10 countries with an alternative to the minimum wage
Minimum wage is a laudable piece of legislation. It is the simplest means of raising salaries across a nation. Yet, some countries have chosen not to implement it. We look at 10 developed nations who chose not to exercise the minimum wage (as law) and learn how they protect their vulnerable workers.
Nationwide collective bargaining agreements set minimum wages by job classification for each industry and provide for a minimum wage of €1,000 per month—Wages where no such collective agreements exist, such as for domestic workers, janitorial staff, and au pairs, are regulated in pertinent law and are generally lower than those covered by collective bargaining. Denmark
Negotiated between unions and employer associations; the average minimum wage for all private and public sector collective bargaining agreements was 109 kroner ($19) per hour
Only workers in the construction workers, electrical workers, janitors, roofers, painters, and letter carriers. Otherwise minimum wage is often set by collective bargaining agreements in other sectors of the economy and enforceable by law.
The law states that paying a worker an “immoral wage” is illegal. There is no general consensus what constitutes “immoral” payment. Iceland
Minimum wages are negotiated in various collectively bargained agreements and applied automatically to all employees in those occupations, regardless of union membership; while the agreements can be either industry- or sector-wide, and in some cases firm-specific, the minimum wage levels are occupation-specific.
Instead of legislation, minimum wage is set through collective bargaining agreements on a sector-by-sector basis
This Western European country has no Government set minimum wage. Unions play a big role in negotiating a fair living wage for employees.
Wages fall within a national scale through tripartite negotiations.
The labor law provides the Emir with authority to set a minimum wage, but he did not do so.
Instead of legislation, the land of Ikea has minimum wages that are set by annual collective bargaining contracts.
No minimum wage however, a majority of the voluntary collective bargaining agreements, reached on a sector-by-sector basis, contained minimum compensation clauses, which provided for compensation ranging from 2,200 to 4,200 francs ($2,363 to $4,511) per month for unskilled workers and 2,800 to 5,300 francs ($3,010 to $5,693) per month for skilled employees
How about Singapore?
Instead of legislated minimum wage in Singapore, the unions lead a sector-by-sector implementation of a “Progressive Wage Model”. Employers in an industry are asked to pay a base minimum (eg. $1000) and integrate a career progression ladder for all staff (including low wage earners). Failure to adopt this model could result in denial of business licences.