Truth and lies about the Work decree and fixed-term contracts
Fixed-term employment contracts warm the spirits of trade unions and the opposition but "thinking of hindering them by law or forcing companies to always hire on permanent contracts is pathetic". Claudio Negro's article for First Online
It's not that we're enthusiastic about Meloni's "1st May" decree, but we would like to dwell on one of its aspects that has collected the most criticism: the discipline of fixed-term contracts. Not because we consider them as such a "magic" resource (although in certain situations, such as recovery after a crisis, they have a non-marginal function) but because they are structurally inherent in a healthy labor market. They can be incentivized or disincentivised, depending on the choices of economic policy. But thinking of hindering them by law, and thus thinking of forcing companies to take on permanent contracts, is as pathetic as thinking of fixing the taxable amount of labour. Moreover, despite the apocalyptic tones used by some union leaders, the number of fixed-term contracts continues to drop while that of stable contracts increases: permanent employees increased by 515 thousand units (+3.5%) in one year, against a sharp reduction in fixed-term employees of 143 thousand units (-4.6%), which once again falls below 3 million.
The Government has intervened to lengthen the duration of fixed-term contracts which could reach 24 months or even more
In reality, the most evident effect of the provision is that of encouraging the lengthening of the duration of fixed-term contracts, which can more easily reach 24 months and on certain occasions even more. And here the ideological discriminant intervenes: not being able to reiterate the fixed-term contract, would the Company transform it into a permanent one? If she doesn't do it, because the experience with the employee didn't convince her or because she doesn't want to inflate the workforce on a permanent basis, it will certainly not be the ban on extending it that will force her. On the other hand, it must be said that the approach aimed at making fixed-term contracts ever shorter and non-renewable worsens the conditions of the workers to whom it applies, to whom a 24 or 36-month contract is much more useful than a short one.
It should be noted that a forward contract that can be extended up to two years is starting to look a lot like a stable contract: both because if it lasts that long it is likely to turn into a stable one: the conversion rate of forward contracts into stable contracts is in fact increase (almost 12% compared to 9% in 2021); and because the de facto duration of open-ended contracts is rather short, especially in times of voluntary resignation: around 30% are terminated within the first 12 months. The permanent contract no longer embodies the "lifetime" job of the good old days of Taylorism and Laborism. And after all, even in the mythical Spanish reality, so dear to trade unions and the political left, there is an element of "desencanto": it is true that the fixed-term contract has been very limited but on the other hand the stable contract is destabilized; in fact, dismissal, even without just cause, is always possible upon payment of a penalty equal to a maximum of two months' salary. Adopting the "Spanish" model would mean substantially reducing the art. 18 of the Workers' Statute: if you want, say so explicitly.
The real problem: contracts in the trade-tourism-catering sector
In this spasmodic fight against "long" fixed-term contracts, the union and the left (which, however, for some time now, even before Schlein showed up, has given clear signs that they are no longer in the trade) have overlooked the real problem : very short contracts in the commerce – tourism – catering sector.
Which are partly physiological: let's think of contracts for a few days linked to activities such as promotions-presentations, and which can very well be brought into compliance through the deprecated vouchers, which guarantee emergence from black and social contributions. But which in another part, especially in tourism-catering, are caused by an unwillingness to invest in the workforce in the long term; therefore a closed circuit is created between supply and demand, where demand, precisely due to the choice not to invest in the future, proposes fixed-term, part-time and very often underpaid contracts and the more qualified offer consequently turns offshore. This is largely caused by the enormous presence of micro-companies and in general by the under-dimensioning of companies in these sectors.
The tourism sector: a real and defined area of suffering
A figure taken from the Excel – Anpal observatory relating to the forecasts for the five-year period 2023-27: the loss in economic terms caused by the mismatch in the sector is 7.4 billion a year, by far the highest of all sectors; and this in the face of a demand which, in the five-year period, between turnover and new hires, foresees over 750,000 new hires. Basically, the sector that tends to employ more workforce suffers from a double depression: the regulation through the CCNL is only partial, the demand always exceeds the supply but this does not cause increases in wages; collective bargaining doesn't work, but neither do market laws. If it were a niche in the labor market it could be an interesting object of study, but on this scale it becomes a big problem for the social partners and the government. An area of real and defined suffering, which requires concrete answers, far beyond the rhetorical complaints about the imaginary biblical scourge of precariousness.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/verita-e-bugie-su-decreto-lavoro-e-contratti-a-termine/ on Sun, 14 May 2023 05:16:21 +0000.