Vaud backs constitutional min wage, rejects specific law

Context

In brief

49.1% of voters approve the constitutional initiative for a minimum wage in Vaud 47.5% reject the specific legislative proposal of 23 CHF/hour 46.8% oppose the State Council's counter-proposal

Key facts

• Cosa: Introduction of the minimum wage in the canton of Vaud
• Quando: Vote on [unspecified date]
• Dove: Canton Vaud, Switzerland
• Chi: Initiative promoted by the left and trade unions
• Importo: 23 CHF/hour (proposed value but not approved)

The canton of Vaud held a crucial vote on the minimum wage that attracted a turnout of 54.3% of electors. Although 49.1% voted in favor of the constitutional initiative to introduce a minimum wage, the concrete legislative proposal setting that wage at 23 CHF/hour was rejected by 47.5% of voters. A similar result was recorded for the State Council's counter-proposal, which was rejected with 46.8% of votes against. In Vaud's counting system, blank ballots, accounting for 5%, are included in the calculation, making the approval of the constitutional initiative valid even without surpassing the absolute 50% threshold.

Vaud's decision fits into a broader national debate on the minimum wage. Currently, only five Swiss cantons have a legal minimum wage: Neuchâtel, Jura, Geneva, Ticino, and Basel-City. Among these, Geneva applies the highest minimum wage in the world, set at 24 CHF/hour (approved in 2020).

📊 Comparison:

• Geneva: 24 CHF/hour (2020)
• Ticino: 19-20 CHF/hour (2021, in the process of gradual increase)
• Neuchâtel and Jura: 20 CHF/hour (2017)
• Basel-City: 21 CHF/hour (2022)

In Vaud's case, the approved constitutional initiative represents a first step that enshrines the right to a minimum wage in the cantonal constitution, but it does not yet have an immediate practical translation. The failed proposal of 23 CHF/hour would have guaranteed a gross monthly income of about 4,000 francs for a full-time job (42 hours per week), a value close to subsistence needs in the canton, but insufficient to fully cover the cost of living in some cities, such as Lausanne.

💡 Next steps: With the approval of the constitutional initiative, the State Council will now be called upon to draft new legislative proposals to define the amount and conditions of the minimum wage. However, the double rejection of the legislative proposal and the counter-proposal suggests an electorate split. On one side, there are those who argue that 23 CHF are too low to ensure a decent standard of living; on the other, there are those who believe a minimum wage could compromise the competitiveness of local businesses.

⚠️ Future challenges:

• Reaching a political agreement on an adequate amount
• Integrating the minimum wage with collective labor agreements
• Mitigating businesses' concerns, especially in the restaurant and retail sectors, where profit margins are often limited

This vote reflects the difficulties many Swiss cantons face in balancing social justice needs with those of the local economy, in a country where the cost of living varies significantly by region.

Operational details

Implications for the Labour Market

The outcome of the vote creates a unique situation in the Canton of Vaud: while the principle of a minimum wage was accepted in the cantonal constitution, an operational mechanism to make it effective is still lacking. This legislative void could generate uncertainty among both employers and employees, particularly for those working under individual contracts not covered by collective agreements. The sectors most exposed could include hospitality, retail, and personal services, where wages tend to be lower than the cantonal average.

💡 For example, in the Canton of Neuchâtel, the minimum wage of CHF 20/hour introduced in 2017 helped to stabilize wages in at-risk sectors, but required months of adjustment for small businesses.

📊 According to data from the Federal Statistical Office (OFS), approximately 10% of the workforce in Switzerland earns less than CHF 22/hour, a figure often considered the benchmark for a decent living wage. However, the absence of specific legislation in Vaud could slow down the reduction of this percentage.

Comparison with other cantons

Vaud becomes the sixth Swiss canton to approve a minimum wage, joining Neuchâtel, Geneva, Jura, Ticino, and Basel City. At the municipal level, Lucerne, Zurich, and Winterthur have already adopted similar measures. However, the methods of application vary significantly:

• Neuchâtel: Since 2017, a minimum wage of CHF 20/hour has been introduced, with a significant impact on low-income sectors.
• Geneva: In 2020, the minimum wage was set at CHF 23/hour, one of the highest in Switzerland, with the aim of addressing the high cost of living.
• Ticino: In 2021, the minimum was set between CHF 19 and CHF 20/hour, varying depending on the sector, offering greater flexibility.
• Basel City: Has opted for a more gradual approach, introducing a minimum of CHF 21/hour in 2022 and providing for annual revisions.

⚠️ Unlike these cantons, Vaud now faces the challenge of defining operational details for the minimum wage, such as the hourly threshold and verification tools.

Next Steps

The Council of State has expressed 'regret' over the rejection of its counter-proposal and has stated that it wants to analyze the reasons behind the rejection of the specific law. The cantonal executive will now have to elaborate a new legislative proposal that reconciles the constitutional article just approved with the practical needs of the labour market.

💡 One possibility could be to adopt an approach similar to that of Geneva, setting a minimum wage that takes into account the high housing costs in the canton.

Checklist for the Council of State:

• Definition of an hourly minimum amount based on economic and social data (e.g., CHF 22/hour).
• Analysis of the impact on key sectors such as tourism and retail.
• Creation of monitoring tools to ensure compliance with the minimum wage.
• Consultation with trade associations and unions to avoid conflicts.

⚠️ Without clear and enforceable legislation, the minimum wage risks remaining a symbolic measure rather than a real benefit for workers.

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Key points

What to do now for workers and employers

For workers in the canton of Vaud, it is essential to closely follow regulatory developments related to the introduction of the minimum wage. Although the popular initiative has led to its inclusion in the cantonal Constitution, the measure will not be immediately applicable: its implementation will depend on the enactment of specific legislation. This step requires negotiations between unions, representing workers, and employers' associations. For example, in the canton of Geneva, the minimum wage was set at 23 francs per hour (around 4,000 francs monthly for full-time work), but it took months of discussions to finalize the application details.

Affected workers should check whether their current salary might be impacted by the new regulation. Employers, on the other hand, are advised to start calculating the economic impact of potential salary adjustments, especially in sectors with a low-income workforce, such as hospitality or retail.

Useful tools

• 📊 Salary calculator: Compare your current salary with potential future standards using our salary calculator. For instance, if you earn 20 francs per hour and work 42 hours per week, a future minimum wage of 23 francs would represent a monthly increase of approximately 546 francs.
• 💡 Insights on labor rights: Visit the jobs section of our website to learn about your rights under Swiss legislation, such as maximum working hours and leave regulations.
• ⚠️ Checklist for employers:
• Assess staff costs based on a hypothetical minimum wage.
• Prepare a strategy for potential salary adjustments.
• Stay informed about upcoming legislative steps through industry associations.

Source: swissinfo.ch