Following the recent ruling by the European Court of Justice on the EU directive regarding adequate minimum wages, Luxembourg's Minister of Labour, Georges Mischo, has expressed openness to making targeted adjustments to how the minimum wage is calculated.

One of the key questions raised by the judgment is whether public sector salaries should be taken into account when setting the national minimum wage. Mischo's reaction to the ruling suggests that this could now be reconsidered.

Mischo noted that the decision brings greater clarity, though his ministry still needs to analyse it in more depth. Former EU Commissioner Nicolas Schmit, who authored the directive, also weighed in, stating in an RTL interview on Tuesday that the judgment confirmed the direction taken by the European Commission.

The Court struck down two provisions but upheld the core of the directive, including the use of specific reference points to calculate minimum wages. These benchmarks suggest that the minimum wage should correspond to either 50% of the average national wage or 60% of the median wage.

Until now, Mischo had excluded civil service salaries from the equation, fearing that their inclusion would significantly increase the minimum wage. That decision drew criticism from trade unions and Schmit.

On Tuesday, Mischo signalled that this position was not set in stone. He explained that if excluding public salaries was no longer seen as the appropriate method, the ministry would be ready to reconsider it. He added that he was not fixed on any particular approach and was willing to adapt.

Mischo also argued that other factors should be taken into account in wage policy discussions, such as the value of public services provided free of charge, including transport, education, and childcare support like the maisons relais. In his view, these should be part of the broader reflection when considering minimum wage adjustments.

Collective bargaining

The Court's ruling also confirms the validity of the action plan to boost collective bargaining coverage, which aims to extend collective agreements to 80% of companies in Europe.

Mischo reiterated that trade unions will retain their exclusive right to negotiate and sign such agreements. He dismissed the idea that company-level agreements could be used to bypass unions by allowing direct negotiations between employers and staff on aspects of work organisation.

According to Mischo, the Labour Ministry is continuing to explore ways to expand collective bargaining coverage, although he did not specify which measures were being considered.

The action plan for collective agreements is now expected to be discussed again with social partners. Meanwhile, the draft law on minimum wage is already with the relevant parliamentary committee. After a six-month pause, discussions on the dossier are set to resume.