Opposing views by employers and unions on what the new labor bill should look like dominated the talks at the social economic council (GSV) meeting on Monday, state agency Hina said.

According to Hina, employers pushed for more flexibility of labor legislation, whereas union leaders called for less.

Employers pointed to what they called chronic labor shortage, while unions, as usual, blamed employers for “their unwillingness to resolve labor rights through collective agreements,” Hina said.

Irena Weber of the national association of employers HUP said in a news conference after the meeting that they are faced with a huge problem of labor shortages “on a daily basis” due to the exodus of young workers and what she called the “negative demographic situation” affecting the labour market.

“Young people are emigrating to countries with more flexible labour legislation and HUP has long claimed that rigid labor legislation does not contribute to protecting jobs and employees, on the contrary,” Weber said, adding that “it is flexible labor legislation that helps create jobs, and spurs education, advancement for employees, and increase in their living standards.”

HUP also calls for lower labor taxes, which they say is extreme in Croatia, Weber said. “The average tax burden on labor costs is 42 percent, which makes it virtually impossible to see any significant salary increases,” she said. HUP proposes increasing the non-taxable portion of income from 4,000 (€532) to 5,000 (€665) and cutting income tax rate from 20 percent to 15 percent.

Weber said that their demands for more flexibility do not translate into easier dismissal of workers, because “that issue is not relevant at a time when there is a shortage of workers in all sectors,” she said.

The economic social council discussed the new labor bill which the government had sent to parliament last week. The existing law needs to change due to two EU directives, “one of them is about transparent and predictable working conditions and the other is the EU Work-life Balance Directive.”

Hina did not explain what those directives actually require.

Weber said that the draft bill does not help modernize the labor market, and she pointed out the discrimination against some employees when unionized workers are given legally mandated preference over non-unionized employees.

“We do not intend to pay out Christmas bonuses and rewards depending on whether somebody is a member of a union or not, and we will correct this injustice,” she said.

Union leader Kresimir Sever said that today’s meeting “did not bring anything new in terms of positions,” adding that they all expected a continuation of the dialogue between the first and second parliament readings on the draft bill.

Contrary to the position of HUP, Sever blamed the “overly flexible” law which, he said, “encourages emigration.”

The unions, on the other hand, are calling for less flexibility, because “very few labor rights are resolved through collective bargaining agreements in Croatia.”

“Croatia is still not ready to increase the flexibility of labor legislation because it is necessary to provide workers with some form of protection that should be guaranteed to them in the future, through some kind of collective bargaining. It is clear that the coverage with collective agreements in Croatia is below 50 percent, and we still have a lot of work to do,” he said.

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