Spain: Labour market reforms now permanent

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The Spanish government has given the green light to labour market reforms designed to help make it cheaper and easier for employers to reduce their headcount. At present, full-time employees on permanent contracts are entitled to 45 days of pay for each year worked if they are made redundant. This will now be reduced to 33 days.

The reforms were initially introduced as an emergency measure in June and have now been made permanent.

Reformers such as the International Monetary Fund believe that such a move is essential to reduce the rate of unemployment in Spain, which currently stands at 20% and is the highest in the Eurozone. On the other hand, Trade Unions have called a General strike for 29 September to protest against this and other austerity measures already in place, which include pay cuts of 5% or more for civil servants.