Round Table. Mission impossible? How to increase collective bargaining coverage in Germany and the EU

Abstract

The Directive on fair and adequate minimum wages represents a paradigm shift in EU economic governance. It marks a profound reorientation away from an economic growth strategy that priori-tises liberalisation of labour markets and decentralisation of collective bargaining, which has dom-inated the policy orientation of most EU Member States and the European Commission for at least 20 years. The Directive reinforces the governance and the level of statutory minimum wages in EU Member States. In a second step, the Directive requests that Member States support collective bargaining and find concrete measures to increase bargaining coverage for those countries where coverage is less than 80 per cent. This second aspect is just as relevant to the Directive and even more ambitious than the first. While statutory minimum wages are in the control of governments, collective bargaining is based on voluntary negotiations between trade unions and employers’ associations. The role of governments and public policy towards collective bargaining is limited and only indirect. In this comment I will focus on the latter aspect of increasing collective bargaining coverage, but will argue first that the wider picture of a changing EU growth strategy is important to understand the significance of the shift. I will, secondly, discuss ways of strengthening collective bargaining, with a focus on the German case.