.png)
.png)
Change in COLA for 2011 ‘out of the question’ – Malta Employers’ Association
MEA warns it will instruct its members not to pay out any additional cost of living increases even if it is enforced on them by government.
The Malta Employers Association has blasted a call by General Workers Union and Forum to revise the cost of living allowance, by saying any revision to the mechanism was “out of the question”.
The Ghaqda Unions Maltin today called for the revision of the COLA to anticipate inflationary pressures which are expected to occur during 2011.
In a statement, the MEA said that companies were also hit hard by the increases in fuel prices, and that besides COLA, employers are also facing higher social security contributions as part of the pension reform.
“Raising COLA at this stage will only create further inflationary pressures and will contribute towards a wage price spiral that will have a negative effect on the country’s competitiveness,” the MEA said.
The MEA warned it will instruct its members not to pay out any additional cost of living increases even if it is enforced on them by government. “There have already been precedents in the recent past when employers were forced to pay more than what was stipulated in the COLA agreement.”
The MEA added that unions were always inflexible whenever employers wanted to discuss a revision of the COLA mechanism. “In fact, unions refused to discuss a revision in the COLA increase of €5.82 which was given in 2010, even though this could have resulted in job layoffs during a period of recession. The reason given by the unions at the time is that COLA is an agreement which was reached years ago and that employers are bound to honour that agreement.”
The MEA said unions believe the COLA contributes to social harmony and stable industrial relations, however they could not pick and choose the time and terms under which such agreements should be broken. “Unions are also represented on the retail price index board, which is the body that measures inflation, so they know only too well that the computation of €1.16 for 2011 was based on agreed parameters and objective computation, a fact known since September 2010.”
