Despite being approved by over 65 percent of voters back in 2023, the planned minimum wage in Zurich and Winterthur is now in jeopardy. An administrative court has ruled that the proposal in its current form breaks cantonal law and must be overturned.
In a decision released on November 29, the cantonal administrative court ruled that the planned minimum wages in Zurich and Winterthur should be scrapped. The proposals themselves were approved by 69,4 percent of voters in Zurich and 65,5 percent of voters in Winterthur in the summer of 2023.
Under the proposals, as of January 2024 anyone with a job in Zurich would earn at least 23,90 Swiss francs per hour, totalling around 4.000 francs a month for someone working full time. In Winterthur, the minimum salary was set at 23 francs per hour.
However, since the vote, the two proposals have been embroiled in legal challenges which forced authorities to delay imposing the new law. In appealing the proposals, an alliance of trade associations and businesses argued that Swiss cities and cantons do not have the legal power to enforce a minimum wage.
This view was shared by the Administrative Court of Canton Zurich, which found that the planned minimum wages in Zurich and Winterthur break the law. A majority of the court determined that the law as it stands does not allow local councils to intervene in agreements between private employers and workers in order to prevent poverty. They therefore ruled that the plans should be overturned.
The ruling was celebrated among local entrepreneurs. Speaking to the Tages-Anzeiger, Zurich Trade Association president Nicole Barandun argued that "if each [town] had its own minimum wage, that would require a lot of controls and a lot of bureaucracy” as many companies employ staff from multiple areas.
She added that collective labour agreements (CLA) remain the best way to secure higher wages: "We also want decent wages, but we are resisting further requirements and controls." This view is also shared by many in the Swiss parliament, which has in the past moved to overrule cantonal and local minimum wages in favour of CLAs.
In response, the initiative committee told the Tages-Anzeiger that the court’s decision was diametrically opposed to previous rulings. Zurich SP president Oliver Heimgartner added that the decision will continue to allow local businesses to underpay their most vulnerable workers.
For now, it remains highly likely that local authorities in both Zurich and Winterthur will appeal the decision at the Federal Supreme Court in Lausanne, which will have the final say. With many other cities and cantons planning to or having already imposed minimum wages, their decision will have nationwide ramifications.
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