TO DESCRIBE the compensation demands of the unions for the 900 Cyprus Cooperative Bank (CCB) that will be made jobless as outrageous, would be an understatement. What the unions are demanding is tantamount to theft and the government would be an accomplice if it agreed to the compensation demands, for workers that are in effect redundant.
To get around the law and prevent charges of unequal treatment by the law, the unions have insisted that a voluntary retirement scheme should be put in place and that it should be made attractive enough so that workers under the age of 45 would take it. The reason is that in a voluntary retirement scheme, the unions negotiate the compensation and the state would not be able to pay the redundancy package stipulated by law, which is based on years of service and has a ceiling below €40,000.
It seems only the private sector follows the law. The public sector and banks have different rules for their pampered workers because politicians and bankers are terrified of the unions, hence the economically irrational voluntary retirement scheme. This scheme deprives employers of any say on which employees they would keep and they usually end up with the least productive, who know they would not be able to find another job. Conscientious, productive workers would take the ultra-generous compensation package knowing they would not be without a job for long.
The unions are demanding five years’ salaries as compensation with €100,000 as the minimum and €200,000 as the maximum and for all the workers to be eligible. As we said, the employer will not have the right to choose the worker he would keep, but would have to accept those not opting for voluntary retirement. The self-righteous unions must inform us, under which law of the Republic or collective agreement, redundant workers are entitled to five years’ salaries as compensation? There is no such law so on what grounds will the government justify this theft?
If the average compensation per worker is €150,000 the total cost to the taxpayer of getting rid of 900 CCB workers would be €135 million. There is no moral, economic or political justification for this waste of the taxpayer’s money, especially after the state has wasted a staggering €5 billion in its unsuccessful effort to keep the CCB afloat. What bankrupt company pays its workers five years’ salaries as compensation? A state-owned company run by a government unwilling to enforce the law because it is afraid of the union reaction.
Obeying union diktats, which are outside the law is another form of corruption. If we had rule of law, the CCB would have laid off 900 workers, that would receive the compensation they were entitled to by law from the state redundancy fund, plus a couple of months’ salaries as notice. But in Cyprus some workers are more equal than others.