Minimum Wage and Freedom of Contract: An Interdisciplinary Perspective

Interdisciplinary Approach to Law in Modern Social Context. Conference Papers, Vilnius University, Vilnius, 2016, pp. 209-217

11 Pages Posted: 27 Jul 2016 Last revised: 2 Aug 2016

See all articles by Ricardo Pazos

Ricardo Pazos

Universidade de Santiago de Compostela - Departamento de Derecho Común

Date Written: July 1, 2016

Abstract

Freedom of contract is one of the core principles of contract law. However, when it comes to employment contracts, several restrictions to this principle are legally imposed. One of them relates to the price of labour, since most of European national laws set forth a minimum wage. This paper analyses the case for implementing such a rule. The aim is to draw conclusions on whether or not a legally imposed minimum wage is justified and desirable and, if so, if its rate should be relatively high. Freedom of contract being a fundamental principle, limits on it must be necessary or, at least, beneficial for society as a whole.

The analysis is made from an interdisciplinary perspective. From a legal point of view, it is necessary to determine whether or not fixing a minimum wage is a justified restriction of freedom of contract that the legislature can set forth. In the event it were decided that the legislature is competent to limit freedom of contract on a core term such as the price of labour, it should be addressed the question of its desirability. In this paper, this is studied taking into account a historical perspective, the point of view of ethics and morals, economic grounds, and also political and sociological reasons.

Keywords: minimum wage, freedom of contract, human rights, law and economics, state policy

Suggested Citation

Pazos, Ricardo, Minimum Wage and Freedom of Contract: An Interdisciplinary Perspective (July 1, 2016). Interdisciplinary Approach to Law in Modern Social Context. Conference Papers, Vilnius University, Vilnius, 2016, pp. 209-217, Available at SSRN: https://ssrn.com/abstract=2814531

Ricardo Pazos (Contact Author)

Universidade de Santiago de Compostela - Departamento de Derecho Común ( email )

Facultad de Derecho
Avda. Dr. Ángel Echeverri
Santiago de Compostela, La Coruña 15782
Spain

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