Dr. Paul Redmond:

With regard to the EU directive, there is no getting around the fact that Ireland is obliged to transpose that into law this year. The directive is not prescriptive. It does not exactly say this is what the minimum wage should be, but it sets a framework for establishing minimum wage adequacy that is consistent across Europe. In doing so, it provides guidelines that would say that a minimum wage needs to be set on grounds that can be justified as fair.

Generally speaking, what we are talking about is the minimum wage being set as a percentage of, say, the median or average wage. The common standard or benchmark for setting it would be at 60% of median wage. That is expressly stated in the EU directive but it falls short of saying this needs to be done.

The other thing in the EU directive that is relevant to today's discussion is that, again, while not saying that sub-minimum youth rates should be outlawed, it certainly cautions against their use. When this is looked at in light of the recent findings from the European Social Charter, there is no getting around the fact that Ireland is now obliged to deal with these issues. In dealing with them, it seems that sub-minimum wage policy needs to be reformed. In that regard, the recent recommendations from the Low Pay Commission are consistent with those directives and guidelines.

It is also worth noting that this is not unique to Ireland. This is affecting all EU countries. Other EU countries are in the same boat and are making similar arrangements to Ireland to try to benchmark the minimum wage in a clear and transparent way. This is happening across Europe.