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The term ‘minimum wage’ refers to the regulatory restriction on the lowest rate payable by employers to workers. Statutory minimum wages are regulated by formal laws or statutes. Collectively agreed minimum wages are stipulated within collective agreements between trade unions and employers. The term ‘national minimum wages’ is used when countries have one (or more) basic rates covering workers nationwide. They can be either statutory or collectively agreed.
Most EU Member States have a national minimum wage. But its level, adjustment mechanisms and coverage vary.
Eurofound’s e-survey on Living, working and COVID-19 shows that nearly half of households are struggling to make ends meet.
Eurofound provides regular updates on pay in the EU, including an annual study on how minimum wage rates have developed across the EU (as well as Norway), reviewing how national governments and social partners engage in setting new rates. The Agency also looks at the concept of a living wage, aimed at guaranteeing workers and their families a decent level of living and social participation in response to the inadequacy of income for many working households reliant on existing national minimum wage rates.
Eurofound’s annual review of minimum wages for 2025 is underway, with initial results published. The 2025 review includes a more detailed look at the question of how wage setters carry out their assessments of the adequacy of rates. Eurofound published a set of minimum wage country profiles in May 2024 which provide detailed background information on how minimum wages are set and regulated in the EU and Norway.
In an earlier study on pay in Europe in the 21st century, Eurofound explored the implications of a hypothetical scenario of a minimum wage coordinated at EU level and set at 60% of the median national wage.
The ongoing minimum wage debate is likely to be influenced by the COVID-19 pandemic and its aftermath, as many workers delivering essential services during the pandemic are those at the bottom of the pay ladder, while other low-wage workers were the first to be affected by unemployment. Eurofound’s e-survey on Living and Working in the EU documents the situation of European respondents and their post-pandemic concerns, including those on low incomes and those struggling to makes ends meet due to rising living costs. Minimum wages could play a policy role in stabilising incomes.
Following a request from the European Parliament and decision from the European Commission, Eurofound carried out a pilot project on the 'Role of the minimum wage in establishing the Universal Labour Guarantee' in the EU, running from 2021 to 2023. The project aim was to provide data and research evidence to feed into the monitoring of the Commission’s initiative on adequate minimum wages. Three distinct research modules covered the main objectives with specific outputs published for each.
A related but distinct concept to having a national minimum wage is that of a living wage, which is a wage designed to secure a basic but acceptable standard of living for its earner (and, in some cases, household dependents). Living wage campaigns are generally voluntary and rely on coalitions of interest groups, trade unions and employers working together. These campaigns can take on an advocacy role (Ireland) as well as an accreditation role (UK) where organisations are formally accredited as living wage employers. In line with the fair wage provisions set out in the European Pillar of Social Rights, Eurofound research aims to provide policymakers with a practical guide to the living wage concept.
Most EU Member States have a national (statutory) minimum wage in place, although its level, adjustment mechanisms and coverage vary. Austria, Denmark, Finland, Italy and Sweden have minimum wages set within collective agreements, while Cyprus has statutory rates for different occupations.
The European Pillar of Social Rights, proclaimed in 2017, sets out the EU’s commitment to fair wages for workers. This includes ensuring adequate wages for workers to allow them and their families to have a decent standard of living, safeguarding the ability of the low-skilled and young workers to find employment, while also making work financially attractive. The Action Plan to implement the Pillar, published in March 2021, has paved the way for a reform initiative for an EU minimum wage.
On 28 October 2020, the Commission put forward a proposal for an EU Directive on adequate minimum wages. This was followed by a political agreement between the European Parliament and the Member States on 7 June 2022. The Minimum Wages Directive was adopted in October 2022. It aims to improve standards of living with a view to achieving upward convergence and reducing in-work poverty, wage inequalities, and the gender pay gap. Member States were required to transpose the directive into national law by November 2024 (Article 17).
Eurofound’s work on minimum wages links in with the Commission’s 2025–2029 priority on supporting people, strengthening our societies and our social model.
