The canton of Geneva has Switzerland’s highest minimum wage, but a vote in the Swiss parliament could pave the way for it to be scrapped altogether.
Switzerland’s National Council has voted in favour of collective labour agreements taking precedence over cantonal minimum wages that were brought in by popular vote.
That means that the minimum wages in the cantons of Geneva and Neuchâtel could eventually be scrapped if the move is backed by Switzerland’s Council of States.
Even though its salaries are among the highest in the world, Switzerland is one of only five nations in Europe — the others being Sweden, Denmark, Iceland, and Norway — that has never introduced minimum wages nationally.
A national vote in favour of a minimum wage failed to pass in 2014 but that has not prevented individual cantons from introducing their own minimum salaries.
Geneva has the country’s highest minimum wage at €25 an hour and the canton of Neuchâtel has a minimum hourly wage of €21. Both were brought in after popular votes in the cantons.
One of the reasons why Switzerland doesn’t have more cantons with minimum wages is that the Swiss believe that fair and equitable pay is already guaranteed by collective bargaining agreements (CLA), contracts that are negotiated between Switzerland’s trade unions and employers.
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They cover a minimum wage for each type of work, in addition to regulations relating to work hours; pensions; payment of wages in the event of illness or maternity; vacation and days off; and protection against dismissal.
CLAs are sector-specific; in other words, they take into account the particular aspects of each branch.
But there has been a push in recent years among some legislators to scrap cantonal minimum wages altogether in favour of CLAs and the vote in the Swiss parliament this week looks like a crucial step along the way to that happening.
However there are two key hurdles to overcome before the reform to favour CLAs over cantonal minimum wages can become a reality.
The text still has to pass the Council of States in the Swiss parliament. Then it’s likely that the move will be put to a popular vote.
Swiss trade unions were left angry at the vote, claiming it will make cantonal referendums worthless.
“For the first time in history, wage reductions are planned through a federal law,” said the Swiss Trade Union Federation.
“If the Council of States adopts the bill, democratically taken popular decisions would be rendered meaningless.”
But the move has won support among business groups.
The Federation of French-speaking businesses said: “Today’s vote is good news. This decision promotes social partnership, which is a key element in the success of the Swiss economic and social model.”
