Focus on labor reform as troika pushes tough changes

Government officials spent a second day in talks with troika representatives in Paris on Wednesday, with sources indicating that Greece’s foreign creditors were pressing for changes to make it harder for labor unions to call strike action and for the introduction of legislation facilitating mass layoffs in the private sector.

The Labor Ministry is to prepare several studies in the coming weeks, before troika envoys are due to arrive in Athens for their next review, in a bid to overcome the insistence of foreign creditors on the proposed changes, Kathimerini understands. The ministry managed to win itself some time by invoking the International Labor Organization to assess the effectiveness of potential changes to current laws governing layoffs in the private sector.

The junior coalition parter, PASOK, has insisted that it will not accept any change to laws governing labor rights that have been enshrined in Greek legislation since the 1980s. But sources have indicated that the troika is intent on removing any political involvement in decisions relating to mass layoffs and introducing greater flexibility into the private labor market. The foreign auditors argue that such action will contribute toward curbing unemployment, which continues to hover at around 27 percent.

Other issues on the table of talks between Greek officials and the troika, which continue on Thursday, are an ongoing streamlining of the civil service and the second phase of reform of the pension system.

Meanwhile Prime Minister Antonis Samaras, who is being briefed on the troika talks by advisers he dispatched to Paris, is due in Newport, South Wales, on Thursday for a summit of NATO leaders which is expected to focus on the deepening crisis in Ukraine. The premier is expected to meet with Turkish President Recep Tayyip Erdogan at the summit in what is likely to be an uncomfortable encounter following the latter’s provocative comments on Greece’s position vis-a-vis Cyprus earlier this week. Samaras is due back in Greece late on Friday ahead of his scheduled speech at the Thessaloniki International Fair on Saturday morning.