Labor union bows to employers on contract juggle

The secretary general of the UGT labor union, Cándido Méndez, on Wednesday expressed his willingness to accept the conversion of full-time working contracts into part-time substitutes in order to push through an agreement with employers' groups to kick-start a recovery in employment.

However, Méndez warned that the move must carry conditions - it will only apply to small and midsized companies and can be reversed when the economic situation improves - and only be introduced as an alternative to layoffs. He also said the UGT would back salary controls to ensure that wages grow below the level of inflation. Méndez was at pains to point out that the UGT is seeking "agile mechanisms for alternatives to layoffs." His words were offered a rare glimpse of hope that employers and unions could reach an accord on labor reform.

The other sticking point, salary increases, was also discussed. The main employers' group, the CEOE, wants "an extremely moderate increase" but Méndez said the flexibility of the UGT and CCOO unions had its limits. The magic figure appears to be in the region of one percent. If the CEOE insists on a salary freeze, Méndez warned, there will be no agreement.

The Popular Party government has given employers' groups and the labor unions until week's end to reach their own pact, before stepping in itself.