Labour reform or greed’s voracious and unfair irrationality

Joan Carles Gallego's picture
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The much announced labour reform, which breaks the labour relation rules of the game, has invaded (via the use of political power) the natural framework of conflict resolution in the corporate and labour world between businessmen and workers, between business-owner associations and trade unions. Everything is an attack on democratic proceedings: it neither respects information and previous consultation rights with representative unions, which is guaranteed by law in relation to social policy issues (as is also done in Europe), nor the urgent need that the Constitution requires to legislate via decrees. The reform is a new and unbalanced labour rule, which opts for a clear strengthening of business-owner’s unilateral power and weakening of workers and their organisational tools.

It is clearly a useless reform to create jobs, the country’s main problem. No labour measure will create jobs if the economy is not reactivated, and the solution is not in the labour market but in the financial system, in the fiscal system, and in a change of the production model. Not only will the reform not create jobs but it facilitates their destruction (it increases the causes, it facilitates the proceedings and it reduces the lay off costs). And it is an unfair reform as:

- it eliminates worker rights, guarantees and protection (it eliminates the administrative authorisation of adjustment plans, new contracts with the possibility of rescission during the first year without any compensation, worse conditions for temporary contracts, etc.);

- it increases business-owner discretion to modify the working conditions and even to fire (more causes and more facilities for not-implementing the collective agreement);

- it dismisses the value of social dialogue and collective negotiation; and,

- it aims to weaken the power of worker representation organisations and their capacity to intervene to defend their interests in the negotiation process and protect their rights.

This reform aims to please financial markets, the EU, Merkel, the more reactionary sectors of the Spanish and Catalan business community, and the more conservative and ultra-liberal sectors of politics. But it is not a reform that is useful for a country with more than 5 million people without a job (775,000 in Catalonia). The country’s problems are for other reasons:

- insufficient fiscal revenue derived from low fiscal pressure and high-levels of fraud, compared to the rest of Europe;

- a financial system that has the economic system’s cash-flow blocked for the high level of real estate asset immobility that cannot generate revenue;

- an unbalanced production structure, excessively atomised, not innovative enough, and with a high rotation of workers;

- a low level of R&D&I, which do not foster innovation within corporations

It is here where the country’s problems are, which will not be solved by this labour reform, but which might unfortunately be worsened. In Spain there are more than 1.4 million companies. 550,000 of which have only 1 worker; 550,000 have less than 5 workers; 280,000, less than 50; and only a bit more than 2,000 companies have more than 500 workers. Taking into account this data, it is obvious that prioritising corporate collective agreements, as the reform pushes for, will not be of any use. On the contrary, the ease with which workers can be disposed of, with an increase of the causes for lay offs and a reduction of their cost, will keep the production structure incapable to train workers and foster their loyalty as the base for corporate innovation and modernisation (in a country where, the annual average contract rescission between 2002 and 2009 was more than 9 million, half of the employed population, from which 5% are lay offs).

And it is a reform that opens the door to social conflict: the direct confrontation with the Government, but especially within the companies, both in the private and the public sectors.

 

Joan Carles Gallego Herrera 

Secretary General of CCOO de Catalunya

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