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| Negociations on the Salary Law 12/11/2010 |
| (2010-11-12) |
| Last updated: 2010-11-15 14:16 EET |
Talks were held on Thursday by the Labor Ministry with unionists on the salary law, which have, once again, ended without results.
Union leaders say that the salaries of 80,000 civil servants are yet to be included in the draft budget for 2011, whose current form implies new layoffs and pay cuts.
Razvan Bordeianu, vice president of SED LEX, the National Federation of Public Employees, had this to say: “We have one constraint imposed by the IMF, namely we must reduce personnel expenses from 42 to 39 billion lei. We know that we will continue to see incomes dropping, as unpaid bonuses mean 17 percent lower incomes for civil servants and local administration employees. The draft budget does not cover the salaries of at least 7 percent of state employees. So we will certainly continue to see lower salaries that expected, or we will be forced to lay off employees.”
Although throughout the discussions, the Government didn’t bring any suggestions regarding minimum wages to the table, unions proposed a level of 750 lei, while employers’ associations suggested 705 lei. Ioan Cezar Coraci, president of UGIR 1903, the General Federation of Romanian Industrial Employers, believes that an increase above 705 lei is unsustainable in the economic background. He adds that lower labor taxes could lead to higher salaries.
Here is Ioan Cezar Coraci: “A minimum wage of 705 lei would, to a large extent, sit well with the economy, with minimal conditions accepted by unions, a slight decrease in salary scales for university graduates and maybe low-skilled workers as well. A minimum wage higher than 705 lei would cause difficulties and could not be financed. It would most likely eventually lead to many companies resorting to illegal employment or even going bankrupt.”
The unified salary law was scheduled to be passed by the end of September, but no agreement could be reached between unions and the Executive. The law was supposed to take effect on January 1st 2011. According to unions, the unified salary bill, in its current form, stipulates a 16 percent increase of salaries for next year, leading to the partial recovery of the 25 percent losses recorded since July.
Romania made a commitment to the IMF to lay off 70 thousand employees this year and 15 thousand the next. This, along with eliminating paid vacations and the 13th salary, a yearly bonus equaling one month’s pay, are conditions that the Government in Bucharest must fulfill in order to be granted the next installments of its IMF loan.
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