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EUROPEAN REVIEW

ISSUE 28 - Page 3

Germans protest at Schröder cuts

WE HAVE PREVIOUSLY EXAMINED the move towards cuts in social benefits and taxes which the German government has made in an effort to revive their flagging economy (see Issue 24) but now as the policy is put into practice large scale protests have broken out in the country. Thousands of demonstrators took to the streets on Mondays throughout the summer, particularly in the eastern half of the country that is hit hardest by unemployment. Protest has crystallised around the 'Hartz IV' law which was drafted by Volkswagen executive Peter Hartz with the aim of reducing payments to people in long term unemployment. The current unemployment assistance, a bridge between unemployment benefit, which is financed by social insurance, and social welfare

German protestor

assistance, which comes from general taxation, will be abolished. As the latter is means tested while the former is related to previous earnings, about 2.2 million people are likely to see their benefit cut. Not only spouse's income but other assets such as private pension provision will now be part of the test. On top of this the new law will require unemployed people to take specially created jobs which will pay only €1 or €2 per hour above their new benefit rate. Chancellor Gerhard Schröder has refused to water down the new legislation: 'Showing sensitivity and trying to relieve people's fears does not mean changing, it means explaining why what we are doing is necessary' he said in an interview. However following poor poll results in regional elections the government ruled out more reforms before the 2006 federal election.

A German protester

Working Time struggle goes on and on

IN OUR LAST ISSUE we set out the options that the EU was considering in amending and updating its Working Time Directive. Now the Commission has put forward its own proposals and it seems that nobody is satisfied with them. Under the plans the individual opt-out would be kept but there would be greater safeguards against its misuse. Where there is a recognised trade union opt-outs would be negotiated collectively; employers cannot make employees sign as they join the company and any individual signing an opt-out would have to renew it every 12 months.

The reference period, the period over which working time must average less than 48 hours per week, can be extended from 4 months to a year under the proposals. Also no employee would be able to work more than 65 hours in any one week. Finally the Commission proposes that on-call time, in occupations such as medicine and the police, should not constitute working time in order to deal with complications arising from the SIMAP and Jaeger court cases (see European Review issues 13 and 25). However compensatory rest must be allowed within 72 hours of the on-call period. Reaction to the proposals was swift and almost unanimously hostile, though from different viewpoints. The ETUC's John Monks declared: 'I am very disappointed in the Commission. It has largely caved in to pressure from certain Member States and employers'

Dimas, S.

lobbies on key issues like making the individual opt-out more widely available, giving employers a unilateral right to organise working time over 12 months, and practically ending protection for on-call workers'. While UNICE said that the plan fell short of their requirements, CBI Director General Digby Jones went further 'It ... will effectively undermine the right of employees to make a personal choice as well as placing an administrative straitjacket on companies using the opt-out'. The UK government seems to have sided with the employers with reports that it will oppose the proposals. Meanwhile the Socialist group in the European Parliament threatened legal action against the Commission on the basis that it has not respected its treaty obligations to improve the working environment and protect workers' health and safety. Employment and Social Affairs Commissioner Stavros Dimas seems

Stavros Dimas, the Employment Commissioner trying to please all sides

to have his work cut out to persuade any concerned party that 'It is a balanced package of measures that protect the health and safety of workers whilst introducing greater flexibility and preserving competitiveness'.

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WE HAVE PREVIOUSLY EXAMINED the move towards cuts in social benefits and taxes which the German government has made in an effort to revive their flagging economy (see Issue 24) but now as the policy is put into practice large scale protests have broken out in the country. Thousands of demonstrators took to the streets on Mondays throughout the summer, particularly in the eastern half of the country that is hit hardest by unemployment. Protest has crystallised around the 'Hartz IV' law which was drafted by Volkswagen executive Peter Hartz with the aim of reducing payments to people in long term unemployment. The current unemployment assistance, a bridge between unemployment benefit, which is financed by social insurance, and social welfare		assistance, which comes from general taxation, will be abolished. As the latter is means tested while the former is related to previous earnings, about 2.2 million people are likely to see their benefit cut. Not only spouse's income but other assets such as private pension provision will now be part of the test. On top of this the new law will require unemployed people to take specially created jobs which will pay only €1 or €2 per hour above their new benefit rate. Chancellor Gerhard Schröder has refused to water down the new legislation: 'Showing sensitivity and trying to relieve people's fears does not mean changing, it means explaining why what we are doing is necessary' he said in an interview. However following poor poll results in regional elections the government ruled out more reforms before the 2006 federal election.
	A German protester

The reference period, the period over which working time must average less than 48 hours per week, can be extended from 4 months to a year under the proposals. Also no employee would be able to work more than 65 hours in any one week. Finally the Commission proposes that on-call time, in occupations such as medicine and the police, should not constitute working time in order to deal with complications arising from the SIMAP and Jaeger court cases (see European Review issues 13 and 25). However compensatory rest must be allowed within 72 hours of the on-call period. Reaction to the proposals was swift and almost unanimously hostile, though from different viewpoints. The ETUC's John Monks declared: 'I am very disappointed in the Commission. It has largely caved in to pressure from certain Member States and employers'		lobbies on key issues like making the individual opt-out more widely available, giving employers a unilateral right to organise working time over 12 months, and practically ending protection for on-call workers'. While UNICE said that the plan fell short of their requirements, CBI Director General Digby Jones went further 'It ... will effectively undermine the right of employees to make a personal choice as well as placing an administrative straitjacket on companies using the opt-out'. The UK government seems to have sided with the employers with reports that it will oppose the proposals. Meanwhile the Socialist group in the European Parliament threatened legal action against the Commission on the basis that it has not respected its treaty obligations to improve the working environment and protect workers' health and safety. Employment and Social Affairs Commissioner Stavros Dimas seems
	Stavros Dimas, the Employment Commissioner trying to please all sides