Unions, business fail to agree on major labor reforms

The chances of Spain's labor and business leaders reaching a broad agreement to address the problem of soaring unemployment by the deadline set by the government are looking increasing remote.

A meeting on Monday between the head of the CCOO union, Ignacio Fernández Toxo, and his counterpart in the UGT labor organization, Cándido Méndez, with Juan Rosell, the chairman of the CEOE, the country's largest employer group, failed to breach major differences between the two sides in areas such as wage moderation, collective bargaining and layoffs.

The three are due to meet again on Tuesday, but the growing pessimism about reaching an accord by the Friday deadline set by the new Popular Party government among the participants in the meeting was palpable.

There is a growing likelihood that unions and business will restrict themselves to presenting areas in which there is an agreement and leaving it up to the government to push ahead with the most painful reforms.

In the area of wage caps, the CEOE wants a freeze for this year and the next and is only prepared to concede a slight increase in 2014 if the economy has picked up. The unions, however, want hikes for both this year and the next, albeit below the rate of inflation, and want workers to recover purchasing power in 2014.