Government in Athens under pressure to introduce a six-day working week as part of the terms for a second bailout

Ian Traynor in Brussels
guardian.co.uk, Tuesday 4 September 2012

Greece's eurozone creditors are demanding that the government in Athens introduce a six-day working week as part of the stiff terms for the country's second bailout.

The demand is contained in a leaked letter from the "troika" of the country's lenders, the European commission, European Central Bank, and International Monetary Fund. In the letter, the officials policing Greece's compliance with the austerity package imposed in return for the bailout insist on radical labour market reforms, from minimum wages to overtime limits to flexible working hours, that are likely to worsen the standoff between the government and organised labour in Greece.

After a long delay caused by months of political paralysis in Greece, the troika inspectors return to Athens this week to scrutinise Greek observance of its bailout terms. They are expected to deliver a verdict next month that will determine whether Greece is ultimately allowed to remain in the single currency.

The letter, sent last week to the Greek finance and labour ministries, orders the government to extend the working week into the weekend.

"Measure: increase flexibility of work schedules: increase the number of maximum workdays to six days per week for all sectors.

"Increase flexibility of work schedules; set the minimum daily rest to 11 hours; delink the working hours of employees from the opening hours of the establishment; eliminate restrictions on minimum/maximum time between morning and afternoon shifts; allow the consecutive two-week leave to be taken anytime during the year in seasonal sectors."

The instructions focus on labour market reforms, calling for the national labour inspectorate to be radically reformed and put under European supervision.

The letter reveals the detail of eurozone intrusion into a national system and culture of work widely seen outside Greece as dysfunctional.

There should be a permanent "single-rate statutory minimum wage", seen as an incentive for getting people back to work in a country where unemployment has soared to around 30%.

"Unemployment is too high, and policies are needed to prevent it from becoming structural," the letter says.

The letter also calls for non-wage labour costs to be lowered, employers' welfare contributions to be cut, and deregulation of the labour market.

There is growing conviction in Berlin and Brussels that the government of Antonis Samaras in Athens has fallen well behind in the economic and fiscal reform programmes imposed in return for two bailouts in the past two years.

The Greek government is struggling to come up with persuasive policies to enact spending cuts of a further €11.6 bn, which were to have been implemented in June, to secure the next bailout tranche of more than €30bn due next month.

Samaras is pleading for more time – four years rather than two – to fulfil debt reduction targets and spending cuts.

Extending the deadlines would effectively require more eurozone help and a third bailout. There is little appetite for more rescue funds across the eurozone, meaning that Greece may ultimately be sacrificed.

Although statements on Greece in Berlin, Paris and Brussels have been more upbeat over the past fortnight, there is strong speculation in Berlin and Brussels that Greece may have to exit the euro, but not until after the US elections in November.

http://www.guardian.co.uk/business/2012/sep/04/eurozone-six-day-week-greece