New EU minimum wage law will not substantially alter trade union engagement, conference hears

Employers are unlikely to see significant change in how they are expected to engage with trade unions as a result of the EU Directive on Adequate Minimum Wages, an Ibec conference has been told.
However, many may have to engage more with their workers because of other legislative changes in the pipeline, they were told.
Irish trade unions have argued that legislative change is needed to facilitate higher levels of collective bargaining in order to comply with the directive, due to be transposed by November 15th.
Greater coverage – the number of people whose minimum terms are governed by collective agreements even if they are not a member of a trade union – has been identified in the directive as a mechanism for promotion of improved wages for the low paid.
Member states with less than 80 per cent coverage are obliged to draw up an action plan to promote it.
In Ireland, coverage is put at about 40 per cent with density, or union membership, slightly lower at 35 per cent generally and less than 20 per cent in the private sector.
The Department of Enterprise and Employment said its legal advice is that no legislation is required as part of the transposition and none is planned, a decision in line with Ibec’s own long-standing position.
Addressing the organisation’s Leadership Summit conference on Wednesday, executive director Maeve McElwee said any transformation of collective bargaining would be “a huge ask”.
“The challenge for us is that we don’t really have a big tradition of collective bargaining in recent decades,” she said. “We do have really professional HR services and direct engagement models that are already created. We have lots of individual employment rights. And lots of employers kind of stand back and [say]: ‘Where are we going to negotiate on this? What are we promoting here?’
“People don’t necessarily seem to be flocking in droves towards trade union membership. We see it falling back in every member state.”
She said she does not expect any “significant sea change” with regard to engagement with trade unions and suggested it was not as pressing an employer issue as EU legislation tends to be implemented more fully in Ireland than in other members states where a greater portion of any change envisaged would be left to local engagement.
Tom Hayes, a former trade union official and current executive director of the Brussels European Employee Relations Group which advises employers including multinationals, said he did not anticipate the directive having any impact on union density even if collective bargaining coverage was substantially increased.
In France, he said, union membership in the private sector is 5 per cent but coverage is 98 per cent.
“If you have collective bargaining coverage, why would you join the union?” he said. “Why would you pay the subscription if you’re going to get the deal anyway? That is what happens in France and Spain and so on.”
Prof Michael Doherty of Maynooth University said if this directive does not result in increased union membership, employers are going to be engaging with their workers.
“The challenge for HR, I think, is going to be how to introduce some sort of collective representation in an enterprise or sector without trade unions,” he said. “That’s not easy, but I think it will be necessary, both because I think there is a genuine desire for it and because there is a push coming from a number of EU directives on issues like pay transparency, AI, platform workers etc.
“You will have to inform and consult with your employees’ representatives and so you will have to find employee representatives.”