The decision of the Court of Justice of the European Union (CJEU) regarding Directive (EU) 2022/2041 on adequate minimum wages in the EU has also sparked comments from employers’ organizations in Cyprus.
Both the Cyprus Chamber of Commerce and Industry (CCCI) and the Federation of Employers and Industrialists (OEB) welcomed the Court’s reasoning, highlighting that the decision strengthens the autonomy of member states in determining their wage policies.
It is recalled that the CJEU rejected Denmark’s appeal to annul the entire Directive but annulled two provisions that it deemed an overreach of the Union’s powers. Specifically, the Court ruled that the obligation to use specific criteria for adjusting minimum wages and the prohibition on reducing them in countries with an Automatic Indexation Mechanism (AIM) constitute an unacceptable interference in national wage-setting.
The following are the statements from the two employers’ organizations:
OEB Statement
The Decision of the Court of Justice of the European Union on the Directive for Adequate Minimum Wages and the Level of Minimum Wage as a Percentage of the National Median Wage
First: The Decision of the EU Court:
In light of the Decision of the Court of Justice of the European Union (CJEU) regarding Denmark’s appeal seeking to annul the entirety of Directive (EU) 2022/2041 on adequate minimum wages in the European Union, the Federation of Employers & Industrialists (OEB) emphasizes the following:
In its appeal, Denmark argued that the Directive violates the distribution of competences between the Union and member states, as it entails direct intervention in wage determination within the Union and in the right to associate, matters which are exclusively within the competence of member states.
The Court ruled that the Directive aimed at establishing an “adequate” minimum wage across all 27 member states is valid, but annulled two of its provisions because they “amount to (prohibited by treaties) direct intervention by EU law in wage determination” specifically as follows:
First, it removes from the Directive the criteria that member states must consider for reviewing national minimum wages, which pertain to purchasing power, cost of living, general wage levels, wage growth rates, etc.
Second, it abolishes the prohibition on reducing national minimum wages in member states that implement an automatic indexation mechanism for minimum wages. This means that it is permissible to reduce even the National Minimum Wage if it is linked to AIM and inflation is negative.
At the same time, in its Decision, the Court makes extensive references to essential issues regulated by the Directive and provides clear interpretations clarifying that:
(a) The threshold of 80% for coverage by collective bargaining is understood only as an indicator triggering member states’ obligation to develop an action plan to promote collective bargaining for wage determination. In no case is an 80% coverage rate imposed by collective agreements.
(b) The Directive does not impose greater membership numbers for workers in trade unions.
(c) The Directive does not require member states to declare collective agreements as mandatory.
(d) In numerous regulations, member states are obliged to ensure participation by social partners, with absolute respect for organizations’ autonomy and their right to negotiate and freely enter into collective agreements voluntarily.
Second: The level and adequacy of the National Minimum Wage according to EU Directive:
According to this same Directive, “member states use indicative reference values for assessing the adequacy of minimum wages, such as 60% of gross median wage and 50% of gross average wage.”
It is clarified that the Directive does not impose on member countries to set their National Minimum Wage at these percentages.
According to data from October 30, 2025 published on ETUC’s official website WAGE-UP.ETUC.ORG, a significant majority of member states have a National Minimum Wage well below 60% of their respective national median and much lower than 50% of their national average wage, taking into account any 13th or 14th salary as is the case in Greece.
As a percentage of national median wage, the level of National Minimum Wage is:
- in Estonia 42%,
- in Czech Republic 45%,
- in Latvia 46%,
- in Croatia 47%,
- in Netherlands 48%,
Source: Philenews
