Milan employment pact signed despite Cgil opposition

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In February 2000, an "employment pact" for Milan was signed, following long negotiations aimed at gaining the consent of the Cgil trade union confederation, after its refusal to sign a preliminary agreement in July 1999. These efforts proved fruitless and eventually only the Cisl and Uil confederations (along with two independent unions) signed the pact on the union side, while Cgil continued its harsh criticism, since it believes the pact is detrimental to workers' rights.

Negotiations on the establishment of an "employment pact" for the city of Milan ended on 2 February 2000 with the conclusion of a final agreement on the initiative, which has been named Milano Lavoro. As had occurred with the preliminary agreement of July 1999 (IT9908251F), there was a split on the trade union side. The agreement has been signed by the Cisl and Uil union confederations only, while Cgil refused to accept it, since it considers that the forms of work flexibility introduced by the pact clash with existing legislative and collectively agreed regulations, as well as being detrimental to workers' rights. The pact, which has been promoted by the city council of Milan, has been also signed by the representatives of the other local authorities (the province of Milan and the Lombardy region), by the territorial structures of Cisl and Uil, as well as by two independent unions (Cisal and Ugl), and, on the employers' side, by: Assolombarda, the employers' organisation for the province of Milan affiliated to Confindustria; Api Milano, the local organisation of small and medium enterprises; Cispel, the confederation of local public service firms; trade and crafts associations (Unione del Commercio, Confcommercio, Confartigianato, Claai, and Cna); and cooperative associations (Confcooperative, Lega delle Cooperative and Agci).

Through this deal, the parties intend to conduct an important experiment in social concertation at territorial level, aimed at fostering employment growth (and the reduction of irregular, clandestine work) in favour of the weaker sections of the labour force, by introducing specific forms of work flexibility to promote the employment of these groups. The main elements of the agreement are:

  1. access to the forms of flexibility defined by the agreement will be possible only for the implementation of specific and innovative projects which will be presented by the employers and then approved by a special tripartite commission;
  2. the projects implemented under the pact's provisions will involve, in particular, non-EU immigrant workers who are unemployed or underemployed, socially, psychologically or physically disadvantaged people, and workers aged over 40 who are unemployed as a consequence of company restructuring;
  3. the individual projects will be approved, verified and monitored by a special tripartite "concertation commission", made up of representatives of the city council, the province of Milan, and the social partner organisations which have signed the pact. The social partners will have joint representation on the commission. The first task of the commission will be to approve unanimously a regulation which, besides laying down procedures for its operation, will set the criteria for drawing up the projects;
  4. with a view to promote the matching of labour supply and demand for the activities developed under the pact, a "Milano Lavoro single office" will be established. It will assist firms and workers in the recruitment process, facilitate access to the funding channels which are available for the projects, provide training services and career guidance, by monitoring the skills needed for the implementation of the various projects and by designing individual training paths to meet such needs, and oversee the effectiveness of training initiatives, in terms of job placement and the stabilisation of employment;
  5. the kinds of employment contract which may be used for workers involved in the projects are fixed-term contracts, work/training contracts, traineeships, "employment grants" and "coordinated" freelance work. In particular, the possibility of recruiting people on fixed-term contracts are widened for the disadvantaged groups which have been identified as the priority beneficiaries of the employment creation projects, as well as for firms with up to five employees and people who already had "coordinated" freelance contracts with a firm; and
  6. the main stated objectives of the pact are to fight precarious employment and favour the stabilisation of the jobs created. For this reason, investments in training and the eventual transformation of fixed-term employment into indefinite duration contracts are of great importance in assessing the projects.

The agreement is experimental and has a four-year duration. However, the parties may decide on a different duration during the agreement's term.

The signatories of the agreement have declared themselves satisfied with the deal. The city council representatives affirmed that, taking into account projects which have been already presented, the creation of some 1,000 new jobs may be expected during the first implementation phases of the pact. Cgil harshly criticised the agreement, since it believes that the possibility of implementing work flexibility, notably fixed-term contracts, on the grounds of subjective criteria will introduce forms of discrimination which risk creating labour market segmentation based on different levels of employment protection. Cgil maintains, moreover, that such discrimination would contravene EU regulations, as well as Italian law and existing collective agreements. In order to resist the implementation of the pact, Cgil has threatened extensive use of industrial action, and its general secretary, Sergio Cofferati, has affirmed that the "split" between unions which took place in Milan could have important consequences at the national level. Cisl and Uil, by contrast, stressed that the agreement will improve the prospects of being recruited for people who have great difficulty in finding a job, by creating a system of permanent concertation at territorial level for employment creation and the "regularisation" of irregular employment.

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