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Dramatic increase in illegal employment

30 July 2013 / 17:07:16  GRReporter
3766 reads

Victoria Mindova

The Ministry of Labour and Social Security informs of an alarming increase in the rate of illegal employment in the first half of this year. The data of the official inspection authorities indicate that a quarter of the employees in Greece worked without social security and pension insurance in 2010 whereas in 2011, one out of three employees worked without insurance. They accounted for 36.2% of the labour force in 2012 and for 38.4% in the first half of this year.

The observers of the local labour market note that the employers are taking advantage of the difficult economic situation and of the high unemployment rate which, according to the latest data of the National Statistical Service of Greece ELSTAT, is 27%. The employers are forcing the employees to accept unfavourable working conditions in order for them to not be replaced by others who will not be opposed to working without insurance. The sectors of tourism, catering, agriculture, construction and night entertainment centres have most often failed to observe the law.

One of the most striking cases detected by the inspecting authorities this year involves a big nightclub on the island of Crete, in which only 2 of its 51 employees have been insured. The other 49 people were working in the black economy as shown by the data presented by Vassilis Kondoyiannis,  head of the economic police.

More than six thousand inspections were carried out in the first half of 2013 and the fines imposed amounted to eight million euro. Despite the intensified inspections, the work in the black economy is not decreasing. By comparison, over 4.5 thousand inspections had been carried out during the first half of 2012 and the penalties imposed had amounted to 5.6 million euro.

In order for the Ministry to cope with the rampant illegality in the labour market, it has decided to strengthen the control and to increase the fines from this summer onwards. If the offenders accept the penalty charge, they will be entitled to a 40% discount on the fine.

As of 1 August this year, the General Labour Inspectorate will carry out intensive inspections along with the economic police and representatives of the social service IKA.

"We join forces to deal with any type of violation in the labour market, including the employment of illegal immigrants," said Minister of Employment Yiannis Vroutsis. The Ministry states that 28 companies have been closed in recent months as the authorities have established that uninsured illegal immigrants had been working there.

So far, the inspection services have been operating separately and they have been unable to take action if one of them detects violations in an area which does not fall under its direct jurisdiction. For example, the economic police could not impose a penalty on a company which pays its taxes as required but does not insure the total number of its employees.

The inspecting bodies have a total of 563 people from all key supervisory institutions  and, in the following two months, they will carry out mass inspections, mainly in the tourist areas in Greece. The list of the areas includes the Ionian Islands, the Cycladic Islands, the north Aegean Sea, Crete, Halkidiki, the Peloponnese, Macedonia, Thrace and the area around Pelion. "These are examples of the areas but we will try to cover as many towns and villages as possible," said a source from the Ministry.

Vassilis Kondoyiannis of the economic police stresses that the inspections are not aimed at collecting additional funds in the state treasury. "Our main task may be checking for violations and imposing fines, but the ultimate goal is to make the employers comply with the law in the first place. When they know that an inspection can be carried out at any time, the employers will have to comply with the law and to insure their employees," he said in a conversation with GRReporter.

The issue of undeclared work in Greece is long-lasting. Although great operations of the inspection services during the summer season have been announced each year, the scale of the problem has not been mastered. After the briefing on the subject in the Ministry of Labour, the reporters joked among themselves, "Let's see what they will tell us next year - the measures have yielded results, the undeclared workers have reached 45%."

Tags: EconomyMarketsLabourIllegal employmentGreeceSummerCrisis
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