"Denmark and Sweden have not succeeded in their efforts to have the EU's minimum wage directive fully annulled after a ruling by the European Court of Justice on Tuesday, but appear likely to remain unaffected by it. The two Nordic countries have fought against the EU's directive for a set minimum wage, arguing that it undermines the collective bargaining model used in both countries to regulate their labour markets."
"However, the ECJ did annul the parts of the directive which allow direct intervention to set wages in member states. The collective bargaining system used in both Denmark and Sweden involves regular negotiations between trade union and employer confederations which set wages alongside other working conditions such as working hours, holiday and pensions for the forthcoming period. Intervention by the government in the process is rare."
The European Court of Justice annulled specific provisions of the EU minimum wage directive while upholding most of it, leaving Denmark and Sweden unable to secure full annulment. The court struck down provisions permitting direct government intervention to set wages in member states. Denmark and Sweden use a collective bargaining system where trade unions and employer confederations negotiate wages and working conditions, with rare government intervention. Other EU countries without equivalent collective bargaining frameworks support a binding minimum wage directive. The court found that the directive does not have practical impact on national pay levels and that exclusions of EU competence do not bar linked questions on pay or bargaining.
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