26/07/2010: State to receive higher proportion of pension funds
The Polish Labour Ministry has published a proposed amendment to the pension law that would reduce the proportion of employee's salaries that are paid into Open Pension Funds (OPF) from 7.7% to 3%. Under the proposals the balance of the contributions currently payable to OPFs would be directed towards the state-controlled social security system thereby reducing the public sector deficit. In return OPFs would be able to increase the proportion of their funds held in stocks and shares from 40% to 90%.
23/07/2010: Greater numbers subject to wealth tax
Over the last ten years the number of people who qualify for wealth tax in France has trebled to 566,000. The current threshold for tax to apply is 790,000 euros. The value of an estate is normally determined on January 1st of the year when an individual qualifies and tax is payable on the total of worldwide assets. However, foreign assets do not qualify for the first five years of residency in France.
22/07/2010: Closing the door on knowledge migrants
A new temporary limit has been placed on highly-skilled migrant workers from outside the EU entering the UK to work without an existing job offer. This is being achieved by raising the points-based threshold for entry and applying an annual cap of 5,400. The limit will apply until March 2011 when a new permanent quota will come into force. The size of the quota will be determined by the government after consultation with employers.
21/07/2010: Opposition to rise the the minimum wage
The Confederation of Portuguese Industry (CIP) has informed the government that a rise in the national minimum wage next year cannot be justified. In 2006 employers and trade unions agreed to a gradual increase in the wage to 500 euros a month. However, according to CIP, economic conditions have changed significantly over the last four years and there is now no case to raise the rate by a further 25 euros.
20/07/2010: Fall in use of short-time work scheme
The number of people working on a short-time basis in Germany fell by 250,000 between January and April 2010. In April there were 613,000 working short-time, well below its peak of 1.5 million in May 2009.
20/07/2010: Employees vote to reduce labour costs to save jobs
Workers at General Motor's automatic transmission plant in the French city of Strasbourg have voted to accept changes in their terms and conditions that will reduce costs,avoid further redundancies and avert the closure of the plant. In addition to a wage freeze until 2012, employees will lose work incentives worth 500 euros a year and forego six days of RTT. These changes must now be approved by the local works council and four trade unions. However, the CGT union is opposed to the changes and this could threaten the entire recovery plan.
16/07/2010: Flexible state pension system from 2011
From January 2011 Norway will replace its mandatory state retirement age of 67 with a more flexible system.
Under the new scheme, entitlement to a retirement pension will start at the age of 62, but individuals may choose to postpone it until the age 75, with an option to start drawing pension whilst continuing to work.
The Commission which is advising the government on the new scheme has proposed that pension laws governing occupational defined contribution (DC) and defined benefit (DB) pensions should also be amended to permit a similar level of flexibility. To allow pension trustees and managers to adapt to the changes they have recommended that such schemes should be allowed to operate under current rules until June 2011.
Meanwhile, the Labour and Welfare Service (NAV) has written to those aged 62-67 advising them that they must give notice by August 1st if they wish to draw their state pension from January 1st next year.
14/07/2010: Decline in use of flexible working hours
The number of workers in Denmark operating on a flexitime basis fell by an average of 6.4% between 2007 and 2009. The biggest falls were amongst men (-8.9%) and those aged 15-29 (-13.2%). The sectors most affected were manufacturing and construction (-14.3%), trade and transport (-16.2%) and real estate (-30.8%).
13/07/2010: Launch of controversial pensions bill
Today the French government is expected to adopt the long- awaited Bill to raise the minimum state retirement aged from 60 to 62 by 2018 and bring public sector pension rules into line with the private sector. Once adopted, the Bill will be scheduled for debate by the National Assembly (parliament ) in September 2010.
12/07/2010: Tighter enforcement of minimum employment terms
Increased powers are to be given to the Dutch Labour Inspectorate to take over the administration of a company if they discover that an employer is contravening minimum pay or vacation requirements. Currently such powers only exist where an employer is found to be employing illegal immigrants.
09/07/2010: Combating pensions inequality
France's High Authority against Discrimination and for Equality (HALDE) has established a committee to advise the government on ways to improve pensions for women. Currently 76% of the beneficiaries of the minimum pension are women and their average pension is almost 40% less than that received by men.
08/07/2010: New limits on bonus payments and severance packages
The European Parliament has voted in favour of amendments to the Capital Requirements Directive that place strict limits on bonus payments in the financial sector.
Under the proposal employees in local and foreign-owned banks and hedge-funds will only be able to be paid 30% of their bonus payments at the end of the year when they were earned (20% in the case of large bonuses). The remaining payments will be conditional on the achievement of longer term results. Half of the total bonus will be paid in the form of "contingent capital" (that can be clawed-back if the institution runs into trouble), with an option for conversion to shares. Moreover, at least 40% of cash bonuses (60% for larger bonuses) would have to be deferred for between three and five years. If bonuses are paid in the form of pension benefits they will have to be held initially as a corporate asset for a minimum of five years.
Limits will also be placed on the payment of golden handshakes for departing executives.
The amendments are expected to be endorsed by EU finance ministers next week, with the curbs taking effect on January 1st 2011.
06/07/2010: Reintroduction of progressive income tax bands
The Bulgarian President, Georgi Purvanov, has confirmed that following recent discussions with the European Commission and the Confederation of Independent Trade Unions of Bulgaria (CITUB) his government is exploring ways to re-introduce progressive income tax bands to replace the current 10% flat-tax system. Any change would, however, ensure that the poorest households were free of any income tax burden.
05/07/2010: Employers not relaxing disciplinary procedures
An article in Portugal's leading financial newspaper Economia claims that labour reforms that were introduced eighteen months ago to make it easier to dismiss workers are not, in practice, being applied by employers.
Whilst employers must still have "just cause" for dismissal there is now no obligation upon them to go through lengthy disciplinary procedures, including the hearing of witness statements in an employee's defence. The reason for this reluctance to embrace the reforms, according to Economia, is the fact that an employee may still apply to a court within 60 days to determine if the dismissal was justified.
04/07/2010: No workplace temperature limit set by the law
According to the German Federal Labour Court there is no statutory temperature level that workplaces must not exceed. A guideline (ASR-6) specifies an upper temperature limit of 26 degrees centigrade, but according to Section 618 of the Civil Code, an employer is only obliged to operate a workplace that does not endanger the life and health of workers. In the court's view this can be generally achieved by installing "window blinds, providing cool drinks, starting work earlier or arranging longer breaks". It is therefore up to those with a health complaint to obtain a medical certificate specifying that they must not work above a specific temperature.
01/07/2010: Executive healthcare costs likely to tumble
The Czech government coalition partners have agreed a number of sweeping changes to the health system that will reduce the cost of private medical insurance. Under the proposals patients will receive basic medical care through the state system, but if they wish to receive additional or higher quality items, such as an above standard hip replacement joint, then all they will be responsible for will be the difference in cost compared with the standard treatment.
The coalition's negotiators have also agreed that a GP or specialist will be available within a maximum distance from where each citizen lives and that an appointment will be available within a specified time. Where they could not gain agreement, however, was on the removal of prescription charges - largely because there was no common ground on how to replace the lost revenue if prescriptions charges were phased out altogether.
27/06/2010: Competing collective bargaining units could become the norm
Germany's Federal Labour Court has issued a ruling that ends decades of monopolistic rights to union representation and collective bargaining in German companies. The court's decision will mean that duplication and overlapping collective bargaining units may operate concurrently. It also undermines the practice of extending in-house wage deals made between a company and the union with the greatest representation to cover all workers in the same company who are performing similar jobs.[23rd June 2010 - 10 AS 2/10 & 10 AS 3/10].
27/06/2010: Referendum to be held on Labour Act amendment
Widescale opposition has arisen in Croatia to a proposed amendment to the Labour Act that would eliminate collective agreements if they are not renewed within six months of their formal expiry date. Trade unions have collected over 700,000 signatures in opposition to the draft law - well in excess of the number required to force a referendum to be held on the issue.
26/06/2010: Redundancy procedures in international companies
A new law (no L 2010-499) has come into force in France to protect employees under the threat of redundancy in international companies. If an 'at risk' employee cannot be found an alternative position in France they must give their agreement before being offered a position in another country. Normally a new position must be offered at the same pay as that received in their current position and within the same job category and seniority level. If this is not possible, then a position at a lower level may be offered only following further consultations with the employee concerned and after gaining their written consent to such an offer. Once an offer is made an employee will have six working days to respond to it.
24/06/2010: Retirement age to rise by two years from 2018
The French government has launched its much awaited reform package. The Bill to be debated by the National Assembly(parliament) early this Autumn includes the following elements:
* The minimum pensionable age will be raised from 60 to 62 by 2018 and the mandatory retirement age from 65 to 67 by 2023.
* Early retirement will be only possible if an employee has been undertaking arduous work, or they have a disability due to illness or accident.
* Employees will, in future, require an occupational medical health record which sets out areas of exposure to harmful substances and specifies any limitations on the jobs that may be performed.
* Workers aged 55 or over hired by companies for at least six months will be exempt from social secutity contributions.
* Companies with 300+ employees that fail to report each year on their current position on equal pay between women and men will be subject to a fine equal to 1% of their payroll.
To monitor the implementation of pension reforms a "steering committee" will be formed involving representation from both sides of industry. This will prepare a report to be presented to the National Assembly by March 31st 2018.
24/06/2010: New limit to be set on holiday carryover
The Dutch government has adopted a Bill drawn up by Social Affairs Minister Piet Hein Donner to further limit the period during which annual statutory vacation days can be saved. The Bill would reduce the time during which unused holidays can be accumulated from the present limit of five years to just eighteen months. This measure would not, however, affect an employee's right to save up contractual holidays offered in excess of the statutory minimum - if such a facility is agreed with their employer.
22/06/2010: Major improvements to Czech Labour Code
The Czech coalition government has drawn up a number of employer-friendly amendments to the Labour Code. These include a facility to hire employees on fixed-term contracts of any duration, a reduction in severance pay for new employees and an improved incentive to employ casual workers.
Under the proposals employees with less than one year's service would be entitled to only one month's compensation, whilst those with one to two years' service would receive two months compensation. Only after a minimum of two years would an employee be entitled to severance amounting to three months salary.
The government also wants to reduce the costs of employing casual workers for short periods during the year - such as seasonal work.The current exemption from employer and employee social security contributions for such workers would therefore be raised from a total of 150 hours to 300 hours of employment per year.
18/06/2010: Government rushes through labour reforms
The Spanish government has finally introduced its promised tranche of Labour reforms. This simplifies employment contracts, reduces severance payments (in some cases) to 25 days per year of service, and makes it easier for companies to establish short-time working arrangements.
A new Wage Guarantee Fund (Fogasa) is to be established to reduce the burden of severance costs to individual companies. This will top up severance payments by up to eight days per year of service.
Spain's two big unions - The UGT and CCOO - have announced that they will hold a general strike to protest against the reforms. This will not, however, take place until September 29th - an indication perhaps that they may have doubts about their ability to command widespread support at a time when unemployment is standing at 20% of the working population.
16/06/2010: Strong demand for temporary workers in industrial sector
Over the year to May 2010 the total hours worked in the Dutch temporary work sector grew by 9%. According to the Dutch Association of Temporary Work Agencies (ABU) growth was particularly strong in the industrial sector, with hours worked up by 26% compared with the same period last year.
11/06/2010: Rapid growth predicted for next six months
The latest economic forecast by the Organisation for Economic Cooperation and Development (OECD) based on its 'longer leading indicators' suggests that Europe remains set for a rapid upturn during the second half of this year. It is likely, however, that the rate of expansion will slow during the first half of next year, particularly in France and Italy.
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