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Italy, Labour market reform, unemployment

Amended labour reforms head to Italian parliament

CGIL studies new text as Democrat Party declares it ‘an important step forward’ and Communists dismiss reforms as further step towards ‘transforming workers into a commodity’

Italian Premier Mario Monti softened his planned labour reform that would have made it easier for employers to lay off workers on Wednesday.

Responding to opposition from the center-left Democratic Party and the country’s biggest trade union CGIL, the government said that under the amended plan courts will be allowed to order employers to take workers back in cases where companies have falsely claimed economic reasons for cutting jobs

‘In other cases, a severance package is in order,’ said Labor Minister Elsa Fornero. ‘The reform represents a collective net gain,’ she claimed.

The measures included raising payroll taxes on temporary contracts and creating apprenticeships.

Greater numbers of workers will also be eligible for welfare schemes, though benefits will be for shorter periods in some cases.

The new bill was to be sent to in the next few days and Monti said he hoped it would be quickly approved, but it is likely to be some months before the law is passed.

‘We have tried to bear in mind the interest of the whole country and not just one category. The reform clearly adds to job security risks for insiders, but it also boosts prospects for those outside the fortress,’ Fornero said.

The unelected government, which took over from media mogul Silvio Berlusconi in November as speculators taking advantage of the eurozone debt crisis hounded Italy, says it hopes a knock-on effect of the labour reform will be a boost to the country’s sluggish economy.

Monti has come under fire for failing to do enough to boost Italy’s economy, which entered recession in the second half of last year.

The plutocrat former EU Commissioner argues measures his government have taken, including sweeping budget cuts and tax rises, are necessary to reassure financial markets worried about Italy’s public debt mountain, which is equivalent to 120.1 percent of its gross domestic product.

Yet, in an interview in La Stampa newspaper on Wednesday, Monti acknowledged that the austerity measures implemented ‘have and will have a recessionary effect’ and the government ‘cannot ignore social suffering.’

The negative impact on living standards of the crisis and austerity medicine on ordinary Italians was confirmed with new Bank of Italy data released earlier this week that shows incomes of households fell 4% in 2008 and 2009. And in 2011, public sector workers, who make a large chunk of the workforce, saw real wages fall by 2.6%. But not everybody is feeling the pinch though – also published this week by the Bank of Italy was data that showed the 10 richest individuals in the country have as much wealth as 3 million of the poorest.

For Paolo Ferrero, leader of the Communist Refoundation party, the amended employment law proposals are ‘ a cumbersome mechanism that drives workers to accept an economic settlement and offloads the responsibility on judges’, opening the door to a postcode lottery of job security.

‘We move from a right to a monetization and this is a further step in transforming the worker into a commodity. It is very serious that the Democratic Party lend themselves to the destruction of workers’ rights.’

Democrat Party leader Pier Luigi Bersani declared Wednesday night that the amended text was ‘an important step forward.’

The CGIL trade union central had said that the original plans would do nothing to encourage new hiring and would leave large numbers of mainly younger workers stuck on dead-end short term contracts. And it had pledged a campaign of industrial action including a one-day general strike against the proposals.

Wednesday night the union stated it was studying the text.

About revoltingeurope

Writer on Europe's Left, trade union and social movements @tomgilltweets or @revoltingeurope


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