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ISSUE 67 page 2

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Spanish labour reform: bad jobs drive out good

 MANY EU MEMBER STATES HAVE TINKERED with their labour laws under pressure from the economic crisis, usually in the direction of deregulation with the intention of making it easier to sack workers. The belief of the authorities was that this would stimulate companies to employ more people. In the case of Greece the government was under orders from the ‘troika’ officials of the IMF-ECB-EU axis while Germany loosened its legislation ‘voluntarily’ some time before the onset of the slump. Spain represents a middle way as, although its banks  received EU funds, there was no general ‘bail-out’ which imposed external demands for reform. Nonetheless, in 2012, the centre-right government took the opportunity to reduce and cap redundancy payments as well as making collective redundancies easier, allow employers to impose extra hours on part-time workers, to keep interns for three years instead of one and to sack workers on sickness absence. This was allied to measures intended to make more collective agreements at the company level and to enable small firms to back out of deals if economic conditions change. Now, two years later, it is possible to assess the effect of these reforms. 800,000 full-time jobs have been lost and 150,000 part-time ones created.
What seems to be happening is that employers are cutting up full-time jobs to make two or more



part-time ones. This is not surprising as part-timers are, on average, paid €10.82 per hour compared to €16.20  for full-time. The government sees this as enabling workers to achieve a better work-life balance but statistics show that 60% of women and 70% of men say that they only work part-time because they cannot find a full-time job. Another aim of the reformers was to decrease the use of temporary contracts which Spanish employers have tended to offer instead of the usual open-ended contracts. However over 90% of new jobs are offered on a fixed-term basis, about the same figure as before the deregulation. One measure that has changed is the number of internships, up by 40% in a year (see chart below). These young workers are paid only €200 a month.
Of course Spain is still in a prolonged depression and the main feature of the labour market that an outside observer might point to is the  continued loss of jobs of whatever sort. Yet similar reforms that were undertaken much earlier in the buoyant economy of Germany seem to have had identical results with an increased number of mini jobs, part time jobs, and temporary contracts. It is hard to believe that a job-rich recovery can be sustained through this precarious employment.

This article is largely based on a post by Ronald Jansen to the Social Europe blog



Posted Workers enforcement measure could make things worse say unions
THE NEW DIRECTIVE DESIGNED TO TIGHTEN UP the 1996 law on posted workers, which was passed by the last European Parliament just before it broke up, has not met with the approval of Europe’s trade unions.  Amendments from the Socialist and Democrats (S&D) and United European Left (GUE) groups were voted down as the parliament attempted to complete it before the end of its term. Although the Enforcement directive brings in a number of new requirements for employers designed to prevent abuse of workers transferred from their home country, the ETUC warned that ‘At worst it undermines the ability of those member states who do try to enforce this Directive to do so in future’. One example of this, says General Secretary Bernadette Ségol, pertains to the practice of sub-contracting. At present eight Member States hold all companies in such a chain responsible for breaches of contract like non-payment of wages but the new directive requires such laws to be ‘proportionate’ which could lead to the European Commission weakening their effect. Nonetheless the directive gained approval from MEPs such as Pervenche Bérès (S & D) who pointed to new obligations on employers to publicise the rights of posted workers and on the national authorities to keep each other informed about problems such as ‘letter-box’ companies set up to take advantage of lower social security payments in specific countries.  Other provisions include the designation of a contact person to give information on the numbers, identities and start and finish dates of the posted workers, the obligation to keep basic documents e.g. payslips and employment contracts and the ability of workers to complain and/or prosecute erring employers. The text also defines what a genuine posting is as opposed to bogus self-employment used by some rogue employers to avoid paying any social contributions.  The European Commissioner for employment and social affairs, Laszlo Andor said: ‘The European Parliament has recognised the political importance of putting in place new tools to safeguard posted workers' rights …  Europe's labour market should be about creating more and better jobs, and not about a race to the bottom’ but Ms, Ségol blamed Commission President Barroso for failing ‘to do what he promised... It is deeply frustrating and disappointing. A strengthening of the Directive itself is now more urgent than ever’. The Enforcement directive was approved by the Council of Ministers in May and Member States now have 2 years to implement it.

Bargaining round-up

PORTUGAL WAS ONE OF THE ‘BAIL-OUT’ COUNTRIES whose banks received loans from the EU-IMF-ECB ‘troika’ at the expense of swingeing cuts in the public sector, including to pay and conditions of workers. One of the most hated of government reforms was the imposition of a 40-hour week by the government, increasing working time in public posts by five hours with no extra pay, an effective salary reduction of 14.3%. Opposition MPs challenged the new law in the constitutional court on the grounds that it did not allow for negotiation of hours by collective agreement. Although the court upheld the law it also allowed trade unions to conclude deals on hours in future. Using this ruling, by February, unions had negotiated with 145 local authorities to return to the 35-hour week.  The government, which still refuses to engage with unions on a national basis, has stalled the approval of these deals by referring the question of whether it can interfere with them to the Attorney General’s office.
IN ESTONIA THE MINIMUM WAGE HAS HOVERED around the 30% mark as a proportion of the average salary, much lower than the EU’s recommended 60% of the national average monthly wage.  Between 2008 and 2011, in the depth of the economic slump, the employers’ confederation ETTK refused to negotiate any rise with the Estonian TUC, EAKL. However, following the election of new leaders for both organisations last year, a two-year agreement was signed that will see increases of 10.9% in 2014 and 9.9% in 2015 bringing the monthly minimum up to €390. This represents 35.7% of the average wage, the highest it has ever been.
TURKISH UNIONS HAVE NOT BEEN SHY OF taking on multi-national companies, often over basic recognition rights. UPS (see issue 56) eventually conceded after a long campaign and now, fellow logistics company DHL have also been persuaded. The German-based courier firm had previously dismissed TÜMTIS union members for holding a recruitment drive but, after concerted action by DHL workers in Germany and New Zealand, permanent employees, joined by 750 former sub-contractors, won social security payments and pay rises of between 36% and 42%. Worldwide action was sustained by the International Transport Federation who picketed German embassies and protested outside London Fashion Week which is sponsored by DHL. Kenan Ozturk of TÜMTIS thanked ‘all our union friends worldwide for their support and solidarity, their visits to the picket line and their worldwide mobilisation’.Video from the London Fashion Week protest is available at:

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