Transcript Slide 1

EUROPEAN DOWNTURN: A
CHALLENGE YET TO OVERCOME
WHAT DOES EUROPE MEAN FOR THE WORLD?
3
WHAT DOES EUROPE MEAN FOR THE WORLD?
4
WHAT DOES EUROPE MEAN FOR THE WORLD?
5
HARMONISED UNEMPLOYMENT RATE WORLDWIDE
2010 Q4
6
HARMONISED UNEMPLOYMENT RATE IN THE “EURO AREAS”
7
EMPLOYMENT GROWTH RATES IN EURO AREA AND EU27
8
HARMONISED UNEMPLOYMENT RATE BY COUNTRY
9
WHERE DO WE CURRENTLY STAND IN THE CRISIS?
10
WHERE DO WE CURRENTLY STAND IN THE CRISIS?
11
WHERE DO WE CURRENTLY STAND IN THE CRISIS?
“Three areas at the core of efforts that will contribute to
shaping the contours of the post-crisis order (…)
First, institutions.
The second area at the core of our efforts concerns reforms of
the financial sector.
The third area of work concerns fiscal consolidation”.
Jean-Claude Trichet, President of the ECB
at the conference “The ECB and Its Watchers” XII
Frankfurt am Main, 9 July 2010.
12
WHERE DO WE CURRENTLY STAND IN THE CRISIS?
 “By February 2010 the EU unemployment rate had risen to its highest level in a
decade (9.6 %). Within the EU, Member States such as the Baltic States, Ireland,
and Spain have undergone wrenching adjustments in their labor markets, in part
linked to the collapse of construction booms or property bubbles”.
Employment in Europe report (2010).
 “The labor market is in a deplorable state. I must admit that the crisis will
not pass unless the unemployment rate decreased significantly”,
Dominique Strauss-Kahn
(Executive Director of the International Monetary Fund)
13
WHERE DO WE GO NOW?
The picture varies across Member States:
 For many it has led to a substantial increase in unemployment, and potentially in
long-term unemployment,
 For some others job losses have been rather restrained to date, especially
compared to certain of the EU’s global competitors (Japan and United States).
14
WHERE DO WE GO NOW?
General recourses battling unemployment during the crisis
 Increase internal flexibility:
 Flexible working time arrangements
 Shorter hours or temporary partial unemployment,
 Temporary closures,
 Nominal wage concessions
 Employment stability in some sectors
General absence of new policies to create new job opportunities.
15
WSG 2011 European Regional Meeting
Legislative measures adopted by
Italian Government (and not only) to
face the crisis
Raffaella Betti Berutto
Amsterdam, 24 March 2011
“AMMORTIZZATORI SOCIALI”
(I.E., SOCIAL SHOCK ABSORBER)
The “ammortizzatori sociali”
are a Governmental support offered to people who have
been suspended or laid off because the employer is in
financial crisis
17
THE “SOCIAL” SHOCK ABSORBERS




CIGS
Solidarity Agreement
Mobility Indemnity
Unenployment Indemnity
18
“CASSA INTEGRAZIONE GUADAGNI”
Is a Government redundancy fund (partially funded by employers’
national insurance contributions and by the INPS) ensuring that
some form of compensation is paid to those who have been
suspended from work or who are working reduced hours.
Payments to employees may be made under one of two regimes:
the so-called ordinary regime (Cassa Integrazione
Guadagni Ordinaria - Ordinary Wages Guarantee Fund
(CIGO)) which applies where there is a temporary
interruption or reduction in work caused by factors such as
market trends or flooding;
the extraordinary regime (Cassa Integrazione Guadagni
Straordinaria - Extraordinary Wages Guarantee Fund (CIGS))
which applies in the event of the employer’s insolvency,
restructuring, or reorganisation, cessation.
19
EXTRAORDINARY WAGES GUARANTEE FUND
(CIGS)
Reasons for intervention: financial crisis
CIGS for financial crisis is granted if the following conditions are met :
(a) negative or backwards trend of the enterprise, shown by the
presence of economic-financial indicators referred to the previous
two-year period
(b) The headcount has not been increased in the previous two-year
period
(c) existence of a recovery plan setting forth the actions to be taken to
overcome the financial crisis
(d) submission of an headcount relocation
plan if the employer
envisages to have redundancies
Remarks:
(i) The requirements under (a) and (b) are not required if the crisis has been caused by a
“sudden and unexpected” event, to be evidenced, of the enterprise, with regard to its
unpredictability, the quickness with which it caused adverse effects and the thorough
autonomy from the business management policies. See circular of the Ministry of Labour
Prot. No. 4/0005251 of March 30, 2009 about the possibility to ascribe the events
originated by the economic crisis of 2009 to the notion of sudden and unexpected event
(ii) In addition, until 2001 it is not necessary to submit the recovery plan in presence of a
request for CIGS due to the occurrence of a sudden and unexpected event (Ministerial
Decree of June 29, 2009).
(iii) Lately, CIGS has been admitted in case of business crisis with cessation of the business of
the entire enterprise or of one of its sectors, with contextual submission of an headcount
relocation aimed at decreasing the recourse to the collective lay-off.
20
EXTRAORDINARY WAGES GUARANTEE
FUND(CIGS)
Reasons for intervention
•
Restructuring: remarkable changes in the business structures
(equipment or premises) with following investments
•
Reconversion: introduction of production of different product
fields by changing the production cycles of the existing facilities
•
Reorganization:
organisational
and
management
rationalization aimed at facing business inefficiencies
Various ministerial decrees lay the basis for the admission of the
enterprises to CIGS vis-à-vis the three specific cases at issues
indicated above
21
EXTRAORDINARY WAGES GUARANTEE
FUND(CIGS)
Reasons for intervention: insolvency procedures (art. 3
of Law no. 223/91)
•
Declaration of bankruptcy
•
Issue of the measure of compulsory winding-up
•
Subjection to receivership
•
Admission to composition with creditors, consisting in the assignment
of assets
•
Debt restructuring pursuant to art. 182-bis of the Bankruptcy Law (see
Note of the Ministry of Labour prot. No. 14/4314 of March 17, 2009)
22
EXTRAORDINARY WAGES GUARANTEE
FUND(CIGS)
Sectors concerned
Beneficiary workers
•
•Blue collars
•White collars
•Quadri
having at least a seniority of 90 days at the
company
•
Employers of industrial staffed
with more than 15 employees in
the last six-month period
Employers
of
commercial
businesses staffed with more than
200 employees (monthly survey)
Remarks:
(i) Specific sectors are excluded from
CIGS such as hotel, and banking
industry
(ii) Each year, the admission to CIGS
is
provided
for
commercial
businesses with more than 50
employees, supervisory firms with
over 15 employees, travel and
tourist agencies with over 50
employees
Remarks:
(i)they may be both open-ended and fixedterm workers, both full-time and part-time
(ii)Executives and apprentices are left out
(yet, see infra for the “in derogation” shock
absorbers for apprentices)
(iii)the criteria for the identification of
workers to be suspended as well as the
modalities for the personnel turnover shall
be the subject of a unions consultation (see
infra)
(iv)Personnel turnover: if the enterprise
envisages,
for
technical-organisational
reasons linked to the maintenance of the
ordinary efficiency levels, not to adopt any
turnover among workers performing the
same tasks and working in the production
unit concerned by suspension, it shall
indicate the reasons for it
23
EXTRAORDINARY WAGES GUARANTEE FUND
(CIGS)
Duration of the intervention
General rule: for each production unit, the CIGS cannot exceed 36
months in a five-year period (Law no. 223/91).
Specific rules linked to the different reasons for intervention:
• the duration of the programme for business crisis shall not
exceed 12 months; an extension for the same reason may be
provided for only once 2/3 of the initial term has elapsed
• the duration of the business restructuring, reorganization or
reconversion shall not exceed 2 years, with the possibility of
two extensions, each of one not exceeding 12 months, for such
programms showing a particular complexity
• In case of insolvency proceedings: 12 months with possibility to
a six-month extension
24
EXTRAORDINARY WAGES GUARANTEE
FUND(CIGS)
Procedure for the admission to CIGS
•
Unions consultation



•
Submission of the application to the Ministry



•
The employers who intend to request the admission to CIGS must promptly informs
the Unions
Within 3 days after the above mentioned notice, the employer or the Unions
submit to the competent administrative office, the application for joint examination
of the business situation
The consultation procedure must be completed within 25 or 10 days (depending
upon whether the employer employs over or less 50 employees)
Within 25 days after the end of the pay-period outstanding in the week when the
business suspension or reduction began
After completion of the preliminary proceedings, the Ministry issues the measure for
the admission to CIGS
In case such admission is refused, it is possible to request a review, without
prejudice the possibility to have recourse to the Regional Administrative Court
Submission of the request to INPS
 Within 25 after the end of the pay-period outstanding as of the date of publication
of the decree granting CIGS on the Official Gazette
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EXTRAORDINARY WAGES GUARANTEE FUND
(CIGS)
Amount of the CIGS indemnity
80% of the overall pay that the employee would have received for hours not
worked, with the following monthly ceilings (2011 ceilings):
-
€ 906.80 gross per monthly pay up to € 1,961.80
€ 1,089.89 per monthly pay exceeding € 1,961.80
In principle, the CIGS indemnity is paid in advance by the employer and
reimbursed to the latter by INPS. Should the enterprise be in an
exceptionally critical financial situation, INPS may effect a direct payment
(nevertheless, see infra, CIGS in derogation).
Contribution for CIGS
•
Current contribution: 0.90% (of which 0.30% to be borne by workers), to be
calculated on the taxable salaries of the employees entitled to CIGS
•
Additional contribution: 3% (up to 50 employees) and 4.50% (over 50
employees), to be calculated on the amount of the wage integration paid to
workers; it shall be doubled starting from the first day of the 25th month after
the beginning of CIGS; no additional contribution shall be due for CIGS in
case of insolvency proceedings
26
DEFENSIVE SOLIDARITY AGREEMENTS (CDS)
“Contratto di solidarietà” - Special features
•
The solidarity agreement is an agreement between employer
and unions concerning the reduction of working hours in order
to avoid headcoutn reductions
•
The loss of salaries deriving from the reduced working hours is
partially reimbursed by INPS.
•
Term: 12/24 months which may be extended for further 24
months within the maximum limit of 36 months whithin the
five years period.
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DEFENSIVE SOLIDARITY AGREEMENTS
(CDS)
Beneficiary workers
Sectors concerned
The same employeres
within the scope of CIGS
falling
Remarks:
The
employers
admitted
to
insolvency proceedings are left
out
•
•
•
Blue collars
White collars
Quadri
Remarks:
(i) Fixed-term workers are left
out
(ii) Executives and apprentices
are left out
28
DEFENSIVE SOLIDARITY AGREEMENTS
(CDS)
Wage integration for workers
Benefits for enterprises
•
•
The additional contribution
established in case of CIGS is
not provided for
•
Social security contributions
reduction
for
the
hours
worked equal to 25% (if such
reduction ranges between 20
and 30%) and to 35% (if
such
reduction
exceeds
30%); the reduction is higher
in the areas of the South of
Italy
•
Integration of 60% of the wage
lost vis-à-vis the working time
reduction
The monthly ceiling provided for
CIGS is not applicable
29
DEFENSIVE SOLIDARITY AGREEMENTS
(CDS)
DSA for enterprises not subject to CIGS
(2nd-type solidarity agreements)
•
Enterprises which do not fall within the scope of CIGS may enter into
solidarity agreements (a) in order to avoid or reduce the excess personnel
during the mobility procedures or else (b) in order to avoid individual
dismissals for objective justified reason
•
For the reduction of working hours, a contribution equal to the half of the
wage for the total working hours not worked, equally divided between the
employer and the workers concerned by the reduction, is paid for a period
not exceeding 24 months, that may be extended for maximum further 12
months
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MOBILITY INDEMNITY
Main features
•
The mobility indemnity (i.e., the indemnity paid by INPS to the dismissed
employees) applies in the following cases:
 An enterprise admitted to CIGS needs to start, during the programme
or upon completion of the same, the dismissal of one or more people
 An employer employing more than 15 employees intends to perform –
after a reduction or change of business or work, or else after cessation
of its business – at least 5 dismissals, in a period of 120 days, in each
production unit or in more production units within the territory of the
same province (collective dismissal procedure)
•
In both cases, the dismissal is subject to the completion of the following
process as per Law no. 223/91:
 Notice to the trade unions
 Unions’ consultation which may take up to 75 days
 dismissal
•
Regulatory source: Law no. 223/91
31
MOBILITY INDEMNITY
Requirements to benefit from the Mobility Indemnity
Workers dismissed and enrolled in the regional unemployment records
(so-called mobility lists) who:
 have a seniority of 12 months, of which at least 6 worked
 submit the relating application
enjoy the Mobility Indemnity
The Mobility Indemnity is applicable for personnel of enterprises falling
within the scope of CIGS
The beneficiary workers are blue collars, white collars and quadri having
an open-ended labour contract
32
MOBILITY INDEMNITY
Duration of the Mobility Indemnity
Age of worker
Employment in the
North-Centre
Employment in the
South
Until 39 years
Maximum duration 12
months
Maximum duration 24
months
From 40 to 49
years
Maximum duration 24
months
Maximum duration 36
months
From 50 years
Maximum duration 36
months
Maximum duration 48
months
INPS Circular no. 95/2008: for the purposes of the acknowledgement of the 12-month increase,
reference should be made exclusively to the place where the enterprise permanently organizes the
activity of the worker concerned.
33
MOBILITY INDEMNITY
Amount of the Mobility Indemnity
The Mobility Indemnity is determined – detailed as follows - according
to the wage integration that the worker has received (mobility for
CIGS) or that he/she would receive (mobility for collective dismissal) in
the period immediately preceding the termination of the labour
relationship:
100% in the first 12 months
80% from the 13th month on
with the following ceilings (2011 ceilings)
€ 906.80 gross, for salaries up to € 1,961.80
€ 1,098 gross, for salaries exceeding € 1,961.80
34
MOBILITY INDEMNITY
Financing of the Mobility Indemnity – Contribution to be borne by
employers
•
Monthly ordinary contribution (0.30%) borne by the employer during the
employment
•
Payment, for each worker to be dismissed, of:
 9 times the monthly mobility indemnity, in case of collective
dismissal process without an agreement with the unions;
 6 times the monthly mobility indemnity, in case of CIGS
 3 times, if the monthly mobility indemnity in case of collective
dismissal which ends up with an agreement with the Unions
•
Cases of exemption from the above payment:
 total exemption in case the insolvency proceedings triggering
heacount reductions
 the employer who dismiss the worker and offers an open-term job
having certain characteristics, benefits from a reduction of the
mobility cost
35
THE SO-CALLED “MOBILITY FOR SMALL
EMPLOYERS”
•
The workers dismissed for objective justified reason by enterprises
employing up to 15 employees, for whom the mobility procedure
cannot be started, may, upon request, register in the regional
unemployment records (mobility lists).
•
Such registration does not entitle workers to the mobility
indemnity. However, employers who hire workers enrolled with
enjoy social security benefits.
36
SOCIAL SHOCK ABSORBERS
“IN DEROGATION”
37
SOME GENERAL PRINCIPLES
•
In compliance with art. 36, paragraph 2, of Law no. 203/2008 (the Budget
Law 2009), as amended by art. 7-ter, paragraph 4, of Legislative Decree no.
5/2009, the CIG, mobility and unemployment indemnity may be granted
uninterruptedly, for periods not exceeding 12 months, in derogation of the
regulations in force.
•
The financial resources allocated for shock absorbers “in derogation” of the
regulations in force may be used for all kinds of subordinate employment,
including the apprenticeship and temporary workers supplied by external
employment agencies (art. 19, paragraph 8, of Legislative Decree no.
185/2008).
The shock absorbers “in derogation” therefore potentially guarantee a
thorough coverage for all kinds of subordinate workers of the private
sector.
•
On February 12, 2009 the Government, the Regions and the Autonomous
Provinces executed an Agreement for the management of the shock
absorbers in derogation in the two-year period 2009-2010 which has
been extended to 2011 and specific agreements have been entered into
between the Ministry of Labour and any single Regions.
The Regions have a basic role in the complex system of the shock
absorbers in derogation. Reference must be made to the specific regional
agreements in order to identify the type and regulation of the shock
absorbers in derogation to which an enterprise may be entitled.
38
THE MAIN ANTI-CRISIS MEASURES
Unemployment indemnity for suspension of work (art. 19,
paragraph 1, letters a) and b), of Legislative Decree no. 185/2008)
Unemployment indemnity for apprentices suspended or dismissed
(art. 19, paragraph 1, letter c), of Legislative Decree no. 185/2008)
CIG (ordinary and extraordinary) in derogation
Mobility in derogation
Una tantum for consultants engaged under a project collaboration
agreement (art. 19, paragraph 2, of Legislative Decree no.
185/2008)
39
CIG AND MOBILITY IN DEROGATION
•
Workers may benefit from CIG and mobility in derogation on condition that
they are provided with the personal requirements usually requested in order
to enjoy the CIG indemnity or the mobility indemnity, i.e. respectively (i) 90
working days of length of service as far as CIG is concerned and (ii) 12
months of length of service as far as the mobility indemnity is concerned
•
INPS is authorized to pay in advance CIG and mobility in derogation.
•
Contribution due in case of CIGS in derogation: the employers are not
bound to pay any ordinary contribution (0.90% of which 0.30% to be borne
by workers) but only the additional contribution (3% or 4.50% depending
on whether the employer has up to or more than 50 employees), only for
the period in which they benefit from the CIGS in derogation. No additional
contribution shall be due if the employer is undergoing an insolvency
proceedings.
•
INPS explained that the periods of CIG in derogation do not fall within the
calculation of the maximum ceiling of 36 months in a five-year period.
40
UNA TANTUM PAYMENT FOR PROJECT
COLLABORATORS
(ART. 19, COMMA 2, D.L. 185/2008)
•
Experimental measure effective for 2009 / 2011 period
•
Objective requirements:
 Termination of the consultancy agreement
•
Subjective requirements
 Enrolment with INPS
 Working for only one principal
 Preceding year: income exceeding € 5,000 (but less than € 14,240)
and a social security seniority of at least 3 months
 In the relevant year: social security seniority of at least 3 months
 Declaration of availability of undergoing a training and professional
requalification course
•
Una tantum payment equal to 10% of the income earned in the preceding
year
41
UNEMPLOYMENT, “JOB GAP” AND
EMPLOYMENT EXPECTATION
Unemployment rate
According to Confindustria economists, unemployment in Italy in 2011
will touch its peak and begin to decline until 2012
It is estimated that the unemployment rate will reach 9% in 2011
“Job gap”
To return the pre-crisis employment rate, according to Confindustria,
should be designated in more than 440,000 employees in 2011
In Europe so far, the "job gap" was filled in Germany due to increased
employment in the last three years
Employment level rate
After a decrease in 2010 (-1.7%, -2.6% in 2009), the employment
level rate should remain mainly stable in 2010 (+0.1%)
The rise in the employment level rate should occur according to
economics forecast in 2012 only (+0.9%)
42
SOCIAL SHOCK ABSORBERS
IN DEROGATION
Year 2011
In 2011 the recourse to anti-crisis measure is expected to
be still very high due to the slow due to the slow economic
recovery and the refinancing of social shock absorbers by
the Italian Government
315.000 employees will be involved
Year 2012
166.000 employees are expected to be interested in the
use of social shock absorbers in derogation
43
OTHER INSTRUMENTS
TO FACE THE CRISIS AT COMPANY
LEVEL
early retirement
flexible working time
assignment of workers to different working duties
(even lower)
“concession barganing”
Collective barganing agreement at company
level departing from the national collective
barganing agreements
Derogation in peius: are in
compliance with Italian
law
44
FANCIFUL INSTRUMENT
TO FACE THE CRISIS:
THE MIRAFIORI PLANT’S AGREEMENT
(FIAT CASE)
Background
In Italy a large number of principal terms and conditions of
employment are governed by collective agreements applying to
almost every employee.
Collective agreements are made between
trade unions (organizzazioni sindacali) and
employers’ organizations (associazioni di categoria)
(usually grouped on an industry-wide basis)
Collective agreements are generally applicable only if
the employee and employer are members of the
contracting trade union and employers’
organization or the parties have otherwise agreed to be
bound by its terms.
45
FANCIFUL INSTRUMENT
TO FACE THE CRISIS:
THE MIRAFIORI PLANT’S AGREEMENT
(FIAT CASE)
Background
FIAT as member of the employers’ organization (associazione di
categoria) so-called CONFINDUSTRIA applies the
Collective bargaining agreement for employees of
metal-mechanic sector (“Metal-mechanic CBA”)
46
FANCIFUL INSTRUMENT
TO FACE THE CRISIS:
THE MIRAFIORI PLANT’S AGREEMENT
(FIAT CASE)
FIAT’S WILL
Derogation in peius of the Metal-Mechanic CBA with regard to
Work shifts
Overtime
Absences due to sickness
Daily breaks
47
THE MIRAFIORI PLANT’S AGREEMENT
(FIAT CASE)
Background
In particular,
SICKNESS
Under Italian law, during the sickness employees are entitled
to retain their jobs for a certain period of time (periodo di comporto)
(generally 180 days – 12 months executives pursuant to the national
collective bargaining agreements);
to receive statutory sick pay (indennità di malattia) which is paid
by INPS after 3-day of sickness, INPS pays 50% of the normal salary
from 4th to 20th day, 66% over 20th day).
Generally, the national collective bargaining agreements provide for that
the employer
pays the statutory sick pay during the first 3 days of absence
(100%) (periodo di carenza)
contributes up to 100% to the payment of the statutory sick pay
made by INPS.
48
THE MIRAFIORI PLANT’S AGREEMENT
(FIAT CASE)
AVERAGE SICKNESS ABSENCES
FIAT: 8%
In order to reduce such average FIAT introduced a
system whereby, if the average sickness absences
does not decrease to a certain treshold, those who
have been absent (more than twice within 12
months) for less than 5 days immediately preceding
or after holidays, will not be entitled to payment of
day first and day second over the 3-day period (socalled periodo di carenza) to be borne by the
employer pursuant to the applicable national
collective barganing agreement.
49
FANCIFUL INSTRUMENT
TO FACE THE CRISIS:
THE MIRAFIORI PLANT’S AGREEMENT
(FIAT CASE)
CGIL – one of the main Trade Unions, together with CISL and
UIL –
disagreed with FIAT’s proposal to derogate in peius
the Metal- Mechanic CBA
FIAT:
established a NEWCO
made a transfer of undertaking from FIAT to NEWCO
NEWCO:
is not a member of CONFINDUSTRIA therefore the MetalMechanic CBA is not applicable
entered into with CISL and UIL only a collective
bargaining agreement at company’s level replacing
the Metal-Mechanic CBA and implementing new rules
aimed at granting competitiveness (work shifts,
Overtime, absences due to sickness, daily breaks)
50
A DIFFERENT WAY TO BATTLE THE CRISIS:
WELFARE AT COMPANY LEVEL
(LUXOTTICA’S CASE)
Collective bargaining agreement at company level of
11 February 2009
Luxottica, introducing a best practice, agreed to build up a
“WELFARE PROGRAM” at company level for its
employees and their families
Assumption
The national collective barganing agreement is a frame in
which the employer can set up a governance closer to the
company’s and employees’ needs (including welfare
programs)
51
A DIFFERENT WAY TO BATTLE THE CRISIS:
WELFARE AT COMPANY LEVEL
(LUXOTTICA’S CASE)
GOALS OF LUXOTTICA
– recruit and retain talent
– motivate workers letting them feel “part of the
company” and “be the focus of the company’s policy”
– preserve the purchasing power of employees during
the crisis
not only through fixed and variable salary
but relying on innovative and complementary income
support which is alternative to more traditional systems
of remuneration
52
A DIFFERENT WAY TO BATTLE THE CRISIS:
WELFARE AT COMPANY LEVEL
(LUXOTTICA’S CASE)
INTERVENTIONS IN PLACE
Provision of non-monetary benefits (having a considerable economic
value) to protect employees purchasing power, to face family needs as
well as to allow better work-life balance needs (Collective bargaining
agreement at company’s level of December 14, 2009 and June 24, 2010)
integrative sanitary assistance to employees’ and their families
food expenditure
school (textbooks and scholarships to children of employees)
careers
social care supporting workers with family problems associated with
disability, elderly care and drugs addiction
loans
fitness
training courses
work-life balance plans (i.e., childcare, laundry, teleworking, etc.)
53
FURTHER ANTI-CRISIS SOLUTIONS
provide tax incentives for businesses
reduce the mismatch between demand and offer of
employment
develop the welfare program at company level
decrease taxes on productivity bonus
reduce the cost of labor increasing the employees’
net salary
54
Raffaella Betti Berutto
GIANNI, ORIGONI, GRIPPO & PARTNERS
Via delle Quattro Fontane 20, 00184 Rome, Italy
telephone: +39-06478751
fax: +39-064871101
mailto: [email protected]
www.gop.it
55
Battling the crisis
Approaches in Germany to prevent mass dismissals
Düsseldorf,
Oktober
2007
WSG
European30.
Regional
Meeting
th
Amsterdam, March 24 2011
Martin Reufels
Concept of “Kurzarbeit“

Temporary Reduction of regular weekly Working Hours per
company / establishment / organisational entity (agreed by
collective bargaining agreement / shop agreement / individual
employment contract)

Reduction of Pay

67% of net loss contributed by social security authorities

up to 24 months
Mit Recht erfolgreich – Unternehmensporträt | 30. Oktober 2007
2
57
1)
for Employer:
- huge and considerable savings by employer especially in case
of
„Kurzarbeit 0“.
2)
for Employee:
- retains job
- no considerable loss of pay, especially when add-on
contributions
are granted by employer (“full pay and no
work”)
3)
for social security authorities / government:
- low percentage of unemployment
- low spending on unemployment aid (re-directed into direct
support
of “Kurzarbeit” employees)
Mit Recht erfolgreich – Unternehmensporträt | 30. Oktober 2007
3
58
Additional Programs

Qualification Programs and Vocational Training at “Kurzarbeit 0”
or “Health Program”

“Subsidies” for “seminar & conference” industry

Evaluation & Consultation of employees by social security
authorities
4
59
Mit Recht erfolgreich – Unternehmensporträt | 30. Oktober 2007
Factual Evaluation
- exists since 1910
- helped to “bridge” excess labour supply through a recession
- has been successful in the 1970s /80s, i.e. construction bubble
- “solution” to prevent unemployment in aftermath of financial crisis
(e.g. 60.000 workers at Volkswagen)
- helps only in short-term phenomena
- helps to prevent social unrest (employees keep their job)
Mit Recht erfolgreich – Unternehmensporträt | 30. Oktober 2007
5
60
Factual Evaluation
in total:

has been successful, thanks to sudden
recovery & export boom in Germany.

has prevented mass dismissals and allows
companies to immediately “boost up”
business in times of recovery.
Mit Recht erfolgreich – Unternehmensporträt | 30. Oktober 2007
6
61
Thank you
for your attention!
7
62
Mit Recht erfolgreich – Unternehmensporträt | 30. Oktober 2007
Berlin
Friedrichstraße 149 · D-10117 Berlin
T +49 (0)30 88 00 97-0 · F +49 (0)30 88 00 97-99
[email protected]
Brüssel
Avenue Louise 140 · B-1050 Brüssel
T +32 (0)2 646 20-00 · F +32 (0)2 646 20-40
[email protected]
Chemnitz
Weststraße 16 · D-09112 Chemnitz
T +49 (0)371 382 03-0 · F +49 (0)371 382 03-100
[email protected]
Düsseldorf
Cecilienallee 5 · D-40474 Düsseldorf
T +49 (0)211 600 55-00 · F +49 (0)211 600 55-050
[email protected]
Frankfurt
Grüneburgweg 102 · D-60323 Frankfurt am Main
T +49 (0)69 975 61-0 · F +49 (0)69 975 61-200
[email protected]
Hamburg
Bleichenbrücke 9 · D-20354 Hamburg
T +49 (0)40 35 52 80-0 · F +49 (0)40 35 52 80-80
[email protected]
Köln
Magnusstraße 13 · D-50672 Köln
T +49 (0)221 20 52-0 · F +49 (0)221 20 52-1
[email protected]
München
Prinzregentenstraße 48 · D-80538 München
T +49 (0)89 540 31-0 · F +49 (0)89 540 31-540
[email protected]
Mit Recht erfolgreich – Unternehmensporträt | 30. Oktober 2007
63
Battling the Crisis: Legislative Approaches in
Russia for Competitiveness and Flexibility in the
Labour Market
WSG European Regional Meeting 2011
Amsterdam, Netherlands
Irina Anyukhina, ALRUD Law Firm
March 24, 2011
Unemployment in Russia
6.6%
7.5%
8.4%
2008
2009
2010

Statistical information for the years 2009 and 2010 is calculated in accordance with the methodology of
the International Labor Organization.

Statistical information for year 2008 is approximate.
65
Measures for improvement

Anti-сrisis Government Program
–
Labour market support
–
State financing
–
Support of business

Legislative Changes
66
Labour Market Support

Requalification and professional education

Temporary working positions

Relocation of dismissed employees in other regions

Support of small business and self-employment

Monitoring dismissals

Monitoring introductions of reduced working day

Promote information awareness of employees
67
Financial Support

Subventions from the Federal budget to regional budgets

Strategic sector

Domestic manufacturers

Township-forming companies

Small business
68
Legislative Changes
Important for employer

Simplification
of
dismissal
procedure for trade union leaders
No obligation to obtain the consent
of a trade union organization
(except for some cases)

Lower contributions to the State Social
Benefits for IT companies
Funds
Important for employee

Increase
of
unemployment
Maximum amount increased by 57 %
compensation

Increase of minimum wage rate
Minimum amount increased by 80 %
69
Major Projects
Winter Olympic Games in
Sochi 2014
Skolkovo Innovation
Center

New working places

Attraction of foreign
highly-qualified
specialists

Tax and organizational
benefits
Summit of APEC
in 2012
Establishing of Clusters
(Pharmaceutics,
tourism, etc)
70
Migration Policy
Restriction of quota for issuance of work permits for foreign nationals:

Year 2010: decreased by approx. 51% vs year 2009

Year 2011: decreased by approx. 10% vs year 2010
Simplification of procedure of engagement of foreign highly-qualified specialists

No special permit for the employer

Quick obtaining of work permit

Simplified procedure of registration on the territory of Russia

Simplified procedure of registration for accompanying family members
71
Hot Topics on the Agenda

Simplification of dismissal procedures

Legalization of free-lance

More grounds for fixed-term labour contract

Work on 1.5 wage rate, 60 hours per week

Outsourcing

Labor or civil contract

Introduction of institutional labour arbitration

Change of procedure of beginning of a strike

Preferential regime for innovative business
72
Thank you for your attention!
ALRUD Law Firm
Irina Anyukhina, [email protected]
17 Skakovaya Street, 125 040 Moscow Russia
tel.: + 7 495 234 96 92, fax.: + 7 495 956 37 18
www.alrud.com
73
WSG European Regional Meeting
Amsterdam, Netherlands, 24 – 25 March 2011
Ukraine seeks labor reform as part of anticrisis program
Armen Khachaturyan, Senior Partner
15 years of
reaching the stars for our clients
Proposal of concurrent pension and labor reform
(the bill to be reviewed by Parliament in March 2011)
● Legalizing wages and jobs through tightened employers’ liability (41 % of official social taxes on a
payroll leads to USD 25 bln of unoffical wages; fines to grow 10 times to USD 1,000 - 3,000 for
unofficial wages and jobs; tax administration and pension fund are authorized to impose fines;
measures to bring almost USD 9 bln to pension fund)
● Introduction of indicative wages subject to social insurance and pension contributions (reference
to similar law in Bulgaria, but criticism from experts)
● Restructuring of employer’s and employee’s shares in total social tax on wages/payroll (currently
employee pays only 2% of total contribution to pension fund while employee’s share is 10.25% in
Austria and 8.205% in Bulgaria)
‹#›
Draft New Labor Code
(second reading is pending in Parliament, current Labor Code is effective since 1971)
● Refusal from pro-employee approach
● Certainty in hiring procedure (written form of employment agreement; freedom of contract
outside imperative rules of law, administrative order is possible only upon employee’s consent;
essential terms include description of position, structural unit, term, compensation, work time
and labor protection)
● More grounds for conclusion of term employment agreements (currently only 10% of all
employment agreements in Ukraine while majority in western jurisdictions)
● Possibility of agreed unpaid vacation during suspension of works
● Reclassification of contractor’s agreements into employment agreements
● Extension of probation from 3 to 6 months with de minimis severance pay
‹#›
Draft New Labor Code
● Possibility of extension of work time to 12hours per day and 48 hour per week, provided,
however, that an average work day/week within a month does not exceed standard 8/40 hours
● Voluntary 6 day work week eliminates two-job arrangements
● Employer’s right to issue regulations (orders, instructions), including for covering legal issues at
absence of collective bargaining agreement
● Cancellation of vacation for passing exams in educational institutions
● Limitation of rights of small trade unions in favor of monopoly of federation of trade Unions of
Ukraine
● Unilateral change of contract on economic grounds
● Increase of grounds for termination of employment (violation by management of shareholders’
rights, softer definition of redundancy as certain economic, technological, structural or
organizational conditions resulting in impossibility or non feasibility of employment, but
employer’s successorship is not an employment termination ground)
‹#›
Thank you for your attention!
Mit Recht erfolgreich – Unternehmensporträt | 30. Oktober 2007