The deal, reducing payroll cost by roughly 15%, will be presented to general meetings of employees’ unions for ratification. The agreement excludes the employees of the Co-Op Central Bank (CCB) as they are members of commercial bank employees’ union ETYK. Initial reports of the terms include a drop in the employer’s contribution to the provident fund benefit from 12% to 5.0% and a 3.0% wage cut across the board with additional salary-tiered cuts.

Elisseos Michail, an official with the SEK union – of which roughly 65% of all co-op employees are members – confirmed the existence of the preliminary agreement and said that ratification was expected at the employee general assemblies. “The agreement includes cuts in wages and benefits as well as the introduction of a voluntary redundancy scheme so no one is forcibly laid off,” Michail said. “It should be noted that the agreed cuts for co-op employees are lower than those of either public servants or semi-government organisation employees.”

Co-op employees have received their annual wage increment for 2013, in contrast with commercial bank and CCB employees whose increment has been deferred as part of the cutbacks in labour cost in the banking sector. The co-op institutions are under government control since September 2013 when they were bailed out and taken over using €1.5 billion of the €10 billion troika bail-out package for Cyprus.

With the exception of the Bank of Cyprus, where payroll cost has shrunk by 10% and 24% of staff made use of the voluntary redundancy scheme offered as part of the bank’s restructuring. No wage-reduction deal has been reached regarding commercial banks yet as talks with employees’ union ETYK have broken down and are not expected to resume, pending mediation by the labour ministry.

Source: Cyprus Mail