Last Tuesday, 14th January, European Court of Justice Advocate General Nicholas Emiliou issued an opinion which casts doubt over the legality of the EU Adequate Minimum Wages Directive.

The EU Minimum Wage Directive aims to improve pay and collective bargaining for millions of workers across the EU. Last year Denmark and Sweden brought a case to the European Court of Justice (ECJ) arguing that pay regulation is outside the EU’s competence. This opinion issued last week supports their position and recommends the Directive be annulled. While a final ruling won’t take place until the summer, this places the important legislation in jeopardy.

In 2024 the Irish Congress of Trade Unions had declared the transposition of the Directive its “number one priority”, repeatedly urging the government to enact legislation that would make it easier for unions to organise. 

Despite its name the EU Adequate Minimum Wage Directive goes beyond setting minimum wages, requiring member states to create action plans to enhance collective bargaining and implement measures to prevent anti-union practices. In Ireland the trade union emphasis has been on how the directive could be used to embed collective bargaining further. 
 
Reactions to last week’s developments have been characterised by consternation and sharp criticism from across the trade union movement in Ireland and Brussels.

Owen Reidy, General Secretary of the Irish Congress of Trade Unions expressed his concern over the Advocate General's opinion that the Directive should be annulled. 

Reidy said, “This is certainly a significant setback. It should be noted this opinion is non-binding and the matter will ultimately go to the European Court which will take a number of months and we would expect a definitive outcome later this year.”  Despite this, he emphasised that the Irish government must press ahead with preparations for the Directive’s ‘action plan,’ which is set to be finalised later this year. 
 
The European Public Services Union (EPSU), of which Fórsa is a member, called the opinion “biased”, while European Trade Union Confederation (ETUC) General Secretary Esther Lynch warned that the Advocate General’s opinion, if upheld, would severely harm workers and their unions, threatening the EU's commitment to social progress.  
 
“Allowing companies to compete on the lowest wages, without ensuring a floor of decency, and union busting is a one-way street to social dumping. Validating this line of argument would have dangerous and far-reaching consequences that would risk undermining years of pain-staking social progress in EU law.” 
 
The opinion was issued by the ECJ because the Danish Government has taken a legal challenge to the Directive. The opinion expressed support for Nordic countries, pushing back against what they view as EU overreach in managing their labour markets.  

The Danish Government decided to take a case to the European Court of Justice because of a fear that the directive opened the door for wages to be set outside of Denmark.

Nordic labour unions have historically been wary of EU labour standards regulation, particularly the idea of establishing an EU-wide minimum wage. While this may initially seem contradictory, it stems from a strong belief that wage regulation is most effectively managed through trade union negotiations.  
 
Denmark lacks an official minimum wage yet is famed for paying amongst the highest wages in Europe. This is because the country boasts a near 70% union density rate and its traditional tripartite system of collective bargaining has ensured workers fare relatively well from collective agreements that determine pay across even exploitative sectors like hospitality.

ICTU Vice President and Fórsa national secretary Katie Morgan voiced concern that a potential step back would impact Irish workers, saying: “This piece of European legislation was a significant development for workers in Ireland and all across Europe.”

Katie concluded: “ICTU will continue to urge the Irish Government to press ahead with transposition. We also urge the new Government to defend the Directive at EU level – this would give the new Government a perfect opportunity to demonstrate its support for workers.”

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