Controversies related to the salary system in Romania

One of the big trade union organizations in Romania, Cartel Alfa, has asked for the resignation of the labor minister, Lia Olguţa Vasilescu

Ştefan Stoica, 02.11.2017, 13:05

Two controversial government bills, one on salaries in the public sector and the other on the modification of the Fiscal Code, will take effect in 2018, and employees fear that the measures have not received proper consideration from the leftist governing coalition made up of the Social Democratic Party and the Alliance of Liberals and Democrats. These days, the social dialogue between government and trade unions has come to a standstill. The most vocal critic of the proposed measures, the Cartel Alfa leader, Bogdan Hossu, has warned that the bill on amending the Fiscal Code, which transfers from employers to employees the obligation of paying the social security contributions, is quite flawed and can endanger the situation of 2 million employees who might incur losses in terms of their net income.

Cartel Alfa has called for the resignation of the labor minister, Lia Olguţa Vasilescu, whom they accuse of disinformation and lying as regards the effects of the proposed measures. The trade union organization also claims that Minister Vasilescu has drafted one of the worst public salary laws, which does nothing but deepen inequities and imbalances in the public sector. In reply, Minister Vasilescu caustically urged trade unionists to learn some math while giving assurances that the new fiscal provisions will not lead to a drop in salaries. She also leveled criticism against the Cartel Alfa leader, Bogdan Hossu:

“Mr. Hossu is always interpreting our decisions in his own way. He did the same with the declarations of the employers’ associations’ representatives. When asked by the prime minister, the employers’ associations’ representatives said clearly that they did not intend to decrease salaries”.

Another important trade union organization, the National Trade Union Bloc, draws attention to the fact that there is no certainty about maintaining the level of net salaries at the level prior to the implementation of the aforementioned measure, given that there is no law forcing employers to increase gross salaries by the amount of the social security contributions which they have paid to the state budget until now. Employers associations avoid getting involved in the conflict between the government and trade unions. However, blocking social dialogue is not a solution, and businesspeople recommend the government pay more attention to the issue and not hurry to take measures whose potential impact was not assessed properly. Dragoş Anastasiu is the representative of the employers’ association entitled the Coalition for the Development of Romania:

“Let’s have a genuine dialogue and give ourselves a 3- or 4-month period to analyze the measures and to make an impact study which has not been made. We need to reach consensus. Romania has reported economic growth, therefore there is no need for hasty measures.”

The Coalition for the development of Romania says the business environment has not asked for this measure of transferring the obligation of paying social security contributions from employers to employees. Moreover, they believe that this measure could lead to an increase in the level of gross salaries, which might make Romania totally uncompetitive in comparison to other states. (Translated by L. Simion)