New Spain PM pushes for labour reform

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Spain's incoming conservative prime minister pushed for "urgent" labour reforms within weeks to lower unemployment and strengthen the stalled economy, his party said on Wednesday.

Labour reforms are a crucial part of the agenda of Mariano Rajoy, who is under pressure to stabilise Spain's finances and rescue it from the eurozone debt crisis when he takes office as prime minister in December.

He held meetings Wednesday with the leaders of major unions and business associations, urging them to work together so that reforms can be drawn up by the second week of January.

Rajoy "expressed to his interlocutors his commitment to undertake urgently a labour reform to contribute to getting Spain back on the path of job creation", his conservative Popular Party said in a statement.

The reform will cover issues such as collective bargaining, hiring laws, absenteeism, employment dispute settlements, temporary work agencies and training.

"He listened to the opinions of the union and business representatives on these issues and encouraged them to reach agreements before the second week of January," the party said.

The head of the CEOE main business lobby, Juan Rosell, said after meeting with Rajoy: "We broached the topic of labour reform, of how we can modernise a labour law that is very outdated and difficult to understand."

Rajoy also met with the leader of another business association, CEPYME, and the labour unions CCOO and UGT.

Spain's outgoing Socialist government last year launched a reform that included changes to the dual system of long-term and short-term work contracts but economists have said deeper reforms are needed.

UGT leader Candido Mendez said after meeting with Rajoy that more labour reforms were not the way to lower unemployment, which is at 21.5 percent, the highest rate in the industrialised world.

Rajoy is "confusing the issue of solving the unemployment problem with an umpteenth labour reform", Mendez told reporters, adding that he did not feel "pressured" by Rajoy's urgency to hit a deal in January.

Rosell said: "If there is no agreement, the government is there to decide and do what it thinks fit," however.

"The situation is urgent... the future of our country is at stake."

© 2011 AFP

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