September 19, 2018 / 4:58 PM / a month ago

Greece wants to speed up minimum wage rise after bailout exit

ATHENS (Reuters) - Greece on Wednesday submitted a draft amendment to parliament to speed up the process of raising the minimum wage for the first time since 2009 when a national debt crisis erupted.

FILE PHOTO: Greek Prime Minister Alexis Tsipras arrives for the informal meeting of European Union leaders ahead of the EU summit, in Salzburg, Austria, September 19, 2018. REUTERS/Leonhard Foeger

The move comes a month after Greece emerged from its third international bailout.

It is a priority for the left-led government of Prime Minister Alexis Tsipras, which in 2015 signed up to a new bailout despite its pre-election pledges to end austerity and increase wages.

The minimum wage was slashed by up to 32 percent to about 500 euros during the crisis as part of measures prescribed by the country’s lenders to make the labor market more flexible and the economy more competitive.

The increase to the minimum wage will be concluded by January 2019, following consultations between employers, unions and the government, according to the draft law.

Greece had told its European lenders that it would reinstate the minimum wage process after the end of the bailout.

Under Greek law, the consultations should take place in the first six months of the year, which was not possible in 2018, since the country was still under bailout supervision until August, the ministry said.

It added that “the immediate activation of the relevant process is imperative” and the minimum wage should reflect the country’s economic improvement.

Earlier this month, Labour Minister Effie Achtsioglou approved the extension of collective wage agreements in several sectors, including tourism, effectively reinstating collective bargaining.

Tsipras’ term ends next year and his Syriza party is lagging behind the main conservative opposition in opinion polls.

He has promised to reward the public for the pain suffered during the crisis by scrapping legislated cutbacks which he calls unnecessary and undoing reforms that hurt labor rights.

But the International Monetary Fund has warned that reversing labor reforms would weigh on the recovery of private sector investment and job creation, at a crucial moment for the country which is struggling to regain investors’ trust.

Labour ministry agencies have also stepped up inspections on businesses for any labor law and workers’ rights violations.

Reporting by Renee Maltezou

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