Minimum wage and collective bargaining rights are being debated on the floor of the Greek parliament this evening as the Νew Democracy’s new bill goes to a vote.
The bill proposed by New Democracy nominally looks to integrate the EU Minimum Wage Directive into Greek law, and readjust salaries.
What the bill does specifically is firm up current practice of minimum wage being determined by the government, rather than through negotiations between unions and employers, and introduces a specific algorithm to calculate the minimum wage.
Introducing the bill on Thursday, Greek Minister of labor Niki Kerameos noted that “The new mechanism established calculates the increase in the minimum wage on the basis of inflation. It takes into account how much prices increase and not in general, in particular for the lowest 20% of the income distribution. At the same time it also does the following– it ensures a dividend from economic growth for workers. That is, it links their wages to business profits.”
The Greek minimum wage is currently 830 euros per month, and Kerameos claimed it will rise to 950 by 2027, and more in the years after. The government argued the new algorithmic system will ensure fair wage increases in step with economic growth.
But many Greeks are struggling with their wages. Wages have remained stagnant for years, and inflation has shot up. Though the minimum wage is officially 830 euros, when factoring in the high consumer price index, calculations put the real wage at around 693 euros.
According to Greece’s statistical authority, 18.7% of the Greek population were at risk of poverty in 2023.
But the discussion on the parliament floor isn’t just about minimum wage alone, the debate is tied intrinsically to collective bargaining.
During Greece’s financial crisis over a decade ago, collective bargaining rights were dismantled under austerity measures. Unions say that where once they could argue collectively for higher wages, they have largely lost last right, and workers have seen incomes drop and inflation soar.
Today in Greece less than 30% of workers are covered by collective bargaining agreements.
On November 20th there was a national general strike with some of the most basic demands being wage increases, measures to tackle profiteering, and the restoration of collective bargaining.
Among other things, the EU Minimum Wage Directive stipulates that member states must push for collective bargaining coverage for 80% of workers. The new bill does not have a delineated plan on how to increase this percentage.
“you are falsifying the [EU Minimum Wage] directive. The directive aims at 80% collective agreements. […] You are making a choice that prevents collective agreements,” said newly-elected SYRIZA president Nikos Famellos on the parliament floor. The minimum wage is not a security for workers as it does not guarantee a decent living”.
Other opposition parties also fiercely critiqued the bill. “You talk about setting a minimum wage with an algorithm, which ‘makes the social partners decorative… Which employer will sit at the table when the algorithm does the work?” said PASOK member of parliament Dimitris Mantzos. “What do we need collective bargaining for then? What do we need politics for then? What do we want the Ministry of Labour for?” Mantzos asked.
The discussion of the bill will end late on Thursday, where it will go to a vote and almost certainly pass due to New Democracy’s majority position.
