Cabinet puts redundancy reform on ice

Ministers have decided to put controversial plans to reform the rules on redundancy on ice in order to avoid a cabinet crisis.

Instead, it is to set up a committee of experts who will make recommendations on ‘strengthening labour participation’ by next June.
In the meantime, the three-party cabinet will press ahead with other measures to get more people into work, prime minister Jan Peter Balkenende said on Tuesday evening.
Labour and the ChristenUnie ministers are totally opposed to aspects of the redundancy reforms, drawn up by Christian Democrat Piet Hein Donner. In particular, the plan to end the role of the courts in assessing redundancy would weaken the position of workers, they said.
Donner argues that a more flexible approach to redundancy law will encourage companies to take on more staff. The current cabinet is committed to boosting the workforce by 200,000 jobs.
The new committee will look at ways to increase the number of people in work from 70% of the working population now to 80% by 2016. Redundancy law is not explicitly mentioned in the committee’s tasks, the Financieele Dagblad says.
‘We agree that there is no point in putting energy into issues which divide us,’ Labour leader and finance minister Wouter Bos told the Financieele Dagblad.
A spokesman for the employers organisation VNO-NCW, which supports Donner’s plans, said the decision to delay the reforms was regrettable but unavoidable given the political impasse.
MPs will today discuss Bos’s own plans to tackle top people’s pay.
The Financieele Dagblad says the decision to limit the tax breaks on pension premiums to the first €185,000 and an increase in tax on homes worth over €1m are now likely to be dropped as well.

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