Law Would Protect Employment
During Crisis
The Unión Costarricense de Cámaras y Asociaciones de la Empresa
Privada (Uccaep) confirmed that some 15.000 people lost their jobs
last December, while another 5.000 found themselves without work
last month.
Eugenion Solano, vice-minister of the ministerio de Trabajo (Labout
Ministry) report that on average 250 people daily seek out advice on
severance pay.
The majority of those seeking the ministry's advice tell stories of
how dumbfounded they were when told when their jobs were at an end,
in the majority of the cases the financial crisis being the reason
for the layoff.
At the end of the month another 200 employees of the Sylvania plant
in Pavas will join the unemployment line, as the company announced
last week that it would be closing one of its two plants due to
decrease in sales worldwide for their products.
Across the street to Sylvania is Merck Sharp & Dome who also
announced earlier this month the closing of operations in Costa
Rica. The MSD plant will be closed by the end of the year as the
company restructures. Company officials say the closure is not
related to the crisis.
Econmists for the Universidad Nacional (UNA) say that during the
second half of 2008 the shrinking economy has meant a loss of the
formal job market to generate employment.
Isaac Castro, head economist for Interbolsa, is even more negative,
saying that unemployment will increase during the coming months, as
the worst of the crisis is yet to come.
To face the situation, the Uccaep has drafter a legislative bill
called "Ley de protección del empleo en momentos de crisis" (Law
protecting employment in times of crisis), which is expected to be
presented to the Legislative Assembly in the coming days.
The Uccaep plan proposes temporary changes to the Código de Trabajo
(Labour Code) that would allow employers to adopt "special measures"
in an effort to avoid firings.
Some of the measures include employers the ability to cut work days
and offer their employees earlier vacation periods, as well as
reduce salaries of high level executives and make changes to the
"legal work day" that currently protects employees.
Marco Durante, a specialist in labour law and who participated in
drafting the bill, says that employees who do not accept the
measures can be fired, with severance.
"This is not ordinary law, nor for normal times, it is only for a
time of crisis", said Durante.
The measures proposed in the Uccaep draft were part of the measures
announced by Costa Rican president, Oscar Arias, in his "Plan
Escudo", a government proposal to combat the crisis.
Both the Uccaep and government proposal required Legislative
approval before it can take effect.
Legislators are concerned that the changes may become permanent and
adversely affect workers and their rights, though for the time being
are being supportive of the initiatives.
The Uccaep assures that the plan is completely temporary, for not
longer than six months and will take effect following the issuing of
an executive order by the government following a declaration by the
Banco Central (Central Bank) that the country is in a financial
crisis.
President Arias said yesterday that he was not aware of the Uccaep
proposal, but would be fully supportive of the measures that would
protect employment during these tough times. |
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