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Business Cyprus

Employers take issue with some Cola provisions

Labour Minister Zeta Emilianidou

 

Employers association OEV, said on Wednesday it accepted the labour minister’s proposal regulating the cost of living allowance (Cola) but expressed reservations over some of its provisions.

The minister proposed Cola payments, frozen following the bailout, to restart in January 2018. Cola will be added to the salary once a year, provided that the economy showed growth in the second and third quarters of the previous year.

The allowance will represent 50 per cent of the annual rise in the consumer price index, and it would be incorporated into basic salaries.

Salaries will not be reduced in the event of deflation and if conditions for its payment were not met it will be frozen and resume later from that point.

The deal, which was accepted by all parties, is for three years, pending a new agreement on the subject.

In a letter to Labour Minister Zeta Emilianidou, OEV said it accepted the “take-it-or-leave-it” proposal though it sought to stress that as a matter of principle it could not accept certain provisions: no reduction when there is deflation, and incorporating the allowance on the salaries in effect at the end of this year.

That, it said, would mean paying 65 per cent of any future allowance instead of 50 per cent, which was the target.

The proposal provides that any Cola paid to workers before the end of the year, will be incorporated on their salaries and Cola paid from January 1, 2018, will be calculated on that amount.

Sek trade union described the minister’s proposal as balanced and consensual.

“It secures workers to a great extent, contributing to the preservation of labour peace,” the union said. “The Cola institution is preserved … as is the prospect of further regulation on the basis of the wider philosophy that governs the institution.”

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