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Radical changes will occur in the field of investment, in the payment system of employees in state enterprises (DEKO) and in prices because of the VAT increase.

New bill, which the ministerial council approved late yesterday, virtually eliminates collective labour agreements and introduces company contracts, enhancing employers’ position and undermining the labour rights of employees in the private sector gained so far. Private employees union GSEE immediately responded to the new bill and announced a 3-hour strike (between 12 o’clock and 3 o’clock in the afternoon) and a rally outside the Parliament at 1 o’ clock at noon on Tuesday. The civil servants trade union of ADEDY will not join them as it will go on a 24-hour strike the next day. The peak of strikes across the country is expected on Wednesday, when a general strike against the radical measures of the government, which hit the labour rights of employees in the private and public sectors, will be held.

The new provision, which shall enter into collective labour law, is related to the formulation of a new form of collective agreement - special company collective agreement – the terms of which will be determined by the social partners each year. In case this agreement is breached it is considered invalid, and if convicted the compensation for dismissal is calculated on the basis of the pay that is entered in the respective branch collective agreement. Companies with less than 50 employees will be able to sign this type of agreement.

The bill of the Finance Ministry was submitted yesterday to the financial commission at the Parliament and will quickly be sent to plenary vote in Parliament on December 14.

It is intended in the bill to revise the pay of part time employees and the contracts of employees on temporary contracts after 36 months with the same employer to become permanent on the provisions for flexible labour market and simplified labour law practice.

Major changes are expected for employees in state enterprises, which receive salaries two times higher than the private employees. A ceiling on their monthly salary of 4000 euros will be determined except for the payments for managers and administrators. According to the bill, salaries higher than 1800 euros a month will be reduced by 10% by cancelling the allowances for unhealthy work and marital status. The highest reduction of salary per employee is expected to reach 25%.

Employees of one of the largest state-owned enterprises – the Greek Railways, announced today that they will sign the collective agreement as they have done 21 years and will not agree their salaries to be reduced. They protest against the new reduction, which according to their calculations is up to 50% of the money they receive and for covering the scandal with the investment of 10 billion euros that has sunk without having completed any of the planned projects.

The bill provides for a reduction in Agricultural Bank employees salaries by 10% for salaries over 1800 euros and by eliminating the allowances for "customer service". The allowance for supporting the low-paid employees will not be cancelled.

There will be increases in electricity bills; the price of cigarettes will reach € 4, and many other products and services will be more expensive. It should be noted that there will be no changes in tax services in the new bill-"broom" as employees opposed them. The new bill includes seven major changes in taxation as the increase in VAT from 11% to 13%, reduction in VAT on medicines and hotels stays from 11% to 6.5%, simplifying the system for heating fuel transportation by cancelling the special consumption tax on fuel the suppliers pay at the customs. The consumer tax on electricity for domestic use will decrease from 5 euros / MWh to 2.2 euros / MWh, but the company's price lists will increase from 2.5 euros / MWh to 5 Euro / MWh and the tax on electricity consumption for agricultural needs will be entirely eliminated.