Swiss Voters Decisively Reject $25 an Hour Minimum Wage
May 18, 2014 - 8:00 am
A Swiss TV network projects a decisive defeat for a ballot measure that would have established the world’s highest minimum wage at $25 an hour. The network projects a 77-23 tally when all the votes are counted.
The measure was backed by unions, the Greens, and the socialists. Business and the government opposed the wage, warning it could make living in Switzerland even more expensive than it is now, and would hurt the very people it was aimed at helping due to a loss of low-skill jobs.
Under the plan, employers would have had to pay workers a minimum 22 Swiss francs (about $25; £15; 18 euros) an hour.
Supporters said the move was necessary for people to live a decent life.
But critics argued that it would raise production costs and increase unemployment.
Almost 77% of voters opposed the minimum wage proposal, according to almost complete results. Supporters had argued it would “protect equitable pay” but the Swiss Business Federation said it would harm low-paid workers in particular.
The issue was the most prominent of several referendums held on Sunday.
Unions argued that the measure was necessary because of the high living costs in big Swiss cities such as Geneva and Zurich.
The unions are angry that Switzerland – one of the richest countries in the world – does not have a minimum pay level while neighbouring France and Germany do.
They argue that surviving on less than 4,000 francs a month is not possible because rents, health insurance and food are all prohibitively expensive.
The minimum wage in Germany will be 8.5 euros an hour from 2017.
A key element of the campaign in favour of a minimum wage was the argument that the Swiss welfare system was being forced to subsidise businesses which refuse to pay a living wage.
But business leaders and the government said low unemployment and high standards of living for the majority showed there was no need for change.
Small businesses, in particular Swiss farmers, were especially worried that being forced to pay their staff 4,000 francs a month would price their products out of the market.
Most of Switzerland’s low-paid workers operate in the service industry, in hotels and restaurants, and the majority of them are women.
This is not a turn to the right for Switzerland — just likea referendum earlier this year on limiting immigration from the EU was not a sign of xenophobia. The Swiss are a very practical, pragmatic people and detest extremes. By any measure, the $25 an hour minimum wage was a radical proposal and deserved to go down to defeat.
Voters also defeated a ballot measure last year that would have limited executive pay to 12 times the amount made by the lowest paid worker in a company. That measure was also overwhelmingly rejected 65-35.
The Swiss apparently see limits to their experiment in democratic socialism and, while concerned about the income inequality question, won’t overturn their society to address it.