Planned new regulation on minimum wages angers the left and cantons
Published: Friday, May 3rd 2024, 09:50
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Parliament wants provisions in collective employment contracts that have been declared generally binding to take precedence over cantonal minimum wages in future. The plan has met with fierce criticism from the left and the cantons, as the consultation shows. The Federal Council recommends that its own proposal for implementing the idea be rejected.
The background to this is a motion by Erich Ettlin, a member of the Council of States from Obwalden, which was approved by the National Council and Council of States in 2022. According to this motion, provisions of generally binding collective employment agreements (CEAs) on the minimum wage should take precedence over other cantonal provisions. This also applies if the minimum wages in a CEA are lower than the cantonal minimum wage.
Ettlin explained that the current situation was a test for the social partnership. The Federal Council already opposed it at the time - but had to make a proposal for implementation after the motion was accepted. Interested parties had until May 1 to submit their comments.
"Overriding the system of competences"
Specifically, the federal government is proposing to amend the Federal Act on the Declaration of General Applicability of Collective Employment Agreements. Provisions on minimum wages in collective employment contracts could now be declared generally binding, even if they contradict mandatory cantonal law.
However, the Federal Council has not changed its position. In its press release at the opening of the consultation, it explicitly called on Parliament not to adopt the bill. A CLA does not have the same democratic legitimacy as a cantonal law, Economics Minister Guy Parmelin had already pointed out during the parliamentary debates on Ettlin's motion.
"By implementing the petitioner's request, the federal legislator would undermine the will of the people at cantonal level, federalist principles and the constitutional order of competences," wrote the Federal Council in its statement on the motion.
Referendum is on the cards
The cantons of Geneva, Neuchâtel, Jura, Basel-Stadt and Ticino currently have cantonal minimum wages. Corresponding decisions are pending in several other cantons. In Zurich and Winterthur, voters approved urban minimum wages in 2023, but they are not yet in force.
The campaigns for cantonal minimum wages were supported by the trade unions, among others. Their criticism of the planned change in the law is correspondingly high.
"If this law really comes in the form envisaged by the National Council and Council of States, then we will call for a referendum," said the President of the Swiss Federation of Trade Unions (SGB), Pierre-Yves Maillard, SP member of the Council of States for the canton of Vaud, to the "Bieler Tagblatt" newspaper on Thursday.
The cantonal minimum wages are designed to guarantee the minimum subsistence level, the SGB emphasizes in its consultation response. The amendment to the law would mean that employees would once again receive wages below the minimum subsistence level: "In-work poverty would increase". A trained hairdresser in the canton of Geneva would lose up to CHF 500 a month if Ettlin's motion were implemented, the SGB calculates.
Circumvention of minimum wages
The trade union umbrella organization Travailsuisse warns of a dangerous precedent if industry regulations can override mandatory law and the will of the voters. Travailsuisse also emphasizes that statutory minimum wages are primarily aimed at sectors without a collective employment agreement. In sectors with generally binding collective employment agreements, the minimum wages are higher than the statutory minimum wage, with very few exceptions.
The trade unions are supported by the left. The SP is of the opinion that the Federal Council should have requested that the motion be written off on its own initiative. This is because the proposal violates the principle of legality and subsidiarity in the Federal Constitution. The Greens also emphasize that collective employment agreements are actually clearly subordinate to cantonal laws in the hierarchy of norms.
"Comprehensive intervention"
The constitutional concerns are not limited to the left. Criticism has also come from the cantons. The Conference of Cantonal Directors of Economic Affairs complains that the amendment would override popular decisions.
The Bernese cantonal government, which is predominantly conservative, writes in its statement that it is critical of minimum wages. Irrespective of this, the cantonal government considers the proposed amendment to the law to be unsuitable, as it encroaches on the cantons' competencies in social policy.
The Uri government considers the project to be disproportionate: tensions in individual collective employment contracts do not justify a comprehensive encroachment on cantonal sovereignty.
In the view of the cantonal government of Zug, the Federal Council's proposal is also not practicable: it is confusing for companies and employees if parallel and contradictory laws apply in the same place.
Commoners in favor
The Swiss Employers' Association (SAV) disagrees with the view that the planned amendment to the law is unconstitutional, as it told the Keystone-SDA news agency on request.
The employers' association argues that the federal government has comprehensive legislative powers with regard to the relationship between employers and employees. By declaring a CLA to be universally valid, it is making use of this. The cantons are then no longer allowed to issue regulations that affect the scope of application of that collective labor agreement.
"The social partners know the industries best and can therefore put together balanced solutions for industry concerns and special features in an overall package," the association adds.
The FDP also believes that it is crucial that national agreements apply to both employees and employers and cannot be undermined by regional regulations: "This creates uniform standards and fair conditions for all parties involved."
The SVP supports the implementation of Ettlin's motion in principle, but acknowledges the conflict with the competencies of the cantons in its consultation response.
Etllin's own party, the Center Party, did not take part in the consultation process. According to media spokeswoman Simone Rubin, the majority of the parliamentary group supported the proposal in the parliamentary vote.
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