Troika ultimatum on salary reductions in the private sector

The Troika appeared impatient for the implementation of corporate contracts and thinks that the issue of the decrease of wages in the private sector will remain open as long as they do not see in action the signing of corporate contracts with decreased wages.

During their meeting with the head of the Labour Inspectorate Mihalis Halaris, representatives of the Troika pushed to sign as many corporatecontaracts as  possible without strict controls and identified the wrong practice of the Labour minister of signing the extension of sectoral contracts.

In their meeting with Katseli in the coming day,s they are expected to ask her to encourage by any possible means the signing of contracts with wage decreases. As they stressed, they will be tolerant until the summer. If wages are not decreased they will come back asking for a modification of the law and the termination of the current restrictions.

The forming of unions is also moving forward. There have already been 600 applications. Also, the companies that have not yet closed their books for 2010, which in most cases reflect losses, will consequently call on the unions.
 
They will go to individual contracts

But even if thousands of corporate contracts are not signed due to opposition  the unions, employers are by law free to turn to individual contracts that most of the workers will be forced to sign in fear of losing their jobs.

The Troika also asked the ministry to legislate more flexibility within the framework of the 8hr timetable on a  yearly basi, meaning thatone should be able to work for 10hrs a day and get the respective time off, leave or decreased schedule during another period.

The new request presented by the auditors is that we must sign more fixed-term contracts in the private sector. And in case of dismissal we should not activate the clause in the contract, but facilitate the employer to pay half the damages, which falls outside the Civil Code.  

Mihalis Halaris answered that many fixed-term contracts in Greece are in the public sector and the GOCs. In the private sector such contracts are mainly signed in banks. Besides, they are not needed since with the new law a person can get hired under a trial period and get fired within a year without compensation.
 
Reduction up to 40% in supplementary pensions

Next week, besides the contracts, the Troika will open two more major issues pending from the memorandum, ie supplementary pensions and heavy professions. The competition for the commissioning of a consultant to conduct actuarial studies for the viability of the subsidiary has already been announced. And from February 1 until October 31 the studies must be finished. First will come the studies for IKA, the equity fund for civil servants and TEADY.

The funds that won’t be able to shoulder the burden – more than 90% – will be forced to cut off their supplementaries to20% of the main pension. And in some funds with supplementaries of 700 and 1000 euros the decrease will be at 40%, if proven that they cannot handle the demand.

The axe will fall heavily on the list of heavy professions too, since according to the memorandum the insured employees cannot exceed 10% of the working population. Those who will be excluded will have serious consequences such as the increase of age limits to 5yrs, elimination of bonuses etc. At least the Troika was satisfied with the cuts in fund expenditure that reached 2,5bil in 2010 due to the slashing of pensions and the battle against wastefulness in medicines.