If you are an American seeking to do business in Europe, or vice versa, it is useful to have an overview of the cultural and legal differences between the two continents to understand how these impact the respective work cultures. As each state in the U.S. and each country in Europe has its own quirks, it would be impossible to cover all variables. This series is intended to give a basic overview of some common and general points to bear in mind.
So over the next few months, we’ll be addressing quickly the most common questions we entertain. We’re also hoping to start a conversation – if there’s a topic you’d like us to cover, please let us know.
PART 1
Minimum Wage
Europe. There is no Europe-wide minimum wage law. For example, Italy, Austria, Sweden, Denmark, Finland and Cyprus do not have a minimum wage. Germany did not have a minimum wage until introducing it in 2015, relying before then on collective bargaining agreements and unions to protect workers. England has a staggered minimum wage that increases with the age of the worker. France has a monthly minimum wage. The take-away is that each country is different, not only in whether a minimum wage exists, but also the level of the minimum wage and the role that unions play in the employment landscape.
United States. In the U.S., federal law sets the mandatory minimum wage, which can be trumped by higher rates set by individual states and local city laws. So the minimum wage applicable to your employees depends on the state and city in which the employee is working. (There are some categories of workers who are not protected by minimum wage laws, but the general point is that most employees will be protected by some form of minimum wage law wherever in the U.S. he or she works.)
Look out for our next blog on differences in approach between the U.S. and Europe on severance payments. For Part 2, click here.
Manori de Silva is an employment and business attorney who has worked in Europe and the U.S.