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Cyprus

Harsher penalties on the way for worker exploitation

Labour Minister Zeta Emilianidou (Christos Theodorides)

The labour ministry is preparing new legislation laying down heftier fines on employers who exploit their workers, as well as cracking down on undeclared work, minister Zeta Emilianidou revealed on Monday.

She was speaking to MPs during a discussion of the labour ministry’s budget for 2017.

The minister said an “umbrella law” is being prepared dealing with all matters relating to workers’ rights, including minimum salary, work hours and overtime pay.

The new legislation provides for an administrative fine of €3,500 for each violation of a worker’s rights by an employer.

Currently the law provides for a €300 fine and as such is not prohibitive.

At the same time, Emilianidou said, the ‘social dialogue’ has been completed on a new bill that aims to stamp out undeclared work.

The bill, currently being vetted by the attorney-general’s office, is expected to be submitted to parliament soon.

“Undeclared work is one of the biggest problems we have faced in Cyprus for years. We are changing our whole policy toward undeclared work,” Emilianidou told lawmakers.

A ‘risk assessment’ system would be put in place to evaluate the probability of undeclared workers at businesses.

“If a hotel with 100 rooms has 10 maids, then it is obvious there is an issue with undeclared work,” the minister said by way of example.

Violators would be fined. And where cheating on social security contributions is established, the law will mandate the retroactive payment of up to six months’ worth of social security payments.

The ministry’s budget for 2017 comes to €946 million, compared to €926 million this year and €912 in 2015.

Over 93 per cent of the 2017 budget has been allocated to social benefits, said Emilianidou, with 5 per cent going to salaries and two per cent to operating expenses.

On Guaranteed Minimum Income (GMI), the minister said the first and second phases of the programme have been completed.

Currently, some 55,000 people are eligible for GMI.

According to Emilianidou, around 13,000 families who received no financial assistance from the state prior to the introduction of GMI, now do via this programme.

She noted that the criteria for GMI eligibility differ from those applicable for public assistance.

To be eligible for GMI, people must be Cypriot citizens over 28. They must not have over €5,000 in the bank or own property worth more than €100,000 – excluding primary residences.

The minister said that currently some €220 million is spent on GMI, compared to €160 million spent on public assistance in 2013.

GMI was introduced in 2014, replacing the previous system of public assistance allowance.

 

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