The pending abolition of an administrative pre-approval clause to allow mass layoffs, mostly entailed in the obligatory consent of such a prospect by the relevant labor minister, generated heated political reactions in the country this week.
Abolition of the clause is detailed in a draft “supplementary memorandum” disclosed this week and published in full by “N” on Tuesday.
The strict framework governing mass layoffs in Greece has been in place for the past 35 years. Creditors, especially the IMF, have pressed for a liberalization of this framework, arguing that the restructuring of troubled or bankrupt enterprises often necessitates the firing and subsequent rehiring of workers under more flexible contracts — usually unfavorable for the latter.
In the face of stinging criticism by the opposition a day earlier, sources affiliated with the labor ministry defended the pending change by claiming that “creditors’ extreme demands for a full liberalization of mass dismissals were deflected.”
Main opposition New Democracy (ND) MP Yannis Vroutsis, a former labor minister, took to Twitter to charge that the leftist-rightist government had indeed agreed to free-up mass dismissals, essentially bowing to creditors’ demands.
The reference to the issue in the supplementary memorandum reads:
“As a prior action, amend the legislation on collective redundancies [Law 1387/1983] to replace the current framework of administrative approval of collective dismissals with a notification procedure of maximum three months which will not involve ex-ante approval…
i. Consultations with the workers’ representatives shall last up to 30 days.
ii. The company will communicate to the public employment service (OAED) of the list of dismissed employees, to help ensure that they are registered with the public employment service.
iii. The company, after the legally required relevant consultations with the workers’ representatives, may submit a ‘social plan’, outlining the possible accompanying measures foreseen to limit the social consequences of the dismissals, in line with the economic possibilities of the enterprise…
The authorities will verify that all required information has been provided by the employer and the consultation process has taken place, which will allow collective redundancies to take effect earlier than the standard three-month period. Otherwise, collective dismissals can take effect 3 months after the notification to the public authorities.”
