Prospects for a new agreement on the Cost of Living Allowance appear bleak after Tuesday’s meeting between the Ministers of Finance and Labour and the employers’ associations. The hour and a half discussion showed the gap is widening rather than narrowing, with the atmosphere described as particularly heavy. According to Politis sources, employer groups reiterated a firm no to “CoLA for all” and strongly objected to incorporating CoLA into the national minimum wage, a key demand of the trade unions. Government circles are nevertheless considering the approach outlined earlier this week, namely that embedding CoLA in the minimum wage could be the key to a deal.
Parameters Set By Employers
Beyond that core disagreement, employers set additional parameters. They want a requirement for positive economic growth in the previous year as a precondition for CoLA payouts, a 4 percent cap on inflation, a phased move from today’s 66.7 percent coverage to 100 percent within 18 months, and tax relief to offset the additional cost to businesses.
The Solution Must Be Comprehensive
After the meeting, Philokypros Rousounides, Secretary General of the Cyprus Chamber of Commerce and Industry, said the sides discussed specific issues where some convergence might be possible and could serve as a base to build on. He added that it is too early for firm conclusions but that employers remain committed to social dialogue, which has helped resolve challenges for decades. He stressed that any solution must be comprehensive, not a la carte, and said a new joint session of the employer organisations’ executive committees is possible.
OEB: Still A Long Way To Go
Michalis Antoniou, Director General of OEB, the Employers and Industrialists Federation, said there is still distance to cover and divergences remain. Referring to today’s scheduled meeting between the ministers and the trade unions, he described the situation as fluid and uncertain and said no one can confidently predict the direction of travel. OEB’s enlarged executive committee met after the talks to review outcomes and set next steps.
The Ministers of Finance and Labour are expected to meet the unions today. A joint session of all social partners on Friday will depend on what emerges from that meeting and whether a constructive climate prevails.