Employees enjoy right to a universal minimum wage

Quick info
Data type	Numeric
Scale	Metric
Value labels	Not applicable in the strict sense since the scale is quasi-metric, but for coding the following values were used for orientation: up to 1 = a universal minimum wage is legally foreseen. up to 0,67 = the law foresees differential minimum wages regulated by sector or profession without a universal wage floor. up to 0,33 = the law provides for the possibility to introduce minimum wages by sector, profession, region or otherwise on an occasional basis. 0 = otherwise. Scope for further gradations between 0 and 1 to reflect changes in the strength of the statutory law.
Technical name	labor_minwage
Category	Labour and labour market
Label	Employees enjoy right to a universal minimum wage
Related indicators	Law provides for equal access to employment for men and women Law provides for equal working conditions for men and women Law prescribes special measures for women Law provides for equal access to employment concerning ethnicity/race Law provides for equal working conditions concerning ethnicity/race Law provides regulation of special measures concerning ethnicity/race Equal pay for work of equal value is legally provided for

This WoL indicator measures whether and to what extent a statutory minimum wage is provided for. It does not measure the level of the minimum wage or the age gradation.

In an employment relationship, the employee transfers the power of disposition over their productive labour to their employer for a fixed period of time in exchange for a wage. The amount of the wage is generally determined by the contractual parties.

However, there is an elementary contradiction of interests in the wage negotiation: for the employer, wages are costs that they want to keep as low as possible. For employees, on the other hand, the level of pay determines the extent of their opportunities for reproduction and social participation – so they have an interest in the highest possible pay. Without legal/collective regulation, this contradiction is resolved in favour of the employers by competing among employees: the pay that has to be paid is the lowest amount for which an employee can be found.

In this race to the bottom, there are periods of increased unemployment and underemployment, in particular, when wage levels are not even high enough to fully cover basic reproduction costs (housing, nutrition, clothing, health) or to enable a minimum standard of living. Politically undesirable consequences such as the endangerment of public health due to malnutrition, the increase in crime and homelessness – or, where applicable, the burden on the social system – can be limited or combated by the state through the introduction of a minimum wage.

By setting minimum wages or sanctioning autonomous minimum wage instruments, the state sets a lower minimum level of pay. This sets a minimum level of economic equality in the sense of equalising, in order to limit the competition of underbidding anchored in the logic of the market.

Coding rules

The WoL is a leximetric dataset on individual employment protection. It quantifies the strength of the standard-setting, privileging, and equalising function of individual labour law (see Dingeldey et al. 2022). The scale ranges from "0" to "1" where "0" corresponds to the absence of any legal regulation of minimum wages, values up to "0,33" correspond to the legal possibility to introduce sectoral minimum wages, up to "0,67" corresponds to the prescription of sectoral minimum wages without a universal minimum wage, and "1" corresponds to the legal regulation of a universal minimum wage. Coding instructions and description of indicators are laid down in a technical paper (Fechner/Carlino, forthcoming). For country-specific information see WoL documentation (forthcoming).

Bibliographic info

Citation: Irene Dingeldey, Heiner Fechner, Jean-Yves Gerlitz, Jenny Hahs, Ulrich Mückenberger, Worlds of Labour: Introducing the Standard-Setting, Privileging and Equalising Typology as a Measure of Legal Segmentation in Labour Law, Industrial Law Journal, Volume 51, Issue 3, September 2022, Pages 560–597, https://doi.org/10.1093/indlaw/dwab016

Related publications:

• Mückenberger, Ulrich, 1985. "Die Krise des Normalarbeitsverhältnisses - Hat das Arbeitsrecht noch Zukunft?" Zeitschrift für Sozialreform 31: 415-434; 457-475
• Mückenberger, Ulrich, and Simon Deakin. 1989. "From Deregulation to a European Floor of Rights: Labour Law, Flexibilisation and the European Single Market." Zeitschrift Für Ausländisches Und Internationales Arbeits- Und Sozialrecht 3: 153–207.
• Carlino, M., Fechner, H., & Schäfer, A. (2024). Using leximetrics for coding legal segmentation in employment law: The development and potential of the Worlds of Labour database. In I. Dingeldey, H. Fechner, & U. Mückenberger (Eds.), Constructing Worlds of Labour. Coverage and Generosity of Labour Law as Outcomes of Regulatory Social Policy. Palgrave Macmillan.

Misc

Project manager(s):
Responsible for data coding: Heiner Fechner (2018-2025)
Responsible for data editing and entry: Heiner Fechner (2024-2025), Andrea Schäfer (2021-2025), Jean-Yves Gerlitz (2018-2020)
Principal Investigators: Irene Dingeldey, Ulrich Mückenberger
Student assistants (2018-2025): Julia Bode, Jessica Bonn, Daniel Euler, Maxime Fischer, Jan-Christopher Floren, Jennifer Götte, Désirée Hoppe, Irina Kyburz, Alexandra Kojnow, Tarek Mahmalat, Karolin Meyer, Johanna Nold, Tanusha Pali, Johannes Ramsauer, Max Sudhoff, Kristina Walter, Caroline Zambiasi.

Data release:

• Version 0.001: Initial release

Revisions: The template has been revised in 2024, but coding for the completion of the revised dataset is still ongoing; values in WeSIS Version 0.001 correspond to the original template. The revision concerns primarily wording (no fundamental change in content), and furthermore the introduction of finer differentiations.

Sources

Own coding.