By IPS Correspondents
MADRID, Mar 2 2001 (IPS)

The Spanish government imposed an employment law Friday by decree, announcing that it will favour job creation, though it was met by strong protests from labour unions, which are now threatening a general strike.

The emergency decree by the José María Aznar government, of the centre-right Popular Party (PP), establishes – among other things – improved layoff compensation for temporary work contracts.

Spain’s two largest trade unions, the communist-leaning Workers Commissions (CCOO) and the General Union of Workers (UGT), allied with the socialist movement, blamed the government and employers for the failure of negotiations that were meant to renew an accord signed in 1997, and which expires in May.

The unions’ position is that the government measure stimulates the creation of temporary jobs, which already predominate in the employment of young people, to the detriment of the fixed-term contracts that insure wage stability.

Temporary work, they maintain, also makes it difficult for workers to rent an apartment or buy on credit, because the unknown duration of the job prevents them from providing a guarantee of their income.

Under law, contracts must be predetermined and temporary positions must only be used in urgent situations, explain the unionists.

A CCOO representative told IPS that some young workers have held as many as 10 temporary contracts in one month, through employment agencies or other service enterprises.

Currently in Spain, 70 percent of young employees – under 30 – are working with temporary or tentative contracts, while for the 16-19 age group the proportion reaches 84 percent.

The eight-month dialogue between the government, the CCOO and UGT, and delegates from the Spanish Confederation of Business Organisations (CEOE) and from the Confederation of Small and Medium Companies, ground to a halt Thursday after Aznar and two of his ministers indicated that the deadline for an agreement had expired.

Aznar had warned that if no accord was reached by the representatives involved by the end of the day, the Council of Ministers would approve the labour reform on Friday.

The decree must now go through the Spanish Congress, but its approval is seen as a given because Aznar’s PP holds the majority.

The new law indicates that temporary contracts will now provide unemployment compensation equivalent to eight days’ salary for every year worked under that contract.

In the traditional contracts of undetermined duration, the compensation is 45 days of wages for every year worked.

In contrast, under this same type of labour agreement, but which is part of a government job creation programme, the indemnity is 33 days of wages for each year worked, though it so far only applies to employees over age 30.

The new regulation establishes that this benefit would now apply to workers 16 to 30 years old, unemployed women, and those who have been unemployed for more than six months who are covered by a protected contract under the job creation plans.

The approval of the decree contradicts one of Aznar’s electoral campaign promises that had been confirmed by his spokesman, Joseph Piqué, who stated that the government was not going “to impose any reform of the labour market that did not have minimum consensus of social leaders.”

But while the syndicates accuse Aznar of not keeping his promises, employers blame the labour unions for the failure of the negotiations.

In response, UGT secretary-general Cándido Méndez said that though “the rupture formally occurred as a result of a CEOE initiative, it was precipitated by the declarations made Thursday by (Labour) minister José Aparicio and (Vice-President Rodrigo) Rato.”

For its part, the CEOE called the stance of the unions “incomprehensible,” because “the previous labour reform (of 1997) has resulted in the net creation of more than two million jobs, 80 percent of which were for an unspecified duration.”

CCOO secretary-general, José María Fidalgo, said “if there had been any possibility of an agreement we would have stayed there the entire night working towards it.”

“But the business owners have been reluctant and very stubborn in accepting measures that limit temporary hiring, and our counterparts say it is not enough,” he explained.

Méndez stated that the employers’ organisations only want to pull a commitment out of the workers’ unions to be able to deregulate part-time contracts.

Government spokesman Pío Cabanillas, meanwhile, lamented the fact that the three-party discussions had only achieved agreement on 80 percent of the matters on the agenda.

Cabanillas commented that it was “impossible to finish the hand, which forced the government to impose the decree – in the interest of the citizens.”

Excerpt: