member States with legal minimum wages should establish a good governance framework for setting and updating minimum wages. This process includes, inter alia, the following: clear criteria for the setting of the minimum wage (inter alia, purchasing power, taking into account the cost of living, the level, distribution and rate of wage growth, and national productivity) and the establishment of advisory bodies, in which the social partners will be able to participate.
- Promoting and facilitating collective bargaining on wages: The Directive supports collective bargaining in all Member States. This support is due to the fact that countries with collective bargaining covering a large part of the workforce tend to have a lower proportion of low-paid workers, lower wage inequality and higher wages. In addition, the Directive requires Member States to which the coverage of collective bargaining is less than 80% (to which Cyprus also belongs) to draw up an action plan for the promotion of collective bargaining.
- Improving monitoring and enforcement of protection in the form of a minimum wage: Member States should collect data on the coverage and adequacy of the minimum wage and ensure that workers have access to dispute resolution procedures and a right of appeal.
