MADRID: Spain's government Friday approved new labor reforms aimed at curbing soaring unemployment and showing its determination to revive the economy, despite widespread popular protests. The government voted to back the changes to the collective bargaining system without the support of the CEOE employers organization and the main unions after talks between them broke down last week. Unions and employers had been negotiating for months over a reform of the system, considered a crucial plank of labour, banking and pension reforms aimed at reviving the economy. The International Monetary Fund and the Bank of Spain believe the current system, which includes industry-wide agreements that cannot be modified, is too rigid. "We have approved a bill on urgent measures in relation to collective bargaining," Deputy Prime Minister Alfredo Perez Rubalcaba told a news conference. "We managed to strike a balance between the flexibility necessary to create employment and the security that workers in Spain want." The reforms, which must still be approved by parliament, notably reduce the period that a contract remains valid once it has expired. "In the absence of an agreement between unions and employers, the government has pursued a radical, advanced and balanced reform, taking into account the positions expressed by those involved in collective bargaining," a government statement said. The bill "aims to introduce more flexibility within companies so that when they undergo changes or go through difficult situations they can adapt to new conditions." But businesses have criticized the plan, saying it does not go far enough. And protesters have taken to the streets in recent days to condemn the measures. They are part of protests over the economic crisis, 21.29 percent unemployment – the highest rate in the industrialized world.
