Labor deal row brewing over contracts
Greece?s lenders have asked the government to renegotiate the national collective contract, which sets the minimum wage, or to take the necessary legislative steps to scrap it so employers can negotiate salaries with employees on an individual basis.
The request was made during Monday?s meeting between Labor Minister Giorgos Koutroumanis and the representatives of the European Commission, the European Central Bank and the International Monetary Fund, collectively known as the troika. Prime Minister George Papandreou appears to have reacted angrily to the suggestion that the minimum wage and the labor rights guaranteed by the collective contract should be scrapped.
?Collective labor contracts apply,? he is reported to have told a group of PASOK MPs from central Macedonia during a private meeting. ?We are not, nor do we have any intention of becoming, India or Bangladesh.?
According to sources, the government was urged to hold talks with labor unions to discuss renegotiating the collective contract with the aim of reducing salaries. But the troika apparently asked that if a deal is not possible then the government should move to change the law to allow the minimum wage, currently set at about 750 euros gross or 570 euros net, to be reduced.
Sources said the troika asked that collective contracts which apply to specific sectors of the economy should not be renewed for the next three years. Last year, after pressure from its lenders, the government passed a law allowing employers to bypass the contracts and ask their employees to accept lower wages.
There was no official reaction to the troika?s demands but sources said that Koutroumanis pointed out that if wages are reduced, social security contributions and consumption would also suffer.
The EC, ECB and IMF representatives also met with New Democracy leader Antonis Samaras and his aides on Monday after the conservatives requested a chance to present their ideas for reducing public sector costs. ND is opposed to the scheme that will lead to some 30,000 civil servants being placed on standby with a view to losing their jobs. It argues that costs can be cut without any job losses.
The troika, however, appeared unimpressed by ND?s plans. Sources said the conservatives would use this to show voters that it is taking a different stance from the government.
