Key Portugal union rejects labor reform

Key Portugal union rejects labor reform

LISBON - Reuters
Key Portugal union rejects labor reform

Thousands of protesters shout slogans during a protest against government austerity measures in Lisbon during a general strike held on Nov. 24, 2011. AFP photo

Portuguese employers and unions agreed labor market reforms yesterday to boost the economy’s competitiveness under terms of an EU/IMF bailout, but the biggest union’s absence from the deal suggests anti-austerity protests will continue and even grow.

Portugal’s CGTP union abandoned the collective bargaining talks earlier. But the reform pact will be formally signed today by another large umbrella union, the UGT.

To reach the agreement, the government had to drop a controversial proposal to increase the working day by half an hour to 8-1/2 hours. In return, unions accepted changes to labor laws such as a relaxation of curbs on firing and hiring, reductions in the number of holidays and layoff compensation.

The government has yet to propose measures to compensate for the dropped half-hour increase.
Economy Minister Alvaro Santos Pereira hailed the deal as an important signal by the debt-laden country on the euro zone’s periphery that it can overcome its crisis.

“After months of intense negotiation, the country has a deal that reinforces competitiveness in the economy and forms the basis for economic growth, preserving the foundations of social peace,” he said in televised remarks. “Portugal is showing to the world, to the markets that, once again, we are managing to overcome our differences and unite in moments of difficulty.”

Yesterday’s accord came just two days before informal consultations on reforms involving the government and international lenders from the European Commission, European Central Bank and International Monetary Fund.