Greek Cabinet Approved Mass Layoff of Civil Servants

In a Sunday session, the Greek cabinet has approved a first round of massive layoffs of its civil servants. These layoffs are one of the ways that the struggling nation is attempting to deal with its massive debt crisis. This move in unusual because under the Greek Constitution civil servants are guaranteed a secure job for all of their lives.

In the marathon session of the cabinet, which was chaired by the Greek Prime Minister, George Papandreou, the decision to let go of some 30,000 Greek civil servants was made, though the break will not be a completely clean one. By the end of the 2011 fiscal year the displaced civil servants will be put on a partial pay program that will allow them to receive 60 percent of their current wages for one calendar year. After that year the former state employees will be made redundant. This provides a bit of a safety net to the large amount of workers who are being let go and prevents the Greek safety net from being overwhelmed by the influx of new applicants.

This set of cuts is likely to be only the first in several rounds of cuts made by the Greek government. While all of the cuts may not be related to government employees, more cuts are expected in the near future. The country is expected to make more staff reductions between now and the next two years. These cuts are designed to help the country to not only cut its spending in the long term but to make good on the promises that the nation made regarding the fiscal and development goals agreed upon with EU/IMF lenders, who gave the company the money it needed to stay afloat, in 2010. If Greece does not meet its targets it does not receive the needed aid. This plan is part of a three-year austerity and reform plan that is designed to slash the Greek deficit and restore their economy to a stable state.

A statement made by the Greek government spokesman Elias Mossialos after the Sunday session made the following statement. “The government opted for the option with the milder possible social impact that still meets in full our commitments to foreign lenders.”

The same statement was quick to stress two other key points about the layoff. The first being that this will allow Greece to save about 300 million Euros (or about 401.64 million U.S. dollars) in its budget each year. The second point of note is that all of the 30,000 employees to be laid off will be more than 60 years old.

Elias Mossialos put that news this way, “the labor reserve will not lead to the insecurity of unemployment, but the security of pension.”

The layoffs were not approved without any opposition. On Sunday protestors stood outside the parliament while it was in session and the countries labor unions have called for a nationwide general strike on Oct. 5. No news has been released on how many people are actually expected to participate in the planned strike.