Luxembourg - Minimum wage profile

Increases in national minimum wages can have various knock-on effects – they can, for instance, lead to wage rises more generally and can influence the social partners’ latitude in collective bargaining. This report examines how changes to national minimum wages affect collectively agreed and actual wages in selected low-paid jobs and sectors. A quantitative analysis uses the Eurofound database on minimum wages for low-paid workers in collective agreements to analyse the impact of national minimum wages on collectively agreed minimum wages. Data from European Union Statistics on Income and Living Conditions are used to analyse the impact of national minimum wages on actual wages.

A qualitative analysis is based on national case studies of the residential and social care and the manufacture of food and beverages sectors in six Member States: France, Germany, Portugal, Romania, Slovenia and Spain. These Member States were selected because they differ in terms of the interaction between national minimum wages and collectively agreed wages. The analysis finds that, generally, there is a positive association between national minimum wage uprates and changes to both actual and negotiated wages in low-paid sectors, although there are differences among the countries.