The government is expected to submit a compromising proposal on the cost of living allowance (CoLA) before the end of the month, Labour Minister Yiannis Panayiotou said on Thursday.
With the proposal, the government hopes to finally ensure labour peace which will eventually help the economy’s development, after unions and employer organisations have been wrangling over the matter for months.
Panayiotou said the ministry is in constant communication with the finance ministry and social partners, as well as with the legal service.
“I am positive there will be a good result,” he told the state broadcaster without delving into details on what the compromise could be.
The government has stressed its role as mediator between employers and unions.
Public service workers and around 30 per cent of private sector employees are party to collective agreements and eligible to CoLA adjustments. Unions are demanding the gradual full restoration of CoLA while employers said they want to continue to pay 50 per cent of CoLA as had been the practice in the past five years.