Disputed labor reforms

Italy's parliament approved a contentious labor reform package on Wednesday, the day before the country's Prime Minister Mario Monti was set to attend a crucial EU summit with other European leaders in Brussels.

The reforms were passed by a solid majority, with 393 in favor versus 74 against. There were 46 abstentions. The government has now obtained the four necessary confidence votes for the package of reforms, as parliament fast-tracked the text's approval on Tuesday and Wednesday.

The reforms, first announced in March after recurring disputes with local trade unions, is inspired by the Danish "flexicurity" model. In part, this aims to make hiring and firing easier for employers: it includes incentives to encourage firms to take on workers but it also makes it more straightforward for them to lay off staff during difficult economic times. It also includes a strategy for assisting the country's youth in obtaining jobs through apprenticeships.

And included in the changes are measures through which workers will be able to benefit from an improved welfare system five years from now.

But some argue that the package has been watered down as Monti has been forced to compromise on key aspects of the reforms; Italy's Confindustria business association responded to the developments by saying that the measures are insufficient for strengthening employers' rights.

Onlookers are unconvinced

Unconvinced commentators further highlight that reforms are expected to be modified at a later date in upcoming legislation.

"Europe and the markets will appreciate the fact that the reform has been approved, but will also be well aware that there will be corrective measures introduced in the next few weeks," the Italian daily newspaper Repubblica said.

And experts like Maurizio Del Conte, a professor of labour rights at Milan's Bocconi University, are skeptical, insisting that the reforms offer "nothing new of significance" and "will not be able to relaunch employment" in a country where unemployment hovers above 10 percent.

A political price tag

Moreover, the changes have come at a heavy political price for the unelected, technocrat leader Monti, whose popularity is waning, analysts warn. Political parties supporting Monti have become nervous about backing the prime minister, as his approval rates have plummeted to 33 percent, in contrast to 71 percent when he first came to office last November, according to an SWG poll released earlier in June.

"It seems Monti is pedalling the parliament-government tandem nonstop... but the others just look on, as skeptical rather than interested spectators," another Italian newspaper, Corriere della Sera said.

"This fuels questions besieging Italy, which center in Western chancelleries and mass media on the unknown of what will come post-Monti," the article also said.

sej/msh (dpa, AFP)