Minimum wages should be set by member states and not centrally controlled by the European Union, minister Carmelo Abela told EU peers during a videoconferencing meeting this week.

Abela said that while ensuring adequate minimum wages was important, governments had to be able to have the necessary leeway to set them according to their national realities.

The minister within the Office of the Prime Minister was speaking during an informal videoconference of Employment and Social Affairs Ministers in the European Union, hosted by the Party of European Socialists. 

The European Commission in October proposed an EU directive that would set a framework for minimum wages across all EU member states and encourage collective bargaining, which evidence shows tends to lead to higher minimum wages.

All EU member states have minimum wage legislation. In six countries, minimum wages are protected exclusively through collective bargaining mechanisms.

When unveiling its proposal, the Commission emphasised that it would not oblige Member States to introduce statutory minimum wages and would not set any common minimum wage level.

Abela said the Commission’s efforts should be commended but that Malta’s position was that minimum wages should be nationally regulated and based on labour market specificities within that country. 

He acknowledged that the proposed directive would bring member states closer to introducing mandatory mechanisms that lead to more dynamic minimum wages, but expressed concern that the directive would leave countries that undergo an economic shock exposed.