Employers and unions are set to ratify an agreement on the cost-of-living allowance (CoLA/ATA) on Wednesday, based on a government framework, with a permanent deal likely to be signed on Thursday — provided what SEK general secretary Andreas Matsas yesterday called “the invisible hand” doesn’t reappear to block it.
The agreement is expected to lay the groundwork for implementing the government’s position of “ATA for all” over time.
President Nikos Christodoulides completed a round of meetings with social partners on Monday, having met Sunday evening with the heads of the employers’ organisations OEV and KEVE, and yesterday with union leaders.
According to sources, the president told both sides the framework as shaped after Friday’s meeting will not change and there will be no further negotiations.
Specifically regarding linking the ATA to the minimum wage and full restoration of the scheme within a specific timeframe, the president made clear these are government positions and will not change.
With these terms, social partners will go into Wednesday’s meetings either to accept or reject the framework, which was shaped after months of negotiations between them and the Labour Ministry.
Sources said the union side appears readier to accept the framework, given the removal of the sticking point of graduated ATA payments, whilst employers, although they disagree with specific points such as the link to the minimum wage and the level of tax incentives to be granted, may still proceed with ratification.
This is provided no voices emerge from within the organisations strongly opposing the agreement.
Unions have called a pan-union meeting for Wednesday to brief all sides and take a final decision. Procedurally, each union will make its own decision, but if the pan-union meeting gives the green light, it is certain each union will make a corresponding decision individually.
Employers, who were due to hold their own meeting on Monday, postponed it to Wednesday because of the meeting with the president. The executive committees of OEV and KEVE will meet jointly on Wednesday to determine their position — to approve or reject the framework before them.
Earlier on Monday, President Christodoulides, asked about the ATA issue, said that “following Friday’s meeting with the two ministers, where a framework was shaped which appears initially to be acceptable to the unions, I had yesterday a very productive meeting with the heads of the employers’ organisations, in which we naturally discussed the framework, and we await their final decisions in the coming days”.
Labour Minister Yiannis Panayiotou said the aim is for the next ATA meeting to be for signing the agreement. The process is at its final stage and conditions have been shaped and convergences achieved so the ATA issue can have a permanent and positive outcome, he said.
The ATA agreement framework
After Friday’s meeting, a final framework was shaped to be put to unions and employers for approval on Wednesday.
It is a five-point document:
(1) Full restoration of ATA to 100% within 18 months. Specifically, from 66.7% today, it will rise to 80% on 1 January 2026, to 90% on 1 July 2026 and 100% on 1 July 2027.
(2) Imposition of a 4% ceiling on inflation levels.
(3) ATA will be paid to employees once a year, provided the previous year moved with positive growth rates.
(4) ATA is linked to the minimum wage on an annual basis. The minimum wage will be reviewed every two years.
(5) If risks to the economy are diagnosed, the Labour Advisory Board will convene in expanded form to examine the situation. Beyond this, there is the issue of granting tax incentives to employers, which was discussed between employers and the Finance Ministry.
