Cabinet goes for redundancy pay limit

Redundancy pay is back on the agenda, with the government again ready to bring in limits for people earning over €75,000 a year, according to various media reports on Tuesday.

Social affairs minister Piet Hein Donner wants to make an agreement with trade unions and employers to limit golden handshakes for top earners to the equivalent of one year’s salary, according to sources close to the cabinet.
The Volkskrant says the new agreement will affect 700,000 employees.
In return for the ceiling on golden handshakes for executives, the cabinet has agreed that the existing redundancy legislation will not be changed to make it easier to sack people during the current government term.
The move could signal the end of a long-running conflict between employers and trade unions on the issue of redundancy.
End to conflict
From their side, the unions have promised that wage claims next year will be modest. According to ANP news service, the maximum claim will be for a 3.5% rise, similar to this year.
The cabinet is keen to keep inflation under control, but with inflation set to reach 3.3% next year, the unions have been pointing to a higher wage rise.
The details will be worked out in the traditional autumn talks between the government, employers and unions, says Donner.
The cabinet has already agreed to abandon the proposed 1% rise in value added tax (btw) and agreed to cut unemployment benefit premiums on the understanding that wage claims are kept low.
Donner also wants to discus show to get more people into jobs and retraining schemes at the meeting.
For the unions and political reactions to this story, click here
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