Greece: Latest working life developments – Q3 2017
The new law to regulate industrial relations issues, SEV's ideas on collective bargaining, union proposals for labour protection, and a draft law to combat undeclared work are the main topics of interest in this article. This country update reports on the latest developments in working life in Greece in the third quarter of 2017.
Labour law passed
Law 4488/2017, tabled by the Ministry of Labour and passed on 13 September 2017, was an attempt by the government to regulate industrial relations issues without compromising commitments to reform the legislative framework on industrial relations, which had been made by the country when it was admitted to the European Financial Stability Mechanism (EFSM).
The law provides for a series of regulations including:
- obliging employers to declare overtime to the authorities;
- shortening the time for hearing labour cases;
- reducing the cost of proceedings for labour cases.
Social insurance arrangements are also covered. However, the General Director of the Hellenic Federation of Enterprises (SEV) stated that the Law comprises a series of technical and rather minor regulations on undeclared work, social insurance arrangements and the extension of rights to specific groups of the population.
The Hellenic Confederation of Commerce and Entrepreneurship (ESEE) takes a more positive view, commenting in a memo that the law contains social provisions with additional benefits for the employed, the self-employed, farmers and young scientists, as well as domestic interventions for additional, even stricter, measures for uninsured work and unpaid arrears.
SEV issues ideas on collective bargaining
In its weekly bulletin published on 7 September 2017, SEV presented OECD data on collective industrial relations systems in OECD Member States.
The introduction emphasises that Greece’s social partners must find a new way of amicably arranging industrial relations so that there is no recurrence of the deadlocks that previously characterised working practices, and which also contributed to the economic crisis of the last 10 years.
According to the bulletin, the collective bargaining system that applied in Greece before the crisis ignored the necessary interconnection of long-term wage developments and productivity development, and the competitiveness of the sectors of internationally traded goods and services. The way in which wages were set had a significant negative impact on wage flexibility at company level, and therefore on competitiveness, investments and employment in the Greek economy.
It stresses that the potential return of the labour regulations that applied before the crisis would make it more difficult to achieve international competitiveness and would deter foreign investment, with adverse consequences for the future of the economy. The bulletin also noted that discussions between the social partners and the political parties should focus on social insurance, ‘which chips away at the disposable income of employees, overburdening the world of work with unacceptably high contributions on which there is no return’.
GSEE proposals for labour issues
On 29 August 2017, in a letter to the Greek Prime Minister, the General Confederation of Greek Workers (GSEE) presented its proposals on labour issues. The GSEE calls for legislative measures that will be a ‘minimum starting point for the practical restoration of labour protection’ and, in particular, for measures on collective bargaining such as:
- reinstating the possibility of extending sector-level collective employment agreements;
- reinstating the favourability principle;
- abolishing the possibility of ‘associations of persons’ signing collective employment agreements;
- the minimum wage (and reinstating the adjustment of the minimum wage through the national general collective employment agreement);
- strikes (including banning lockouts);
- collective redundancies (abolishing provisions that increase the limits above which redundancies are considered collective);
- redundancy payments;
- new forms of employment (abolishing the possibility of an employer unilaterally imposing job rotation);
- working time (reinstating the five-day working week in shops and abolishing the possibility of splitting working days in shops that are open all day);
- evaluating industrial relations processes.
In general, GSEE’s proposals revolve around abolishing the arrangements provided for in the current framework, and returning to arrangements that applied before the crisis, and before Greece was admitted to the EFSM.
Working together to combat undeclared work
At the end of September 2017, the Ministry of Labour announced that, in order to combat undeclared and uninsured work, it would shortly be tabling a draft law aimed at strengthening and improving cooperation between the Financial and Economic Crime Unit (SDOE) and the Labour Inspectorate (SEPE). The Ministry of Labour points out that SDOE auditors come across violations of labour law, especially undeclared work, on a daily basis. In order to respond quickly to such cases, it was considered necessary to strengthen the legislative framework and thereby facilitate and speed up the appropriate procedures.
It appears that after the period of immobility following the start of the economic crisis, social dialogue on the labour market institutional issues is now coming to life. The social partners are setting out their proposals to the government for labour market reforms. As many more important reforms are expected (for example, to the law on the right to strike), developments in the field will evolve rapidly.