Nearly three years after Denmark challenged the EU Directive on Adequate Minimum Wages (AMWD), last November 11th, 2025, the Court of Justice of the European Union (CJEU) has issued a landmark judgment clarifying the boundaries of EU legislative power in wage policy.
The ruling struck down selected provisions of the directive but preserved the EU’s ability to shape wage setting procedures and promote collective bargaining.
The AMWD is politically rooted in the European Pillar of Social Rights (EPSR), a 2017 interinstitutional declaration by which the three EU legislative institutions (Commission, Parliament, and Council) have set 20 “principles and rights essential for fair and well-functioning labor markets and welfare systems in 21st century Europe” (EPSR; Preamble No. 14). The goal was to achieve upward social convergence across the European continent.
Although lacking binding force, the EPSR has been a decisive agenda-setter in EU social policy since 2019. Drawing from Article 4 of the Revised European Social Charter, Principle No. 6 EPSR affirms that minimum wages must help workers secure a decent standard of living, meet the needs of workers and their families, and be set transparently and predictably.
Enhancing the adequacy and effectiveness of minimum wages and safeguarding collective autonomy (i.e., the autonomy of social partners) thus constitutes a twofold objective of EU’s action in the social field, which the AMWD aims to embody with its Article 5 on adequacy...
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