Observation (CEACR) - adopted 1993, published 80th ILC session (1993)

Minimum Wage Fixing Convention, 1970 (No. 131) - Netherlands (Ratification: 1973)

The Committee notes the information supplied by the Government in its report, in particular, the Act of 14 November 1991, introducing a change in the system of fixing minimum wage (1991, No. 624).

The Committee recalls that it requested in the previous comments, in connection with the comments made by the Federation of Christian Trade Unions (CNV), the Government to indicate the extent to which and the manner in which account had been taken of the factors mentioned in Article 3(a) of the Convention.

The Government indicates in the report that after the freeze in 1988 and 1989, the minimum wages were increased in 1990 and 1991 as much as wages in the market sector. It also states that under the above Act a new system was introduced as of 1 January 1992, under which the actual raise of the minimum wage is based on the estimated average wage increase in the market sector and the government sector in the year in question (section 14(1) and (2) of the Minimum Wage and Minimum Leave Allowance Act, No. 657 of 1968, as amended by the above Act). The new Act, however, provides the possibility for the Government of not executing the automatic link under two conditions: the average wage rise being considered too high; and the growth of social welfare benefits resulting in the tax increase (section 14(5)). In such a case, the Government must first consult the Social and Economic Council (section 14(8)). The Government considers that the above two conditions are brought together in the ratio between the number of people receiving a social benefit ("i") and the number of people with a labour income ("a") that is called the i/a ratio, which has recently been 86 per cent. It further states that if the i/a ratio exceeds this 86 per cent, the automatic adjustment of the minimum wage can be cancelled.

The Committee notes these indications. Noting that the concept of the i/a ratio is not provided in the above-mentioned new Act, it requests the Government to indicate whether the employers' and workers' organizations were consulted in introducing this concept, and to supply any legislative or other texts that provide for the use of the i/a ratio in determining the application of section 14(5) mentioned above. The Committee also requests the Government to continue supplying information on the actual adjustment of the minimum wage under the new system.