On fair wages and minimum wages

ILO Director General Guy Ryder visited in Finland 25.-26. of November. He met the Finnish social partners and discussed about the actual matters, especially about the ILO matters.

We from trade union side lifted up upon the discussion the issue of right to strike.

The Finnish employers reiterated once again their position that they agree with the employer’s group in stating that right to strike is a national right.

We on the trade union side opposed of course the employer’s view.

The discussion about this matter during the visit Director General shows us how difficult matter we do have in our hands. Even in Finland which have been seen to be a model country of social dialogue the employer is that strongly on the opposite side in this matter.


I believe that the next Congress of ETUC would be very important. First time for many years ETUC can be active player in EU not only defensive partner. We have our plan for investments and sustainable growth and hopefully we will get also more and better jobs.

In trade unions we believe that everyone should have their share about growth and welfare. In draft text for next ETUC Congress is said that:

”The EU should adopt a clear and ambitious social agenda which would include initiatives on and/or standards for:

Payment of fair wages to all workers. Gradual implementation of a wage floor through legally enforceable minimum wages and/or collective bargaining. The Council of Europe definition of what is a fair wage offers a guiding principle.”


I have to say a few words of the Finnish point of view to the discussion of the minimum wage issue. I have to do this due to the fact that that this discussion has been used and will be used in Finland by the employers as a part of the structural reform of the labour market.

The question of how to define and agree on minimum wages is quite difficult issue.

Not only because it is important to guarantee decent wages for all, but also because it has reflections to that how people evaluate trade unions. Let me explain what I mean by that.

Globalisation and structural changes make our work difficult and unions in many countries have lost big number of members.

We have two ways to set wages: through negation or through legislation. If we don´t have enough negotiating power there is a temptation to look for minimum wages through legislation. However, I do not believe that legislation could be a channel to get better wages in the long run. It is also inflexible and slowly reacting system. Therefore the levels of minimum wages would evidently weaken in the coming years. It might also have negative effects to union density.

Trade unions in every country try to develop their labour market systems such a way they find to be best for their circumstances. There is no problem if we negotiate minimum wage regulations at national level. At EU-level the situation is different and we don´t support it. EU countries differs from each other, each country has its own history and culture – as well as their own labour market histories and cultures. It would not be easy to agree to an imperative law or even a common framework of minimum wages that would benefits all.

In Finland we have a high union membership density among employees and employers. We have a well working collective bargaining system. Most of the collective agreements include a contract of wage levels, including minimum wages as well. We also have a principle of common obligation. It means that workers who are not members in trade unions have the same rights through collective agreements as the union members have.

We hear nowadays more often from the employer side in Finland that we should put an end to the principle of common obligation and start to agree on minimum wages through legislation. They want less regulation through collective agreements and more possibilities to agree at local level.

They also watch very carefully what the ETUC has to say about these issues.

It is very important for us that there are not any such formulations in the ETUC documents and statements which can be misinterpreted to be supportive for minimum wages through legislation at EU-level.

Finally, Finnish member confederations of ETUC support the compromise text which was formulated in the winter school in 2012 and adopted by the ETUC Executive Committee in 2012 as a part of the Social Compact for Europe in 2012.

Antti Palola STTK – Finland
Speech in the ETUC Executive Committee 2.12.2014